Purplebricks has begun charging buyers and sellers a £60 fee for anti-money laundering (AML) checks.
An online message to potential buyers interested in making an offer on a property, seen by Estate Agent Today, shows the fee must be paid to its partner Lifetime Legal so it can complete AML checks before a memorandum of sale is issued.
The note said: “It’s our responsibility to ensure checks are carried out correctly for ongoing monitoring.
“However, our partner Lifetime Legal, will carry out the initial checks on our behalf.
“They will call you once a seller has accepted your offer on their property.”
The message adds that Purplebricks will receive some of the payment taken by Lifetime Legal to “compensate for our role in providing these checks.”
The charge has been criticised by other agents after it was discussed in a LinkedIn post by Ross McKenzie, previously a training director and regional director at Purplebricks responsible for Wales.
He told Estate Agent Today: “Traditionally, Estate agency in the UK isn’t exactly the most trusted of industries.
“However, today you’ll see lots of fantastic startups trying to break that mould in becoming a local, trusted and reliable property experts.
“It’s situations like this that drags those startups back.”
McKenzie, who now runs his own agency brand Isla-Alexander Property, said he pays just £4.75 for AML checks and does not pass these on to the buyer.
He added: “There are lots of fantastic people at Purplebricks but someone has to read the room, hold their hand up, and take responsibility for a poor decision that negatively impacts their agents and clients.”
A spokesperson for Purplebricks told Estate Agent Today: "In line with a growing number of other agents we use an external provider for customer AML checks.
"Through our partner Lifetime Legal we charge sellers and buyers a modest administrative fee of £60. For buyers this is just after an offer is accepted.
"Full disclosure is made in advance and all proper procedures are followed. Moving home is one of the biggest decisions a family can make and ensuring a fully compliant purchase with robust AML checks offers a high degree of assurance to our vendors."
South Yorkshire and North Derbyshire estate agency Redbrik has launched a campaign to...
The Sunday Times claims 5,000 estate and letting agents have quit...
Agency software provider Alto has announced a new partnership with home...
Regional agent Redbrik is celebrating a string of successes as it...
The predictions game can be tricky. Sometimes you just don’t know...
Leading UK property auctioneer Bond Wolfe has broken through the £100...
Uncertainty triggered by the new Labour Government and taxation concerns that...
In today's rapidly evolving property market, the focus on reducing transaction...
.png)
An exciting new collaboration between TVPN, EstateApps and Paul Long is...
By Mike Bilboe, Face For Business Buying or selling a home can...
LSL Estate Agency Franchising is home to one of the UK’s...
.jpg){kind=logo}
B-hive Block Management Partners Celebrates Major Milestone With Over 100 Businesses...
.jpg)
Tell us a little bit about National Home Move. We are a...
If you’re thinking about becoming an Estate Agency franchise or converting...
Estate agents and lettings agents have a legal obligation to protect...
.png)
Who are you and what does it say on...
Who are you and what does it say on...
Who are you and what does it say on...
.jpg){kind=avatar}
Join the conversation
Jump to latest comment and add your reply
Is everyone coming to see me in person at the two day London Proptech Show - I am the master of ceremonies so you know it is going to be good.
If they were been open it would say how much if that charge goes to PB I read it online it says some of the charge goes back to PB that’s not open at all
I am surprised that Lifetime Legal, who has built its business providing an excellent range of products & services to independent estate agents, wants anything to do with a tarnished corporate brand such as Purple Bricks.
They share a NED - I think that probably has as much to do with the decision as the financial gain. In fairness to Lifetime Legal - it is their Smart Compliance product which is much better (and more costly) than a basic AML ID check that many agents use so not comparing like with like.
How it is sold and the "mark up" aspect is the key issue though.
Making £30 or so on an AML product won't change the fortunes of Purplebricks who IMO still need to re-establish a clear differentiated market proposition and transactional volumes
Agents need to consider the true cost of AML checks to their business, its not just the cost of an individual check, which will be a minimum of £10.00 per transaction and more if sales fall through, its the cost of registering for AML supervision with HMRC at £600 per branch, processing time, the cost of training staff and the additional insurance costs. Also, to keep costs down, AML checks are often bought in bulk and they are not always used up. Don't forget, this is something imposed on agents by HMRC which costs their businesses both time and money to implement, why should agents just have to suck up the extra costs without passing it on to the customer in some way.
Well, they charge for everything else they do, why not add to the bundle! They charge, the public pay. Its foolishness but most clients selling homes do not have the insight we have, sadly. The cost of an AML check if completed by a company is on average around £3.50, their profit, although not transparent, will be probably 4 or 5 times that. We can criticise but its an easy way of making a profit.
The cost of an AML check is not simply a basic ID, PEPs and Sanctions check which might be £2-5 a person (often without photo or NFC chip checks). There is the need for a risk assessment, HMRC registration, staff time etc.
Hopefully in the near future we will see the Digital Trust Framework mean that these checks can be shared between appropriate parties as customers/clients often having to go through same/similar process with agents, conveyancers and lenders - the latter two of which normally charge.
Michael, a prospective buyer may well pay their lawyer a fee to cover the cost of AML checks, but the buyer did not instruct the estate agent, which is to say they are not the agent's client. Where agents need to carry out AML checks with a third-party cost, this should come out of the fee charged to their client, the seller. After all, it is the cost of doing business, i.e. selling a property.
Customers have to go through the IDV & AML process up to 5 times in the home buying and selling process. This is a duplication of effort, contributes to delays in the process, multiple charging for the same activity, and is a high cause of friction for people. Combined with this people should have the right to own their own identity credentials and control who they share them with. The process is fundamentally changing through industry supported schemes aligned to the DCMS Digital Identity & Attributes Trust Framework. As one person said 'ID checks are currently a joke, I have provided 12 different forms of ID and problems with them all'. The industry either needs to work together to improve these sorts of compliance issues or continue to enjoy the same problems and criticisms of the home buying and selling process.
Getting back with your ex lover,urgently with love spell
@Bryan_lovespell Call/WhatsApp:+2348074066640 is really the
best spell caster with 100% guarantee..
Please login to comment