Datanamix | AML Sanctions Screening

AML Guide for the Real Estate Industry

Money laundering is a concern in many industries, and real estate is no exception. This guide will help you understand the AML considerations for the real estate industry and why implementing these practices are so important.

AML Guide for the Real Estate Industry


You may be wondering why real estate agents have to comply with anti-money laundering regulations. Theyโ€™re not a bank, right?ย 

In fact, real estate transactions are one of the most common methods that criminals use to launder money and move around illicit funds. Estate agents are required to comply with AML regulations to prevent illegally obtained funds from being passed through them.

Here's why the real estate industry is a prime AML target:


Since real estate transactions tend to involve large sums of money, it is tempting for money launderers to attempt to conceal a significant amount of illegal funds at one time.
It can also be simple for criminals to conceal the identity of the owner of the property being purchased or sold.
The fact that property markets tend to appreciate makes this even more appealing.

Here are some of the AML risk areas relating to real estate:



Cash-only transactions


The purchase of a property with cash is one of the highest risk areas that real estate firms need to conscious of. The perpetrators may make payments from several different bank accounts to avoid reporting thresholds.


Shell companies, trusts & third-party purchases

Since companies, trusts, and other third parties can purchase real estate, there is a risk that money launderers can use them to distance themselves from the transaction.



Manipulating valuations


Criminals could partner with a real estate agent who overestimates – or underestimates – the value of a property so that the difference can be settled in cash. 



Falsified leases


Another money laundering scheme in real estate involves leasing a property to a tenant who pays the “rent” with the illicit funds that were provided to them. This would then make those funds look like legitimate rental income. 



Mortgages and AML

A criminal can take out a mortgage on a home to make the transaction appear legitimate, only to then pay off the loan with illicit cash sometime later.


AML requirements for Real Estate companies

As you can see, real estate companies play an important role in detecting and preventing money laundering. As a result, they are subject to AML requirements and are regulated by the HMRC. This means that they must follow their guidance on how to prevent financial crimes and comply with the rules that they set forth. Failure to do so can result in significant fines and penalties.

These requirements include:

Employing customer due diligence measures

As we mentioned above, real estate transactions are appealing to money launderers because they can remain anonymous or distance themselves from the entity making the purchase.

To prevent this, real estate firms are required to have customer due diligence measures in place that will allow them to confirm the identity of all individuals who will have significant control over the property transaction.

If somebody is selling, buying, or leasing a property, all buyers, vendors, lessors, and lessees need to be properly identified. Companies can do so by obtaining information like their names, addresses, and legal documents that prove their identities.

Once the real estate company has identified these individuals, they must perform sanction screenings and PEP checks to determine the risk level associated with doing business with them. If they appear on one of these lists, the real estate transaction has inherently greater risk – and the firm should have proper procedures in place for dealing with this.


Hiring a money laundering reporting officer

All companies in the real estate industry are required to employ a money laundering reporting officer. This person is responsible for ensuring the firm complies with AML regulations and that their procedures are up to date with industry best practices.

Similarly, this person can lead training sessions for the rest of the employees to ensure that they are also aware of which type of real estate transactions are at a higher risk of being used for money laundering.


Reporting suspicious transactions

As a real estate agent, if you believe that a real estate transaction is being used for money laundering or other illicit purposes, you must complete a suspicious activity report and send it to the applicable agency. 


Applications for the real estate industry


The increase in money laundering that has occurred the real estate transactions means that AML regulations will continue to be imposed on the real estate industry. Companies must work to ensure that they meet all of the standards that apply to them so that they can avoid costly fines and penalties. 

It is essential to set up the appropriate processes and procedures in place to prevent money laundering and terrorist financing, so investing in the right tools and technology early on will set you up for success in the future.


The Sanctions & Crime Data API for the Real Estate Industry


This is a comprehensive Anti-Money Laundering solution with a simple to integrate API that the Real Estate Industry can use to continuously scan their clients and business partners against the most important Sanctions & Crime Lists.

