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09 April 2021

Following the publication of a report by the Solicitors Regulation Authority board which says suspicious activity worth £200m was reported to NCA last year, Martin Cheek MD at SmartSearch commented: “Since the outbreak of the global pandemic we’ve been aware of an increase in money laundering activity and the property market has been the prime target for criminals.

“Fraudsters have always considered house purchases as an effective way to launder cash but this has been exacerbated by the gaps in security that have opened up in the past 12 months due to an end to face-to-face meetings with new customers.

“Conveyancers and brokers have been relying on manual methods of ID verification which have involved taking a photo of a passport and sending on email, which is an open invitation to criminals with the ability to make sophisticated forgeries.

“The Solicitors Regulation Authority says that the increase in fraud is down to better awareness and reporting, but there has undoubtedly been an increase in criminal activity in the property market since the pandemic.

“Looking ahead, if the sector is going to prevent fraud and money laundering more effectively, there needs to be a wholesale shift to digital solutions for ID verification, which are more accurate, efficient and compliant with FCA guidelines.

“It’s no longer good enough to rely on manually checking over hard documents when they can so easily be forged and allow fraudsters into the process through the front door.”