Research conducted by Fortytwo Data has revealed that just below a third of all suspected anti-money laundering violations that have been reported over the last three financial years to the National Crime Agency have links to deals involving property.
32% of alerts for ‘Suspicious Activity Reports’ within the National Crime Agency system have been linked to conveyancing of residential property. This figure may seem high, but it is staggering when you see that the second-placed alert in the list is conveyancing for commercial property at just 4% of all alerts.
The data is based on information that the SRA has provided for the three years from 2014/15 up until 2016/2017 involving ‘red flag alerts’ involving residential conveyancing. In some cases, criminals have instructed legal professionals to transfer or hold on to money in order to provide them with legitimacy. At the start of this year the National Association of Estate Agents claimed that there had been a number of estate agents fined for their part in breaches to anti-money laundering regulations.
None of these individual cases have been made public at this time but it is interesting to see that there has been a stricter approach to the problems that face the industry with regards to this type of criminal activity. The Solicitors Regulation Authority (SRA) has released the information and has stated that in around two-thirds of cases like this, where wrongdoing has taken place, they will be referred to the Solicitors Disciplinary Tribunal.
Conveyancing solicitors in Shrewsbury and around the UK have such an impact and control over certain, important, aspects of the process behind the sale or purchase of a property that regulations have to be tight to keep things in check when it comes to anti-money laundering ideals. The legitimacy of the profession makes it an interesting target for criminals.
Julian Dixon, the chief executive of Fortytwo Data stated: “These figures are a wake-up call to the legal industry but I’m sure money laundering is vastly under-reported due to the nature of organised crime. Solicitors in Shrewsbury and across the UK are vulnerable because of the legitimacy their profession provides. For criminals, the vast amount of cash involved in property purchases provides the perfect cover for laundering the proceeds of drugs, terrorism and firearms offences.”
The Solicitors Regulation Authority has done well in recent years to keep on top of instances of wrong-doing when it comes to conveyancers and solicitors involved in money-laundering through both commercial and residential property deals. Handing out significant fines and associated costs to those firms and individuals where AML obligations have not been met is a strategy that seems to be working. It is thought that a deterrent approach to this problem in the form of high fines will lead to more compliance in future from companies within conveyancing that should know better.
Summary: A striking report has suggested that nearly a third of all money laundering in the UK is related to conveyancing services. Read on to find out more about how property and financial crime are linked.