Client Money Handling / AML

Question 1

RICS requirements for money handling?

Answer 1

In line with RICS Client Money Handling October 2019

 client money must be protected
 client money must be held in a separate client account
 client money used for agreed purposes only
 firms must have procedures and policies in place

Question 2

What key components do the RICS require in a money handling procedure?

Answer 2

RICS Professional Statement on Client Money Handling, October 2019 requires the following:

• Client must always have access to the funds
• Client money is separate and clearly identifiable
• Interest on the account must be agreed with client first
• Account must not be overdrawn
• Controls in place to keep account secure
• Competent and knowledgeable staff to process clients’ money with cover provided for long term absence
• Client ledger must be maintained
• Annual audit and reporting obligations by certified accountant employed by RICS
• RICS Regulatory Review Visits can be undertaken by RICS usually on a routine 3 yearly basis

Question 3

What is FG’s client money handling procedure?

Answer 3

1. All clients’ money is protected
2. Held in a separate client account
3. Client money is only used for the purposes that have been agreed between client/firm
4. Staff are competent

Question 4

What is a bank mandate?

Answer 4

A bank mandate is:
- Created when the account is set up
- Contract between bank and account holder
- States rights and obligations of the firm
- States the names of authorised signatories

Question 5

What is unidentified client money?

Answer 5

Unidentified client money is where the beneficiary is unknown or
cannot be traced, preventing payment to the client.

Question 6

Types of client account?

Answer 6

Discrete client account
Money held belonging a single client of the firm

General client account
Money held belonging more than one client of the firm

Question 7

How long must you retain client accounting records?

Answer 7

6 years minimum
RICS recommend 15

Question 8

What is money laundering?

Answer 8

Money Laundering is the process of exchanging criminally obtained money or assets (criminal property) for clean money or assets with no obvious link to their criminal origins.

Question 9

Main money laundering legislation?

Answer 9

 The Money Laundering and Terrorist Financing Regulations 2019
 Proceeds of Crime Act 2002
 Criminal Finances Act 2017

Question 10

What identification do you require on a client to do Customer Due Diligence?

Answer 10

Private: identify client and their identity based on a reliable independent source (e.g. passport or driving licence). Proof of address (e.g. bank statement, council tax statement) not more than 3 months old

Company: certificate of incorporation, full name, company number and address of registered office (names of directors and beneficial owners as anyone who has a shareholding of 25% or more)

Question 11

What is FG’s AML procedure?

Answer 11

1. If I had a ML suspicion, I would not make client aware of suspicion
2. Discuss with partner in charge
3. Complete and send FG’s suspicion report form to MLRO & await their further instruction
4. MRLO decides if to take to the Financial Conduct Agency (FCA)

Question 12

Who is FG’s MLRO?

Answer 12

Alistair Dunne

Question 13

RICS text on Money Handling?

Answer 13

Professional Standard - RICS Client Money Handling, 2019

Question 14

What to do with unidentified client money?

Answer 14

Hold in seperate account for 3 years
Donate to charity
Must obtain receipt