Sanctions lists


Our Sanctions Database covers Sanctions Lists from OFAC, Canada, HM Treasury, EU, Australia and many more regions and organisations globally.

Supported Sanctions Lists

PEP data


Our Politically Exposed Persons (PEP) database covers about 1million records from every country worldwide. Lists also include family members and close associates of PEPs.


Global PEP Data

Crime Watchlists


Our Crime Database includes more than 8k records from Interpol and the FBI. More Watchlists are being added continuously.
*Only available on our Standard Plan

Crime and Watchlist Data

Adverse media


Bolster your AML compliance with our global adverse media data screening. Screen against more than 60k global news sources with custom keywords.

Adverse Media

Key Industries Solutions

We provide vital support to compliance teams across a wide array of sectors, including FinTechs, enterprise SaaS providers, InsurTechs, cryptocurrency firms, and many more.

For a detailed guide on how AML Sanctions Screening applies to your industry, click the relevant icon below.


Global Sanctions Lists

The sanctions lists below are included in every sanctions data subscription. Additional sanctions lists can be included on request, please contact support for more information.

United States

Office of Foreign Asset Control (OFAC)

Specially Designated Nationals (SDN), Consolidated Sanctions List (Non-SDN) and various additional sanctions lists (MBS, CCMC, CMIC, CAPTA, FSE, PLC, SSI).

Canada

Global Affairs Canada

Consolidated Canadian Autonomous Sanctions List incl. Special Economic Measures Act (SEMA) and the Justice for Victims of Corrupt Foreign Officials Act.

United States

Department of State (DoS)

ITAR Debarred (ITAR), Nonproliferation Sanctions (ISN), Cuba Restricted List.

United States

Bureau of Industry and Security (BIS)

Entity List (EL), Denied Persons List (DPL), Military End User List (MEU), Unverified List (UVL).

United States

Financial Crimes Enforcement Network (FinCEN)

311 Special Measures.

United States

Department of Homeland Security (DHS)

Uyghur Forced Labor Prevention Act Entity List (UFLPA).

United States

U.S. Customs and Border Protection

Withhold Release Orders.

Argentina

Ministry of Justice

Public Registry of Persons and Entities Linked to Acts of Terrorism and Financing (RePET).

Brazil

Brazil Central Bank

Register of persons disqualified from senior roles, and Entities Prohibited from Offering Auditing Services.

Brazil

Brazil Federal Government

Empresas Inidรดneas e Suspensas (Disreputable and Suspended Companies).

Brazil

Brazil Tribunal de Contas da Uniรฃo (TCU)

List of individuals disqualified from public service and debarred bidders.


* Additional sanctions lists can be added on demand. Just reach out to our Customer Success Team.

Politically Exposed Persons

What are Politically Exposed Persons (PEPs)?

Domestic Politically Exposed Person (DPEP)

These are individuals who hold prominent public positions within their own country.

This includes:

  • Heads of state or government
  • Senior politicians, government ministers, and judiciary officials
  • Senior executives of state-owned corporations
  • High-ranking military officials.They are classified as DPEPs due to their potential access to public resources, which could make them vulnerable to corruption or abuse of power.

Foreign Politically Exposed Person (FPEP)

These are individuals who hold, or have held, similar high-level roles in foreign countries. FPEPs are foreign officials or their associates who might also be in a position to abuse their influence for personal or financial gain.

Examples include:

  • Foreign heads of state or government officials
  • Senior politicians or diplomats from foreign governments
  • Foreign judges or military leaders

Domestic Politically Influenceable Person (DPIP) - Family Members

These are close relatives of Domestic PEPs (DPEPs).

Family members can include:

  • Spouses or partners
  • Children and their spouses or partners
  • Parents, siblings, or other close relatives. Due to their relationship with a politically exposed person, they may have access to privileged information or influence, which makes them susceptible to exploitation or corruption.
  • Close associates are individuals who are closely connected to a PEP, either socially or professionally.

