RegAlert

Guidance · FMU · 23 Jul 2020 · Circular No.7

Red Flags Indicators for Real Estate Sector

aml

Under Section 7(1) of the Anti-Money Laundering Act, 2010, real estate sector entities are mandated to file Suspicious Transaction Reports (STRs) with the Financial Monitoring Unit. The FMU has provided specific red flag indicators to assist agents, brokers, and developers in identifying potential money laundering or terrorism financing. While individual red flags may not confirm illegal activity, entities must evaluate combinations of these indicators alongside comprehensive client profiles and financial analysis to assess risks effectively.

PakistanFinancial Monitoring Unit

FINANCIAL MONITORING UNIT (FMU)
GOVERNMENT OF PAKISTAN
2ND FLOOR, SBP MAIN BUILDING, I.I. CHUNDRIGAR ROAD, KARACHI 4400

FMU-Circular No. 07 of 2020
July 23, 2020

DNFBPs (Real Estate Sector)

Dear Sirs/Madams,

Red Flags Indicators for Real Estate Sector

In terms of Section 7 (1) of Anti-Money Laundering Act, 2010, the reporting entities are required to promptly report Suspicious Transactions Reports (STRs) to Financial Monitoring Unit for potential Money Laundering (ML) / Terrorism Financing (TF) related activities.

The reporting entities also includes Designated non-Financial Business Professions (Real Estate Sector) as per Section 2 (u) read with Section 2 (m) of AML Act 2010.

  1. In order to identify a suspicion that could be indicative of Money Laundering (ML) or Terrorism Financing (TF), FMU has prepared the red flags indicators that are specially intended as an aid for Real Estate Agents, property dealers / brokers, housing authorities, and builders and developers, which are attached as “Red Flags Indicators for Real Estate Sector”.

  2. These red flags may appear suspicious on their own; however, it may be considered that a single red flag would not be a clear indicator of potential ML / TF activity.

However, a combination of these red flags, in addition to analysis of overall financial activity and client profile may indicate a potential ML / TF activity.

Encl: Red Flags Indicators for Real Estate Sector.

Yours truly,

Sd/-
(Sumera Baloch)
Additional Director

Distributed to:
The Chairman, Federal Board of Revenue (FBR)

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Anti-Money Laundering Act, 2010Not in RegAlertAnti-Money Laundering Act, 2010 — Not in RegAlertRed Flags Indicators for RealEstate Sector2020-07-23 · this documentRed Flags Indicators for Real Estate Sector (2020-07-23)
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  • Anti-Money Laundering Act, 2010Not in RegAlert

    “In terms of Section 7 (1) of Anti-Money Laundering Act, 2010, the reporting entities are required to promptly report Suspicious Transactions Reports (STRs) to Financial Monitoring Unit for potential Money Laundering (ML) / Terrorism Financ…”

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