From 14 May 2025, all UK estate and letting agents are legally required to conduct sanctions checks on landlords and tenants as part of their onboarding process. This important change in UK financial sanctions law applies to every transaction, regardless of property value, rent amount, or contract length.
If you’re a property professional regulated under the Money Laundering Regulations 2017, you must act now to ensure your business is compliant.
Who Must Be Screened?
Under the updated rules, all checks must be made against the UK Consolidated Sanctions List maintained by the Office of Financial Sanctions Implementation (OFSI).
✔ Landlords – at the point of instruction
✔ Tenants – once an offer is accepted
💡 Flex Tip: This applies even for short lets, student rentals, and low-value properties.
️What Happens If There’s a Match?
If a landlord or tenant is found on the UK sanctions list, you must:
- Report the match immediately to OFSI
- Pause the transaction until you receive clear instructions
Failure to comply could lead to:
❌ Unlimited fines
❌ Criminal prosecution
❌ Serious reputational damage to your agency
This is not optional. It is a legal obligation.
Your Sanctions Compliance Checklist
Here’s how letting and estate agents can meet the new sanctions requirements with confidence:
1. Integrate Sanctions Checks into Your Onboarding Process
- Screen landlords before accepting instructions
- Check tenants as soon as an offer is accepted
- Use trusted software or perform manual checks via the UK Sanctions List
- Document and retain all results for audit purposes
2. Update Your AML Policies & Procedures
- Add a sanctions screening section to your AML policy
- Assign responsibility for running and recording checks
- Include clear escalation steps in case of a match
3. Train Your Staff
- Ensure your team understands the difference between AML and sanctions obligations
- Teach them how to identify red flags and use screening tools properly
- Log all training and keep it up to date
4. Organise & Retain Records
- Keep proof of who checked, when, and what was found
- Store data securely, in line with UK GDPR and AML rules
- Retain records for at least 5 years, and securely destroy after 10 years where required
5. Stay Updated
- Subscribe to OFSI email alerts
- Review your risk assessment regularly
- Keep an eye on updates from HM Treasury and Companies House
Common Misconception:
“It’s only a small tenancy, so I don’t need to run sanctions checks.”
False.
Sanctions screening is now mandatory for all residential and commercial property activity, regardless of rent or length of contract. Don’t assume. Always check.
Need Help Updating Your AML or Sanctions Compliance Setup?
At Flex AML, we work with estate and letting agents across the UK to simplify compliance and strengthen internal controls. We can help you:
- Build or review your AML risk assessment
- Update your policies to reflect the new sanctions rules
- Train your team on AML and sanctions best practices
- Prepare for HMRC audits with mock reviews and hands-on support
📞 Book your free 30-minute consultation today. No jargon, no pressure. Just clear advice to help you stay compliant and confident.
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