Does your agent protect you against money laundering crime?

If you’re a landlord, choosing a tenant can feel extremely challenging. How do you know they’ll reliably pay their rent and take care of your property? Equally, as a tenant, how do you know your landlord is reputable?

An experienced and credible letting agent carries out a series of checks to ensure all relevant safety checks are undertaken in the property and suitable due diligence carried out on all relevant parties involved.

Earlier this year, a new requirement was introduced for agents to check tenants and landlords against the UK’s official sanctions list to combat money laundering.

However, if using an agent can you be sure they will follow the legal requirements and adhere to the related industry guidance especially when it comes to compliance based matters?

Let’s find out more about AML (anti-money laundering) due diligence requirements…

This is the process of verifying a person’s identity, legitimacy and financial background to prevent fraud and other crimes being committed, such as money laundering.

- In May 2025, it became a legal requirement for UK letting agents to carry out Sanction Checks on both tenants and landlords. This involves running their details through the UK’s official sanctions list. This will include names of people known to be involved in crimes such as money laundering, terrorist financing, human rights violations, organised crime and other national security threats.

- Sanctions Checks apply to all tenancies regardless of rent amount (they used to only apply to higher-value rents).

- These checks must be carried out prior to commencement of any new tenancy and again annually for as long as the tenancy remains active.

- They apply not only to new tenancies agreed as from May of this year but also any active tenancies in place at that time.

- For landlords not using agents, they are still required to undertake the same checks on their tenants as an agent would have done.

Assuming you have nothing to hide, the new legal requirements won’t affect you too much. However, the extra checks can add a little time to the process of setting up a new tenancy, and the checks themselves incur a cost.

Ultimately, AML due diligence is great for transparency within the industry. Whether you’re a landlord or tenant, the checks provide confidence that you are dealing with a reliable, law-abiding person and not becoming unintentionally embroiled in a money laundering scheme.

Where a match is found on the sanctions list, the tenancy must be paused and the relevant person or people reported to the Office of Financial Sanctions Implementation (OFSI).

As already explained, where an agent is involved, they are responsible for conducting the required checks on all landlords and tenants. If the landlord is dealing with everything privately, then they must carry out the checks on their tenants. If it is discovered that any relevant party matches those on the sanctions list then whoever initiated the checks must either report this immediately and no longer process any further financial payments until advised otherwise

As a landlord or tenant, the process of letting/renting can feel overwhelming. Any landlords or tenants should be able to trust and rely on their agent if working with one. If they fail to carry out these legally required checks, there could be halts or delays to the tenancy process and they could face potentially severe repercussions.

At Beresfords, our lettings team stay at the forefront of industry news and complies with all the latest regulations. We have an excellent relationship with industry regulator Propertymark and are well prepared for the legal changes introduced in May. By choosing us our clients should feel reassured they would be using a reputable agent with a proven track record spanning more than 57 years whose staff are suitably qualified and equipped to offer sound and reliable advice.

If you’re a landlord or tenant and are concerned about how AML due diligence affects you, we’re here to help so please do not hesitate to get in touch.