Questions and answers on money laundering
Real estate agencies such as Ibiza Country Villas are "obligated subjects" to "examine with special attention any fact or operation, regardless of its amount, that, due to its nature, may be related to money laundering", as established in Article 17 of Law 10/2010, on the prevention of money laundering and the financing of terrorism.
In this article we will answer some of the most frequently asked questions related to this law and the obligations that real estate agents have.
WHO ARE THE "OBLIGATED SUBJECTS"?
The natural or legal persons referred to in article 2.1 (a) to (y) of the above-mentioned Act. In relation to the purchase and sale of real estate we can highlight
- Credit institutions
- Investment services companies
- Pension fund management companies
- Real estate developers and those professionally engaged in agency, commission or brokerage activities in the purchase and sale of real estate
- Notaries and registrars of property, commercial and personal property
- Lawyers, solicitors or other independent professionals when they participate in the design, execution or advice of transactions on behalf of clients concerning the purchase and sale of real estate
You can consult all the obligated subjects in the Documento consolidado BOE-A-2010-6737.
HOW DOES MONEY LAUNDERING AFFECT THE SALE OF A HOME?
The intermediaries involved in a property purchase-sale operation, such as those mentioned in the previous section, "are obliged to justify and control the origin of the funds in order to prevent the laundering of money from illegal activities and to report any irregularities".
This control is carried out by signing a document (obligatory for both parties, buyer and seller) which includes, in addition to all the financial data of the buyer, whether the origin of the funds is their own or another's.
On the other hand, it is also necessary to determine the country of origin of the current account (national or foreign). All this information will be notified to the tax office.
HOW ARE THESE CHECKS CARRIED OUT?
As explained in this article from Inmonews, the verification of the origin of the funds is done through a series of procedures:
- The customer is asked to state in writing what percentage of own funds and/or bank financing he will use in the purchase
- The client must provide the documentation that effectively proves the origin of these funds
- Enhanced due diligence measures" are applied when there is a risk factor due to the profile of the customer or the characteristics of the transaction
- Checks are made using compliance programs and "Know Your Costumer" (KYC) forms
In the case of suspicions of the origin of such funds or of an attempt to launder money, the tax authorities must be informed. Otherwise, fines can range from 150,000 to 10,000,000 euros.
WHICH OFFICIAL ENTITY IS IN CHARGE OF MONEY LAUNDERING CONTROL?
In Spain, the entity in charge of monitoring and coordinating the fight against money laundering in property purchase and sale operations is Sepblac (the Executive Service of the Spanish Commission for the Prevention of Money Laundering and Monetary Infractions).
It is the only one in Spain and has received the highest international rating as a "Financial Intelligence Unit that functions properly and carries out high quality operational and strategic analyses".
You can find out more details about this entity in itshomepage.
WHAT ARE THE RECOMMENDATIONS ON INTERNAL CONTROL MEASURES FOR THE PREVENTION OF MONEY LAUNDERING?
Sepblac itself has prepared an extensive document consisting of a brief regulatory framework, a section on general principles and a final section of greater detail specifying the internal control recommendations for the regulated entities.
You can download it directly fromthis link.
If you have any doubts or questions regarding the prevention of money laundering, our real estate agents (who are in constant training) will be delighted to help you. Get in touch with us!
Main image: David Schwarzenberg en Pixabay.
