Your tenant referencing procedures affect your banking services. In 2015 only Handelsbanken insist on PEP checks now other High Street banks follow suit.

Since it was fined 35 million crowns in 2015 for breaching anti-money laundering (AML) legislation, Swedish bank Handelsbanken changed the way it handles AML checks.

It requires all letting agents with client accounts to complete politically exposed persons checks – despite the Money Laundering Regulations stating that letting agents aren’t responsible for carrying them out.

Failure to comply with this requirement risks account services being withdrawn.

And it’s not just Handelsbanken, HSBC introduced the same rules last year, and other banks have followed their lead.

The last thing you need from your bank, is a withdrawal of services, think of the upheaval this could cause. Why risk it?

Protect your landlords

For letting agents (and your landlord clients), these new requirements add yet another layer of responsibility and risk. As if you didn’t have enough! And at a time when you are already dealing with significant issues around tenant identity.

By June this year, fines for failing to carry out the correct document checks under the Right to Rent legislation had reached £265,000 – and they’re still rising, with prison sentences a possibility.

You may think that sounds overdramatic but not when you think that Europol have reported a 76% increase in lookalike document fraud, and the City of London police say there could be a forgery factory in every major town and city in the UK. You need to make sure you and your clients don’t fall foul to these criminals.

What you need to do

Make sure that every single tenant is vetted in the same way. Consistency is the key. It’s vital that you are carrying out checks for both identity documents and AML. It’s not a legal requirement, that’s true, but why would you risk a fine or imprisonment for you or your client landlord?

  1. All occupants must be vetted, not just the named tenants
  2. Letting agents are as liable as the landlords for compliance
  3. Custodial sentences are a real possibility; up to five years
  4. Make sure you know the detail of the checks that are carried out.

There are a lot of ‘New Kids on the Block’ in our market, some are better than others. Check, check and check again. AML checks should be standard practice. Keep your and your client’s best interests at heart.

Keysafe’s standard checks on your landlord’s potential tenants help identify whether they are:
  • A Politically Exposed Person (PEP)
  • Presenting a forged or stolen passport
  • In possession of a valid bank account
  • Subject to HM Treasure Sanctions
  • On the Specially Designated Nationals List (OFAC)
  • Known as deceased
  • Subject to County Court Judgements (CCJs) or Personal Insolvencies

For more detail on how to make sure your banking services aren’t cut off, give Keysafe a call on 08718 96800, or email us at info@keysafetv.com.