Today is the day, 14 May 2025, that letting agents across the UK become subject to new financial sanctions rules.
These are part of updated government legislation aimed at preventing individuals or organisations on the UK sanctions list from accessing the UK housing market.
It’s a significant enough change, and in many ways is a serious change – especially considering the implications to letting agents for any breach.
But for most landlords and tenants, it won’t cause any disruption at all.
At Petermans, we have been working behind the scenes to ensure that we are already fully compliant in advance of the legal switchover today, with all the right systems in place.
Nevertheless, with change comes curiosity, questions and – the natural cousin of questions – uncertainty.
So here’s what you need to know, in plain English.
This change is something I have written about before (see article here) – but I thought it would be useful to outline what it means for tenants and landlords, rather than for the industry.
From today, letting agents have joined a long list of other types of business which are classed as being “relevant firms” under UK financial sanctions law.
It means that we have a legal duty to:
This is a legal requirement.
It applies even if the landlord or tenant doesn’t realise they’re on the list.
And more than that – for us, as agents, it really does matter, because this legislation works on a strict liability basis. If we (letting agents) drop the ball and miss a match, allowing a sanctioned individual or entity slip through the net, then we face prosecution, enforced by the Office of Financial Sanctions Implementation (OFSI) – even if the mistake were unintentional.
In other words: it is critical we make sure policies and processes are in place.
If you're a landlord, we might be asking you for ID or additional verification – especially if you have recently moved to the UK or have overseas interests.
Agents are not legally required to verify ID for every landlord or tenant under the new sanctions rules, but from our point of view – and not least because of the nature of this change, being a ‘strict liability regime’ – we do need to be confident in who we’re dealing with.
At Petermans, we have opted to take a proportionate yet cautious approach. We will therefore be checking full names against the official UK sanctions list, and in some cases that will mean having to verify identity if there’s any uncertainty.
These checks are quick, discreet, and designed to protect everyone involved.
If you're a tenant, you may notice one or two extra checks at the application stage, particularly if you're renting for the first time or have a non-UK background.
Similar to the sort of checks we would make on a landlord, these checks are quick, non-intrusive, and confidential.
Most tenants won’t notice anything different at all. It’s part of our compliance process – just like referencing or Right to Rent checks. In fact, if you have rented with us previously, we will actually be using the same provider that you dealt with for references – so the process should seem familiar from the start.
Realistically it amounts to an extra check at our end, but from a tenant’s perspective it will not feel much different to the process we would have gone through previously.
We’ve made sure that our team is fully trained, and our systems are up to date, using an existing service provider to implement the new checks, which brings a level of familiarity to ourselves and our clients.
Here is a quick breakdown of what our process will include:
We’re taking it seriously because it matters. These laws are designed to protect the integrity of the housing market.
As aggravating as it seems to have been for the industry, at the end of the day we recognise that there is a problem, and that we can be part of the solution.
When it gets put that way, we are happy to be doing our part.
This is not a consent issue. We do not need landlords or tenants to give us consent to carry out these checks. It is a legal requirement.
Nevertheless, we respect privacy and we are absolutely committed to handling your data sensitively and securely.
All checks are carried out in line with our privacy policy, which is available on request.
The difference really is all behind the scenes. You as landlords or tenants won’t see much has particularly changed, but rest assured: we’re doing things properly.
If you are letting your property with ourselves, or renting your next home through us, you can have full confidence that Petermans is absolutely on top of this latest change to regulations – but also committed to protecting your privacy and interests.
If you have any questions at all about this new legislation or how it might affect you,
here below is a useful FAQ that should help answer to any burning questions.
Financial sanctions are legal restrictions imposed on individuals, companies or organisations linked to activities such as terrorism, war, or serious financial crime. If someone is named on the UK sanctions list, letting them rent or manage property in the UK is illegal.
From 14 May 2025, all letting agents should check whether landlords, tenants or guarantors appear on the UK Sanctions List. If there’s a match, they must report it — and the deal cannot proceed.
We will be screening without prejudice:
If there’s a positive match, we must notify the Office of Financial Sanctions Implementation (OFSI). That tenancy or instruction will be frozen and cannot proceed. Penalties for non-compliance can include heavy fines.
No. In Lettings, AML rules apply to agents dealing with property over a certain rental value per month (currently €10,000 – but this has been subject to discussions at a high level and may change or the threshold be removed in order that all rentals become subject to AML regs). These new financial sanctions rules apply to all letting agents, regardless of property value or location.
Not always, but sometimes. We use a proportionate approach; if we need to verify someone’s identity to rule out a match, we will do so. It is quick, secure and only used for this purpose.
Sanctions checks are separate to other checks and are checking against other things (for different reasons). Even if you have passed other checks, we still need to confirm that no one involved appears on the sanctions list.
No. This is not optional and is non-negotiable – it is our legal obligation. However, we are fully compliant with data protection law, and your information will be handled securely and appropriately.
We have invested in staff training and specialist software, updating our existing internal procedures to reflect the change. We looked into various options and have proceeded with the one that made the most sense, but which also provides familiarity not just to our clients, being through an existing provider, but also to ourselves, meaning less room for error.
For the majority of people, not in any way at all. These checks are done quickly in the background and only cause disruption if there is a match. You won’t even notice them unless we need more info.
Get in touch. We’re here to help landlords and tenants navigate these new rules with clarity, professionalism and care.
020 8958 5040
edgware@petermans.co.uk
We are required by law to conduct anti-money laundering checks on all those selling or buying a property. Whilst we retain responsibility for ensuring checks and any ongoing monitoring are carried out correctly, the initial checks are carried out on our behalf by Lifetime Legal who will contact you once you have agreed to instruct us in your sale or had an offer accepted on a property you wish to buy. The cost of these checks is £60 (incl. VAT), which covers the cost of obtaining relevant data and any manual checks and monitoring which might be required. This fee will need to be paid by you in advance of us publishing your property (in the case of a vendor) or issuing a memorandum of sale (in the case of a buyer), directly to Lifetime Legal, and is non-refundable. We will receive some of the fee taken by Lifetime Legal to compensate for its role in the provision of these checks.