What is the money laundering document and what is the title when buying a property?

The necessary procedures to buy or sell a property are not always easy to carry out. We are aware that getting the forms, knowing where to deliver them and in what term can become a real nightmare. Customers usually come to our agency asking us about the money laundering document because they do not know what it is or what it is for. That is why we have decided to write this article in which we tell you everything you need to know about this writing in the purchase and sale of homes or properties.


What is the money laundering document? Applicable regulations

When we want to buy a property we have to make a large financial outlay, so there is a great risk that the buyer uses money that comes from illegal activities. This document tries to identify the buyer to verify the veracity of his identity. In the same way, it tries to show where that person got the money from.

In most cases, whoever wants to acquire real property gets the money through bank financing. In any case, the amount lent by these entities is not 100 % of the price of that good. Therefore, we will have to pay a part as a signal or as input whose origin is usually not very clear. Most people manage to save this money over time, saving part of their payroll every month. It is also common for a friend or relative to lend us that amount.

In Spain you can not carry out economic transactions in cash higher than 2,500 euros. In the case of those persons whose tax residence is settled in another country, this figure rises to 15,000 euros.

According to Law 10/2010, of April 28, on the prevention of money laundering and the financing of terrorism, any cash payment made in the framework of the purchase and sale of real estate must be accompanied by this money laundering document capitals. What data are requested here?

  • Name, surnames, DNI, current residence and other personal and identifying data.
  • Economic regime and data referring to the profession of the person who will make the purchase. For example, if you work as a self-employed person or as an employee.
  • A question appears regarding the applicant about whether he or a relative has held public office in recent years.
  • We must also respond to the purpose for which we acquired the property: if we use it as a habitual residence, to rent, as an investment, etc.
  • The section in which the buyer must specify which source of income will be used to acquire the property is very important. In addition, you will have to specify if the financing is your own or that of others and the bank or country of origin from which the money comes.
  • The document must be signed with the corresponding date and accompanied by a document that gives validity to the data provided, such as a photocopy of the ID card or passport.


What is trying to avoid the money laundering document?

As we mentioned, the main objective of this paper is to ensure the legal origin of our money. What acts try to avoid this document? Mainly it tries that can not be used money gained with the traffic of arms and drugs, the prostitution or white slave trade, among others. This also seeks to prevent the financing of terrorism.

When will it be understood that there has been money laundering?

  • When assets are transferred knowing that they come from a criminal activity.
  • The concealment and concealment of goods being aware that they have been acquired as a result of illegal acts.
  • When we acquire or use goods knowing that they come from activities not permitted by law.
  • Participation in any of the previous activities or the concealment of them.

Although the criminal acts to obtain that money had been committed in another country, if that money is used in Spain it will be understood as an act of money laundering.


Why should you sign this document if you are going to buy a home?

The main reason for doing so is that it is mandatory and in case of not presenting it, justice can take sanctions against you. However, it is rare for you to be the one in charge of all the processing of the acquisition. The usual thing is that these managements are occupied by an agency or a real estate agency, so they will be responsible for requesting this information. In fact, consultants, agents and real estate developers, notaries lawyers and solicitors of these procedures, are required by law to ensure that the buyer’s money does not come from any source of illegal financing. Therefore, they will be the ones who ask us to sign this document.


What penalty does not presenting the money laundering document?

If the buyer does not present this document or if it is considered that the origin of the money comes from illegal activities, the corresponding procedures will be carried out to intervene in these illegal acts and prevent economic transactions with that illegal money.

In the event that the real estate agency does not have a procedure in its internal regulations to detect sources of illegal financing among its clients, the company will have to respond legally.


Other information to keep in mind

When we go to a financial institution to request the financing of our home, the most usual thing is that they ask us to open an account there and that we have to sign the money laundering document.

It is also common that, in some occasions, the bank where we have our savings account, asks us for information such as an updated DNI or a document that justifies where our income comes from, such as a payroll. If we do not present this documentation, they may end up closing our bank account. However, we should not be alarmed if we receive one of these notices. The best thing is that we go in person to our nearest office to speak with an advisor and know where the problem is.


Are there laws against money laundering in other countries?

In most European countries we find internal rules whose purpose is to avoid that you can use money that comes from illegal acts, as well as the financing of them. However, there are tax havens with much less harsh laws.

On the other hand, the European Commission has drawn up a list of countries where there is a high risk of money laundering and terrorist financing: Afghanistan, Bosnia-Herzegovina, Guyana, Iraq, Laos, Syria, Uganda, Vanuatu and Yemen.


Do you need additional information?

If you have questions or queries about this document or about money laundering when buying a home, your real estate agency can help you. In Delux Estates we are experts in buying and selling real estate and we will be happy to help you in everything you need to buy a house in Marbella or surroundings, so do not hesitate to contact us.

On the other hand, you should know that on the website of the SEPBLAC (acronym in Spanish, Commission for the Prevention of Money Laundering and Monetary Infractions) you will find a lot of useful information on money laundering.

Posted on 7/11/2017