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Reform of the Anti-Money Laundering and Counter-Terrorism Financing Supervisory Regime

Consultation Response by the Association of Relocation Professionals (ARP)

The ARP is the professional body for experts in UK relocation.  For over 30 years we have been championing higher standards within our industry as well as representing our members in an ever-changing sector, seeking to promote excellence, communicate changes and lobby the Government and other authorities for betterment in terms of current and future legislation.

This Response, on behalf of our members, is not directly concerned with the question of the current or future supervisory regime.  Rather, we wish to draw to your attention the unnecessary and unfair targeting of UK relocation companies under the current AML rules.

The ARP fully understands the requirement for solicitors, estate agents and letting agents to carry out identity checks on their clients (and other parties) and to check the source of funds.  However, in recent years, British relocation businesses have been pulled into the UK’s AML compliance regime.  At first it was only relocation firms which carried out home finding services for buyers which were affected; then, more recently, rental home searches were covered for firms which – even occasionally – find tenancies with rents exceeding 10,000 euros per month. 

If a UK relocation business falls into either of these categories, then it is illegal to carry on business without registering with HMRC for money laundering supervision.  The business must also put in place a variety of burdensome processes and documents, all of which are enforced by audit visits from HMRC.  This “red tape” includes:

1. Producing a written AML risk assessment for the business;
2. Preparing a written statement of the company’s AML policy and procedures, all in compliance with HMRC’s requirements;
3. Carrying out Customer Due Diligence checks and completing these checks before starting work for a new client;
4. Training staff on all aspects of AML compliance;
5. Appointing someone in the business with responsibility for reporting “suspicious activity” to the UK National Crime Agency;
6. Keeping written records of everything for 5 years.

This heavy administrative burden which has been placed on relocation companies is:

1. Unnecessary: identical checks on these clients are carried out by other property professionals, i.e. solicitors, estate agents and letting agents.  This regulation of relocation companies is serving no purpose.  Rather than filling a possible compliance gap, it is only adding unnecessary “red tape” to an important UK business sector.
2. Unfair: despite the fact that the AML regulations are based on (pre-Brexit) EU Directives, only the UK Government has included relocation companies within the full AML compliance regime.  British relocation companies have actually been placed at a competitive disadvantage against their EU-based competitors.  This flies in the face of the UK Government’s stated intention to reduce “red tape” for British businesses.

The Association of Relocation Professionals calls for the removal of relocation businesses from the unnecessary burden of full AML regulation.