Foreign Politically Influenceable Person (FPIP) - Close Associates

These are individuals who maintain close business or personal relationships with Foreign PEPs (FPEPs).

A close associate could be:

  • Business partners
  • Close friends or advisers
  • Legal representatives or those with significant control over a PEPโ€™s assets FPIPs are often involved in business dealings or transactions that may raise concerns about conflicts of interest or the misuse of political connections.
  • Close associates are individuals who are closely connected to a PEP, either socially or professionally.

Each of these classifications is used in anti-money laundering (AML) and know-your-customer (KYC) processes to identify and mitigate risks associated with potential corruption or financial crimes. Identifying these individuals helps institutions flag potentially suspicious activities that may be linked to political influence.

Smart screening technology for effective AML compliance

Less False Positives and False Negatives


Name matching is the real challenge in Sanctions & AML compliance. Transliteration issues, nicknames, honorifics, and spelling errors are some of the factors that make name screening a challenge. This cannot be solved with simple fuzzy algorithms.

Our industry-leading screening technology is based on the latest research and achievements in Natural Language Processing (NLP) and Artificial Intelligence (AI) used by organisations such as Amazon, LinkedIn, and U.S. Homeland Security.


This technology helps reduce false positives significantly, while making sure that no real matches slip through the cracks.

Easily integrated into your own system environment

Integrate Business Partner Screening with your own system environment by simply using our REST API, our Sanctions Database Exporter option, or our pre-built integrations for SAP, BigID and API3 Airnode.


Sanctions & AML API


Developer friendly, easy to implement and Enterprise-ready RESTful API with a guaranteed uptime of more than 99.99% and > ~200ms response time.


Batch AML


Through batch verification, businesses can efficiently manage and update large volumes of data, ensuring compliance with ease.


Integrations


Easily integrate our AML sanctions screening into your system environment using our pre-built connectors and apps.

Crime Watchlists

Complement your AML Screening with Criminal Watchlists Data



FBI and Interpol Data


Gain access to our comprehensive global Criminal Watchlists database covering more than 8k records.


Updated Every 60 Minutes


Mitigate sanctions risk with hourly data updates. Audit relevant timestamps for increased transparency.


Smart Matching Technology


Maximise the benefits of our screening technology: Significantly reduce false negatives and false positives, and boost accuracy.


FBI and Interpol Watchlists


Image

FBI's Most Wanted & Fugitives


The FBI's Most Wanted list is maintained by the FBI and publicly available on their website. Removal from the list typically occurs only upon capture, death, or dropped charges.

*Only available on our Standard Plan

Why AML compliance is important

For businesses to actively prevent financial loss and reputational damage, it's crucial that comprehensive due diligence processes are carried out. 

Datanamix’s due diligence product suite includes AML (anti-money laundering) sanctions screening, PEP (PIP) data, Adverse Media and Crime data – all customisable depending on your specific industry, and unique business needs.


Datanamix offers a suite of AML Sanction Screening products to enable the right level of risk mitigation for every class of business – from accountable institutions bound by the FIC Act, to SMEs simply looking to protect their interests.


Datanamix due diligence product suite includes AML (anti-money laundering) Sanctions Screening, PEP (PIP) data, Adverse Media and Crime Data โ€“ all customisable depending on your specific industry, and unique business needs.

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Adverse Media

Adverse Media Screening is the process of monitoring public sources, like news and social media, to detect negative information about individuals or organisations. It helps businesses identify risks such as criminal activity, fraud, or regulatory violations, which could harm their reputation or legal standing. Used for risk assessment and compliance (e.g., anti-money laundering or Know Your Customer regulations), adverse media screening is often automated to handle large volumes of data and provide real-time alerts. It's a key part of due diligence and risk management strategies.

60k News Sources


Custom Keywords


Global Coverage

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