Online KYC checks help estate agents battle rising fraud

As an estate agent, you should of course be performing robust Know Your Customer (KYC) checks as part of your Anti-Money Laundering (AML) compliance.

But the steady rise in property fraud over recent years, combined with a noticeable spike in cases during the pandemic, makes vigilance more important than ever.

Figures from fraud prevention service Cifas shows that mortgage fraud by production of false documents increased by 14% in the first six months of 2019, while a recent report from the Solicitors Regulation Authority (SRA) stated that conveyancing fraud was the biggest single source of suspicious activity in 2020, worth a potential £200 million.

The challenge of KYC checks for estate agents

A particular challenge for estate agents is how to conduct robust KYC checks while keeping up with changing requirements and managing limited resources.

Larger organisations, major banks for example, often dedicate over 10% of their budget to regulatory compliance and governance. But estate agents, usually lack the large teams or sizeable budgets needed to carry out these critical checks.

Another challenge currently facing estate agents is how to speed up KYC checks without compromising security. The pandemic, and consequent social distancing regulations, have slowed down the buying and selling process – much to the frustration of all parties.

The last thing estate agents need now is to have to spend longer on KYC checks, through inefficient processes. So, how can agencies implement a fast, efficient and robust AML compliance procedure in these challenging times?

How technology can help

Smaller agencies have traditionally relied on manual processes for KYC and AML checks. But manual checks can be time-consuming, inconsistent, and even based on outdated information. And of course, they are resource heavy and time consuming – especially if documents have to be received and returned by post.

A more modern and effective approach is to use an automated KYC service. Digitising checks and introducing technology is increasingly common. This is demonstrated by the new Safe Harbour standard, recently announced by HM Land Registry.

The good news is that technology is no longer reserved for large businesses. Agencies of all sizes can use automated KYC systems to carry out straightforward and affordable KYC checks online.

An automated AML service can help you comply with the latest legislation, strengthen your identity verification and even improve the on-boarding experience for your customers. Here are just some of the benefits that technology could bring:

• Reduce effort

Capturing customer information through an automated system makes compliance simpler and gives you a consistent, robust process. Clear, downloadable reports also make the results easy to understand and enable you to quickly demonstrate your AML compliance for an internal audit or visit from your regulator.

• Save time

Online AML platforms can carry out KYC checks in minutes. What’s more, with electronic identity verification, you no longer need to manually check, or store paper documents – the records are kept for you. Many providers offer the same service level agreement to all businesses, to ensure AML compliance is quick and easy no matter what size you are.

• Make checks from anywhere

You can access online KYC check services from any smart device or PC. This allows you to easily capture and upload an image of a client’s ID, wherever or however you meet them - in person or online. Some KYC providers also offer additional features. Remote upload, for example, allows clients to share ID documents over a secure link. For higher-level security checks, facial recognition software can be used to match a buyer or seller’s selfie with the photograph in their identity document.

• Enjoy peace of mind

With access to industry-leading technology, you can enjoy greater confidence in your protection from fraud. TrustID’s online KYC checks, for example, start with best-in-class identity verification. We assess the authenticity of identity documents from across the globe using a combination of AI, biometrics, and human expertise. This saves you from the need to train and maintain in-house document experts, reduces your chance of approving fake documents and prevents property owners and buyers from using a fraudulent identity to buy and sell properties.

• Only pay for what you use

Investing in new services or technology during uncertain times can be risky, but some ID service providers offer a low minimum order and don’t tie you in to long-term contract. Look for a KYC checking service that offers modular features that you can add over time as your requirements change, or a pay-per-check pricing model that lets you scale up or down with your customer demands. 
Remaining compliant with KYC and AML regulations will always be an issue – but thanks to new affordable technology, there are now alternative options for KYC checks that are convenient and robust, and accessible to agencies of all size.

In fact, smaller estate agents could arguably benefit the most from automated KYC checks, as they offer a quick and easy way to comply and therefore leave you more time to focus on renting and selling properties.

*Tony Machin is CEO of TrustID