More red tape as government wants Anti-Money Laundering for letting agents

A formal consultation process has started to consider government plans to extend Anti-Money Laundering from property sales to lettings as well.

Unveiled on the same day as the proposals to scrap Section 21, and thus overshadowed by the publicity surround the eviction measure, the new AML move would see the Fifth Money Laundering Directive applied to lettings agents as well as sales agents.

The directive would include letting agency sector for high value transactions with a monthly rent of 10,000 Euros or more.

A note released by the Association of Residential Lettings Agents says that the directive - part of EU legislation set to apply in the UK from January 10 next year, even if Brexit happens in the meantime - would improve transparency and help combat money laundering and terrorist financing across the European Union. 

ARLA says the main questions in the consultation include:

- What other types of lettings activity exist? What activities do you think should be included or excluded in the definition of letting agency activity?;

- Should the government choose a monthly rent threshold lower than EUR 10,000 for letting agents? What would the impact be, including costs and benefits, of a lower threshold? Should the threshold be set in euros or sterling?;

- Do letting agents carry out appropriate checks on both contracting parties (tenants and landlords) when acting as gents in a transaction?

ARLA says there are eight questions in total for letting agents to answer. 

It adds: “To have your say in the consultation you can either email your views to ARLA Propertymark or submit them directly here.”