The Fifth Money Laundering Directive - how will this affect landlords from 10 January 2020?
On the 10 January the Fifth Money Laundering Directive (5MLD) takes effect in the UK. This will make changes to the UK anti money laundering regime and will bring letting agents within the scope of the Money Laundering Regulations for the first time.
All tenancy agreements with a rent in excess of €10,000 per calendar month will be caught by the regulations. What this means is that for the first time lettings agents will be required to carry out what is being called “know your customer” checks on landlords and tenants. The “Know Your Customer” checks will mean identification checks, verification that the tenancy is genuine and has not been set up to assist either the landlord or tenant to clean up the proceeds of crime. Tenancies that fall within the scope of these regulations will require on-going monitoring to check the initial conclusions regarding the money-laundering risk remain relevant. Landlords and tenants who fall into this category of tenancy should therefore prepare for more questions and administration.
Further information on the Fifth Money Laundering Directive can be found on the .GOV website
If you would like more information or would like to talk to one of our local lettings experts, you can either pop by your local branch or book a lettings review.