New regulations on money laundering came into effect on Monday 1st March 2004 (Money Laundering Regulations 2003). From this date the regulations covered estate agents. Legal advice taken by HBF and members as to whether the regulations cover house builders is conflicting. The Treasury has advised HBF that although the Treasury wrote the regulations, it is down to the courts to interpret them. A briefing note prepared in April 2004 explaining this situation is available below. The issue will not be finally resolved until there is a court case or new/amended regulations are introduced.
In response to the new regulations, HBF members appear to have adopted one of three different approaches:
Some have assumed the regulations do not apply to house builders and have therefore not introduced the procedures required by the regulations.
Some have assumed the regulations do apply, but are relying on the ID checks already required to be carried out by a buyer’s solicitor and, where applicable, mortgage lender, rather than seeking ID checks directly from buyers.
Some have assumed the new regulations do apply to house builders and have implemented in full the requirements of the regulations.
A guidance note prepared by Eversheds for HBF members on the implications of the money laundering regulations is available below. However, HBF members are advised to seek their own legal advice.
HBF Contact for Money Laundering:
John Stewart, Director of Economic Affairs
John.Stewart@hbf.co.uk
Telephone: 020 7960 1608
