Cutting-edge software is helping to deliver robust checks against crime
Money laundering is a topic which has been making many of us sit up and pay attention. With the European Union’s latest Anti-Money Laundering Directive coming into force in June and the UK Criminal Finances Act 2017 in September, the rules to prevent money laundering and the financing of terrorism have been reinforced.
“It’s always been a requirement to undertake money laundering checks, but new EU legislation, which came into force at the end of June, actually makes these checks far more robust,” says Gary Donaldson, head of product and innovation at land and property search organisation Millar & Bryce.
Edinburgh-based Millar & Bryce provides information on buying, selling and financing property to help the decision-making process of its clients in both the commercial and residential property markets.
“The EU rules also extend the reach of the people that are checked,” Donaldson adds.
“For example, it used to be just the seller of the property who is checked, but now it could also be the purchaser that checks are undertaken for as well.”
According to Donaldson, the Law Society of Scotland claims that “conveyancing transactions are a hot target for money launderers because it can happen quite fast and can often hide behind complex money transactions”.
However, the latest update of the software Millar & Bryce will use – AML Search, a product of Surrey-based data processing firm Searches Group – aims to recognise that.
“Clients have to have an ongoing monitoring process as it is no longer acceptable to have a one-off check of a client in place in order to ensure that if any information changes, we can make a decision based on what’s there,” explains Donaldson.
“One area is of a politically exposed person, or a PEP. The directive has widened the definition of what a PEP actually is, as unlike before, that is no longer limited to persons outside the UK.”
Despite many changes in the legislation, this update should be a potential benefit for law firms, particularly with systems such as AML Search in place.
The stricter anti-money laundering rules mean businesses must increase both ownership transparency and risk assessments and it is the advances in technology that make it all possible.
During the 1990s, computers and the internet revolutionised how information was processed and stored, and it was in that decade that the first virtual law firm was recorded.
As businesses have continued to use these tools to store and process information, there has been an increasing need for data protection legislation to be developed accordingly.
It is cutting-edge software which means Millar & Bryce, which is part of DMG Information Group, a global business-to-business information provider with revenues of almost £498 million, can offer its clients a sophisticated anti-money laundering (AML) service.
The fully electronic system allows checks to be done through an online portal which lets Millar & Bryce carry out a risk assessment against clients using details such as those found on a passport.
“We will do an electronic check and provide a report to say that the client is compliant and that there is no risk, or that there is a risk because we haven’t found enough data sources,” says Donaldson.
The software, which allows Millar & Bryce to check more than 130 million companies to ensure they are not on any sanctions list, is just the latest technological benefit to assist land and property professionals.
In 2014, it was announced that the Registers of Scotland’s digital land register would be complete by 2024.
Introduced in 1981, the land register is a map-based public document establishing the boundary of a piece of land.
Thanks to the Land Registration etc (Scotland) Act 2012, which allowed electronic documents, signatures and registration, Registers of Scotland began digitising that register in 2012.
“What that will provide is a guaranteed state warranty for every title on the register,” says Donaldson, who was formerly an account manager at Registers of Scotland.
“It will also give a definitive boundary plan and make property transactions much easier once it is on the land register.
“At Millar & Bryce, we provide a range of services that help the transition on to the land register.”
Millar & Bryce, which employs more than 120 people, has continually embraced electronic advances to improve the way it has operated since it opened 142 years ago.
“It allows us to gain business efficiencies, which has consequential benefits to clients,” says Donaldson.
“I think we are seeing generally more buoyancy and positivity in the marketplace so it’s quite an exciting time.”
This article appears in the WINTER 2017 edition of Vision Scotland. Further information about Vision Scotland here.