AML Checks for Lettings 2025: What Estate Agents Must Do After May 14th

The landscape of lettings compliance changed fundamentally on May 14, 2025. What was once a concern only for agents handling luxury properties has become a universal requirement. Every letting agent in the UK now faces new Anti-Money Laundering (AML) obligations that could result in unlimited fines or even imprisonment for non-compliance.

If you're a letting agent struggling to understand these changes or worried about the administrative burden they create, you're not alone. 37% of letting agents say they are worried about complying with future regulatory changes, while The government's Economic Crime Plan acknowledges that over a third of businesses in regulated sectors find compliance challenging, with financial crime being one of the biggest factors hindering economic growth.

This post breaks down exactly what you need to know and do to stay compliant while maintaining efficient operations.

From 14 May 2025, letting agents are required to check tenants and landlords against the UK sanctions list, freeze any assets or property held for a sanctioned individual/entity, and report suspicious activity to the Office of Financial Sanctions Implementation (OFSI).

The key change isn’t just about expanding checks - it’s about your classification. According to OFSI's official guidance, letting agents are now designated as “relevant firms” under the UK’s updated financial sanctions regulations. You’re now in the same category as banks, law firms, and financial institutions when it comes to sanctions enforcement.

This shift brings you fully into the financial crime prevention framework, whether you manage student bedsits or luxury penthouses.

• Only agents handling monthly rents above approximately £8,300 needed AML registration
• Sanctions checks were optional for most agents
• Limited reporting obligations
• Minimal compliance burden for typical lettings

Under the new regulations, AML compliance is now required for all rental properties, regardless of the rental amount. Every letting agent must now:

• Screen all tenants and landlords against UK sanctions lists
• Report any matches or suspicions to OFSI
• Maintain records for at least 5 years
• Implement proper training and procedures

The monetory threshold for AML supervision registration remains, but sanctions checking is now universal.

Although not framed as traditional AML regulation, the government states that letting agents must have “sufficient information” to determine whether a person is designated. You must verify the identities of all adult tenants and landlords involved in rental agreements. This means:

• Valid passport or driving licence
• Proof of current address (utility bill or bank statement dated within 3 months)
• For corporate landlords, verification of beneficial owners

Every landlord and tenant must be checked against:

• The UK Sanctions List maintained by the Foreign, Commonwealth & Development Office
• The OFSI Consolidated List of Financial Sanctions Targets

If a match is identified or suspected, agents must immediately follow OFSI’s mandatory reporting instructions.

If you identify or suspect someone is a designated person (DP), you must:

• Inform OFSI as soon as practicable
• State the nature and amount of any funds or resources held
• Freeze any assets immediately
• Not tip off the individual

Letting agents must retain AML compliance records for at least five years after the business relationship ends. HMRC's guidance on record keeping specifies this must include:

• Identity verification documents
• Sanctions screening results
• Risk assessments
• Reports made to OFSI
• Decision logs (steps taken in response to findings)
• Training records

• Add sanctions screening to all new tenant and landlord applications
• Ensure ID verification happens before any agreement is signed
• Create clear documentation of all checks performed

While the legislation only talks about prospective landlords and tenants, best practice suggests reviewing current relationships when properties are re-let.

• Designate a compliance officer
• Create clear escalation procedures
• Set up direct communication with OFSI (ofsi@hmtreasury.gov.uk)
• Use the OFSI reporting form for suspicious activity

Keep up to date on Anti-Money Laundering regulations, including providing regular training to employees. HMRC's training requirements specify that every team member handling lettings must understand:

• How to verify identities correctly
• What constitutes suspicious activity
• The reporting process
• Record-keeping requirements

Manual sanctions checking is time-consuming and error-prone. Government guidance on economic crime prevention emphasises that the most efficient, cost-effective and accurate way for letting agents to comply with the new financial sanctions regulations is to use digital compliance solutions.

This is where Tenantviews transforms your compliance burden into competitive advantage. Unlike generic referencing services that bolt on compliance as an afterthought, we've built AML and sanctions screening directly into our core platform, meaning:

• One-click compliance: Every tenant reference automatically includes full sanctions screening - no extra steps, no missed checks
• Real-time OFSI screening: Direct integration with government databases ensures you're checking against the latest sanctions lists, not outdated data
• Instant digital audit trails: Every check is logged, time-stamped, and stored for the required time period - automatically
• UK-specific compliance: Built specifically for UK letting agents, not generic international solutions that miss local requirements

Why Integrated Solutions Matter

With just 2.5% of UK rental listings exceeding the old €10,000 threshold, government housing data shows the new rules represent a 40-fold increase in compliance workload for most agencies. Manual checking simply isn't sustainable.

Stay informed and compliant with these official government resources:

Core Compliance Tools:

• UK Sanctions List - Official list to check individuals and entities
• OFSI Sanctions Search Tool - Government's online screening tool
• OFSI Consolidated List - Complete financial sanctions targets
• OFSI Reporting Forms - Submit suspicious activity reports

Regulatory Guidance:

• OFSI Homepage - Latest sanctions guidance and updates
• HMRC AML Guidance - Complete compliance requirements for letting agents
• Money Laundering Regulations 2017 - The primary legislation
• 2019 Amendment Regulations - Latest regulatory updates

Reporting and Support:

• National Crime Agency - Suspicious activity reporting (SARs)
• HMRC Penalties Guide - Understanding enforcement and appeals
• HMRC Registration Portal - Check if you need to register

The May 14, 2025 changes aren't just regulatory burden - they're about protecting the integrity of the UK property market. HMRC's latest enforcement report shows estate and letting agency businesses were fined £3m last year as a result of 468 AML breaches, demonstrating that enforcement is already serious and will only intensify.

For letting agents, the choice is clear: invest in proper compliance now or risk everything later. While your competitors scramble with manual checks and risk non-compliance, you can offer landlords something better: bulletproof compliance with zero hassle.

The new AML requirements may seem daunting, but with Tenantviews, compliance becomes invisible. No extra steps, no delays, no worried conversations with landlords about legal requirements. Just fast, comprehensive referencing that happens to exceed every regulatory requirement.

By choosing Tenantviews, you're not just avoiding penalties - you're joining the UK's most forward-thinking letting agents who've discovered that proper compliance, done right, actually speeds up their business rather than slowing it down. In an increasingly complex regulatory environment, that's the edge that wins landlord instructions.