Starting on 14 May 2025, letting agents across the UK are legally required to conduct financial sanctions checks on all prospective landlords and tenants, regardless of the rental value. This change aims to enhance efforts against financial crime and ensure compliance with the UK's financial sanctions regime. If you are a self-managing landlord, you will also be required to check your own tenants by making anti money laundering checks.
Here are some of the key requirements for lettings agents:
Mandatory Screening: Letting agents must verify the identity of all parties involved in a tenancy agreement and check them against the UK's consolidated financial sanctions list.
No Rental Threshold: Unlike previous regulations, there is no minimum rental value threshold; all lettings are subject to these checks.
Reporting Obligations: If an agent knows or suspects that a person is designated under financial sanctions, they must report this to the Office of Financial Sanctions Implementation (OFSI) immediately.
Record-Keeping: Agents are required to maintain detailed records of all sanctions checks, including the date of the check and its outcome.
How can you prepare?:
Implement Robust Screening Processes: Use government resources such as the OFSI consolidated list to verify landlords and tenants.
Train Staff: Ensure all employees understand their reporting obligations and the importance of compliance.
Develop Internal Policies and Procedures: Set clear guidelines for identifying and handling potential financial sanctions breaches.
Stay Updated on Regulatory Changes: Regularly check OFSI’s updates and guidance to ensure continued compliance.
For more detailed information, you can refer to the official guidance provided by the Office of Financial Sanctions Implementation and HM Treasury.
Contact us for expert guidance!
