Anti-Money Laundering procedure: A legal obligation for real estate agencies

The goal of the Anti-Money Laundering (AML) procedure is to combat money laundering and terrorist financing. Real estate agencies, such as Nextimmo, must comply with a set of legal obligations to adhere to current regulations.

1. Client identification (Know Your Customer – KYC)

From the first contact, all essential information must be collected:

• For individuals:

  • Name, date of birth, address
  • Copy of an identity card or passport
  • Proof of address (e.g., electricity bill)

• For businesses:

  • Extract from the commercial register
  • Company statutes
  • Identification of ultimate beneficial owners (see next step)

💡 If the client is not physically present, a certified copy of identity documents is mandatory.

2. Identification of the ultimate beneficial owner (UBO)

When the client is a company, it is essential to determine who truly controls the entity.
Rules to follow:

• Any person owning more than 25% of the shares is considered a beneficial owner.
• If no individual exceeds 25%, the company’s manager is considered the UBO.

💡 Be cautious of complex structures (trusts, holdings) that may obscure the true identity of beneficiaries.

3. Client risk assessment (Risk matrix)

Each client is classified according to their AML risk level:

• Low risk: Local clients with transparent income sources.
• Medium risk: Clients from countries with weak AML regulations or complex corporate structures.
• High risk:
  • Politically Exposed Persons (PEPs)
  • Offshore companies or entities located in high-risk countries
  • Funds with unclear origins

💡 High-risk clients require enhanced due diligence.

4. Monitoring transactions and financial flows

Every transaction must be analysed to identify potential anomalies:

• Unusually high amounts without a clear explanation
• Transactions originating from high-risk countries
• Cash payments (strictly prohibited)

💡 No transaction should be approved before completing the identification process.

5. Sanctions list screening (Name screening)

Clients’ names must be cross-checked against international databases:

• Sanctions lists (EU, UN, OFAC, Interpol)
• PEP databases (Politically Exposed Persons)
• Interpol and fraud reports

💡 If a client appears on one of these lists, the transaction must be halted and reported.

6. Ongoing monitoring & reporting obligations

Nextimmo is required to report any suspicious activity immediately:

• Suspicious transactions must be reported to the Financial Intelligence Unit (FIU).
• If suspicion arises, the transaction may be blocked.
• A client may be reclassified as "high risk" if new concerning elements emerge after the initial identification.

💡 Key rule: Any communication regarding an ongoing AML investigation is strictly prohibited (No-Tipping-Off principle).

7. Data storage & retention

All client information must be retained for at least five years.

Documents to archive:

• Identity documents and proof of address
• Contracts and mandates
• Risk assessments
• Transaction details

💡 Authorities must be able to access these documents at any time.

8. Training & internal controls

All employees must receive regular training on AML obligations.

A Compliance Officer for Anti-Money Laundering (AMLCO) is responsible for:

• Ensuring proper application of AML rules.
• Reporting suspicious transactions.
• Updating AML procedures.

💡 Non-compliance with AML regulations can result in fines of up to €5 million or the revocation of the business license.

Conclusion

🔹 AML compliance is not an option; it is a legal obligation.
🔹 Many real estate agencies underestimate this risk, exposing themselves to severe penalties.
🔹 Ignoring these regulations puts your business at risk.

💡 The only solution: Implement AML procedures from the very first client contact.