When I put my house for sale, the estate agent wanted a copy of my passport and a utility bill, is this normal?
PUBLISHED: 11:31 13 July 2015 | UPDATED: 11:34 13 July 2015
Our property expert Simon Gerrard answers your property-related questions.
This is absolutely normal and I would be shocked if your estate agent didn’t check your ID, because if they didn’t they would be breaking the law!
The National Crime Agency has estimated that £100bn a year of corrupt foreign money is laundered through the UK, involving such things as luxury goods and property. The proceeds of this money laundering goes to organised crime gangs and to help finance terrorist activity. To help combat this and disrupt the flow of dirty money passing through the UK a number of laws have been introduced, such as the Proceeds of Crime Act 2002, Terrorism Act 2006 and Money Laundering Regulations 2007.
The Money Laundering Regulations ensure businesses at risk of being used for money laundering by criminals and terrorists have controls in place to minimise the risk of this happening. These businesses include credit institutions, accountants and tax advisers, casinos, solicitors and estate agents.
This means that an estate agent must be sure of who their clients are and who they are dealing with. To do this the agent must perform KYC (know your client) and will require clients to confirm their identity as well as proving proof of their ownership of the property they are selling. This can be done via the agent seeing and where possible taking copies of documents such as a passport or driving license as well as a utility or council tax bill. There are a number of other documents specified in the legislation that can be used to check and verify ID and property ownership, and it should be noted that even if your solicitor has already made these checks, there is still a legal obligation on your estate agent to carry out these checks on all their customers. So buyers, landlords and tenants can also expect to be asked to provide this information.
In the vast majority of instances the owners will be the people living at the property and so obtaining and checking their ID will be quite straight forward. However where the owners are not resident, maybe they live abroad, the agent will need to dig a little deeper and make further checks. For companies or corporate sellers the agent will need to confirm details of the company and identify and verify who the major shareholders or directors are, as well as checking and identifying the ultimate beneficial ownership.
The agent is also required to re-confirm details of their clients every couple of years, if they are involved in ongoing business relationships. So don’t be offended if you have dealt with the agent before and they know who you are because they checked your details previously, when they ask to see your ID again.
Complying with the money laundering regulations is a basic legal requirement for estate agents. Quite simply they must take full details of your ID when you sign up to sell a property.
If your agent has not asked to check your ID and confirm you are the owner of the property, then you should ask why not? If they are not abiding by this simple legal requirement, they are likely to be putting you at risk, as what else aren’t they doing?
Simon Gerrard is the managing director of north London estate agents Martyn Gerrard.
If you have any questions that you’d like Simon to answer, please send them to firstname.lastname@example.org or tweet us @hamhigh_property