Islamabad: The government has taken steps to register all tax filing realtors as Designated Non Financial Business and Professionals (DNFBPs), this has been done to meet the demands of Financial Action Task Force (FATF). These DNFBPs have also been directed to fill out all the details of their clients and property related transactions.
Approximately 20,000 DNFBPs, have been instructed to fill out a four page questionnaire, comprising 86 questions, within seven days. As per a notice sent to all the real estate agents, “In case of non-compliance or partial compliance, action as per law will be initiated”.
The FATF criteria for property details are required at a time when the Prime Minister’s construction package is still in place, under which the source of income of the investors would not be asked.
The Federal Board of Revenue, under the SRO 924, has nominated various professionals as DNFBPs to meet the requirement set by FATF regarding money laundering and counter-financing of terrorism (AML/CFT). The real estate brokers are required to fill out the information related to client relationships and services. They are required to report transactions with high-risk clients, individuals who are in contact with politically influenced or high net worth individuals, especially those who belong to areas or countries of concern.
They would also need to report if they have been in direct contact with the customers, and the method of payment used, along with risk assessment, to guarantee whether risk mitigating factors are in place, complying with FBR and AML regulations.
Additionally, the real estate agents have been asked to pinpoint the clients and report their transactions related to “high-risk countries or areas of concern or the border areas of Khyber Pakhtunkhwa and Balochistan as well as South Punjab”.
The brokers are also instructed to identify if the potential clients have been rejected by exiting clients because of high-risk. Furthermore, they have been instructed to issue suspicious transaction reports (STRs) and currency transaction reports (CTRs) to the Financial Monitoring Unit (FMU), relating to the highlighted entities.
The AMLA required obligations also apply to DNFBPs, including the lawyers and other legal professionals providing services to clients, real estate agents, when a transaction exceeds two million in cash.
This would help the professionals keep track of all the transactions between the clients and real estate agents, not giving space to any fraudulent activities.