The property market can be a dangerous place. In a world where financial crime is both proliferating and becoming ever more sophisticated, the property sector is one of the most vulnerable to fraudulent activity. Whether you are a company dealing with individual lettings or sales, or managing commercial property deals, many of the issues are the same. From small-time fraudsters, trying to obtain a rental agreement under false pretences; through to shell companies trying to gain a foothold in the commercial property market, there are a wide range of issues that need guarding against. Efficient KYC (Know Your Customer) and CDD (Customer Due Diligence) processes are the first steps in doing so.
AML (Anti-Money Laundering) rules are becoming more stringent and with 6AMLD (6th Anti-Money Laundering Directive) being introduced, the defence of not being aware of criminal activity no longer applies. Companies and Individual Company Officers are subject to prosecution, including fines and imprisonment, if their company does not identify fraudulent activity taking place. So, the importance of KYC and CDD has now become personal!
Why is KYC Important for Property Firms?
The lives of Estate Agents, Property Rental Companies and Managing Agents have become more complicated. What used to be viewed as a safe and simple market, has now been increasingly tainted by UK and overseas criminals, who see the UK property market as an easy way to launder their ill-gotten gains. On an individual level, there have been strides made in our abilities to identify fraudsters, but at a company level it has taken longer for UBOs (Ultimate Beneficial Owners) to be identified accurately. Fortunately, legislation has caught up, making the situation easier to navigate.
When selling or renting a property to an individual, KYC identity verification must be carried out. Traditionally, a person would visit the branch and present their documentation for the Agent to verify. But times have changed. Customers now want to use remote verification techniques with easy-to-use digital solutions for speed and efficiency when it comes to onboarding.
Remote ID Verification for KYC Onboarding in Property
A whole range of documentation can be verified remotely including– passports, driving licences, identity cards, visas, birth certificates and more to provide personal and address verification. Coupled with biometric facial recognition, voice recognition, liveness detection and other anti-spoofing techniques, these give companies a wide armoury of tools for seamless KYC onboarding.
KYC onboarding doesn’t need to be a painful experience and customers expect – especially since the advances made in digital technology since Covid – to be able to translate their personal data into a positive decision, very quickly.
Easy to Deploy Technology for KYC Onboarding in Property
If property firms are to stay ahead of their competitors, they must meet customer expectations and deliver modern software for KYC onboarding. The administrative burden also needs to be considered. Whilst manual admin is costly, more importantly it is, by its very nature, subject to human and systems error, that can prove costly – both in terms of financial sanctions and legal prosecution.
The move to a digital solution can be a daunting prospect for many companies: “What sort of implementation timescale are we talking about? Weeks? Months?”, “What sort of downtime can I expect on my systems, and will it actually work?”, “How will I convince my customers to engage with this software, or download an App?”
It’s these types of concerns that software companies encounter all the time.
But the answers are simple.
No, it doesn’t take weeks or months, often it’s just a few hours at most.
No, you won’t have any downtime, it’s normally just a switch over.
More importantly, customers find it so easy. As long as the customer has a device, such as a mobile phone, tablet or computer with a camera and an internet connection, they can sign up immediately. KYC onboarding can then be achieved in just three easy steps; document verification, liveness check and address verification by using the camera on their device.
Customers find remote verification so easy, and costs are quickly saved against existing manual processes and resources. The back-end benefits and process gain for not only your compliance team, but also your admin and sales teams, can be enormous.
There are many software products on the market that can be used to digitise the processes involved and NorthRow’s RemoteVerify for KYC property onboarding is one of the market leaders. Our software is kept up-to-date with the latest digital and biometric tools available, we have access to detailed UK and Worldwide databases and have an intelligence-sharing agreement with law enforcement agencies.
From KYC Onboarding Through to Ongoing Monitoring
But the job doesn’t end with the initial KYC onboarding. So much can happen throughout a client’s lifecycle, that it is essential to have ongoing monitoring and remediation processes in place. Client Lifecycle Management (CLM) is a crucial part of any regulated entity’s operation and it’s an area where many have the most problems in sustaining. CLM can be viewed as an expensive ‘nice to have’, but it doesn’t have to be, and it definitely isn’t a ‘nice to have’. Not when you consider the strength of sanctions, fines and potential prosecution that the latest legislation can wield.
Watch our RemoteVerify demo to learn how your property business can deliver seamless KYC onboarding.