Source of Funds - A Conveyancer Obsession

Why does your Conveyancer want so much detail regarding the monies you invest in your property? Why do they have to be so intrusive?

Pay slips, P60s, Bank and Savings Statements. All are fair game. Evidence of your inheritance, lottery win or property sale demanded. These are incredibly sensitive and confidential documents.

THE WHY?

Blame the criminals, fraudsters and scammers whose schemes are incredibly sophisticated. To combat this the Government has made Conveyancers and Land Registry the frontline in the fight against Property Fraud, Money Laundering and Identity Theft.

Government set regulations require Conveyancers to check Source of Funds and Source of Wealth* or risk being struck off or serving prison time. Along with everything else that Conveyancers must do, this is yet another time-consuming hurdle that has been foisted upon us. One that we do not want and one that is incredibly distressing for our clients.

We are not financial experts or forensic accountants. We are not FCA regulated. It is not our area of expertise and we do not wish to snoop through your financial records. Yes, it is incredibly intrusive. No, we do not want this. We have no choice. Our hands are tied by our Regulators.

Why does this responsibility not rest with banks, financial advisors, lenders and mortgage brokers? It does seem unfair to dump this solely at the poor Conveyancer's door. Additionally we are left dealing with the offence it has caused.

Compliance, due-diligence, Source of Funds, AML and ID checks all add to the time it takes to get to the finish line and to complete your Conveyancing matter. It is time consuming for us and unpleasant for you. But we are where we are.

(*Source of Funds and Source of Wealth means not only where your funds are held but how you accrued them. A paper trail is required to be held on file and must cover each and every account involved. Even if you have done this with your mortgage broker, you will need to do it again for your Conveyancer since the information is rarely shared)

REGULATIONS REQUIRE US TO CHECK:

• How and from where did the client get the money for this transaction? It is not enough to know the money came from a UK bank account.

• Why and how does the client have this amount of overall assets?  How did they accumulate / generate these funds? 

• Why the client(s) has such wealth and an assurance that it has been obtained legally. Again we must have evidence on file.

• We must also consider if it is plausible.

NB: A COMMON SCAM

It is incredibly unlikely for your Conveyancer to change banks mid-transaction. You will have provided money on account at the beginning of the matter so you will already hold the firm’s bank account details. Beware of emails requesting funds should be sent to a different account. This is a well know ploy called "Payment Diversion Fraud". The law firm’s bank details will remain the same throughout. If in doubt telephone them to check. Emails can easily be hacked, intercepted or cloned.

See ACTION FRAUD for more details on this.