"The property sector is under constant siege, and breaching the rules unintentionally is not an adequate defence"
- Martin Cheek - SmartSearch
Digital compliance solutions provider, SmartSearch, has shed light on the alarming lack of readiness in the property industry as part of a comprehensive new survey of 500 compliance decision-makers across multiple sectors.
More than a quarter of property developers freely admit that they would need more than a week to compile a compliance audit if they found themselves under investigation.
Worryingly, property development firms are also making future audits even harder for themselves with almost half (46 per cent) freely admitting that they rely on flawed manual checks to verify identities during onboarding.
Martin Cheek, managing director at SmartSearch, commented: "The property sector is under constant siege, and breaching the rules unintentionally is not an adequate defence.
“The inability to swiftly compile a compliance audit when the regulator knocks on the door not only poses a risk of business downtime but also opens up firms to potential legal ramifications.
“Property firms that continue to rely on manual checks are also hindering their ability to stay ahead in the fight against increasingly complex financial crimes.”
The Financial Conduct Authority (FCA) began the year with a staunch focus on anti-money laundering (AML) handing out fines for compliance failures. The common thread in the FCA's actions has been punishing firms for their shortcomings in AML compliance, even in cases where there is no explicit proof of money laundering taking place.
In fact, principle 3 of the FCA’s Principles for Business requires a firm to “take reasonable care to organise and control its affairs responsibly and effectively, with adequate risk management systems”.
Mr Cheek added: "Being audit-ready is not just about adhering to regulations. It's about safeguarding a firm's reputation and ensuring the continuity of business operations without disruptions.”
Digital compliance offers a robust and instantly deployable audit trail that enables the property industry to remain vigilant against AML and sanctions breaches. These innovative solutions are designed to minimise the risk of a compliance breach, providing a streamlined approach to meeting regulatory requirements.
The next generation of digital compliance is a game-changer. It simplifies the onboarding of new customers, making it quicker and more cost-effective for firms to comply with AML regulations.
Firms can now easily prepare for internal audits and unscheduled regulatory visits at the click of a button.
Mr Cheek concluded: "Property firms and estate agents must stop wasting time and resources on inadequate reporting; by adopting a fully automated and easy-to-understand compliance platform, you get the reports you want or need immediately."
