Money Laundering and Sanctions Reporting

Money Laundering

Estate agents are regulated businesses under the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (as amended). If you are a letting agent who also conducts estate agency work, you must register and comply with these regulations. 

Additionally, certain letting agents (who do not perform estate agency work) are also covered by these regulations if they meet the following criteria:

  • The agent (firm or sole practitioner) performs "letting agency work," which is defined as:
    • Work done on behalf of a prospective landlord seeking to let land or property, or
    • Work done on behalf of a prospective tenant seeking land or property to rent, and
    • The tenancy agreement is for at least one month, and the monthly rent (or equivalent during part of the term) is 10,000 euros or more.

Agents meeting these conditions must:

  • Register with HMRC for anti-money laundering supervision.
  • Conduct a written risk assessment to identify potential money laundering risks.
  • Develop policies, controls, and procedures to manage these risks.
  • Perform customer due diligence (CDD), verifying the identities of landlords, tenants, and beneficial owners.
  • Report any suspicious activity to the National Crime Agency (NCA).
  • Provide ongoing staff training and maintain appropriate records.

Non-compliance can result in severe penalties, including unlimited fines and potential criminal prosecution.

For further detailed guidance, please refer to HMRC's official guide for estate and letting agency businesses.

Financial Sanctions Reporting

From 14 May 2025, letting agents have new reporting obligations under UK financial sanctions legislation, as they are being added to the list of "relevant firms." This means that letting agents must report promptly to the Office of Financial Sanctions Implementation (OFSI) if they know or have reasonable cause to suspect that a person:

  • is a designated person subject to financial sanctions, or
  • has committed a breach of financial sanctions.

These reporting obligations apply irrespective of the monetary value of the rental agreement.

The obligation applies differently depending on your relationship:

  • For prospective landlords: From the moment a landlord formally instructs you to act on their behalf, you must report suspicions related to that landlord.
  • For prospective tenants: You must report suspicions from the moment the landlord accepts the prospective tenant's offer and an agreement is in the process of being concluded.

You must report to OFSI:

  • the basis of your knowledge or suspicion,
  • identifying details of the designated person,
  • details of any funds or economic resources held for that person, if applicable.

These obligations only apply to information discovered while conducting letting agency work, not personal circumstances.

For further detailed guidance, see Financial sanctions guidance for letting agents.

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