During the course of the conveyancing process, it is a legal requirement that the buyer provides adequate proof of the source of their funds to their Solicitor.
It is necessary to put strict procedures in place as millions of pounds pass between conveyancingon a daily basis which make the sector a huge target for criminals and fraudsters.
When looking to prove the source of your funds it may feel like you are guilty until proven innocent. Sadly this is the case and it is your responsibility to prove this money didn’t come from the proceeds of crime.
You may feel aggrieved that after all of the years spent saving that this is unfair and question why should you have to provide all this information. The answer to this is that with so much fraud within conveyancing it is essential solicitors become even more vigilant.
It is important to note that under the Proceeds of Crime Act 2002 (POCA), if the solicitor suspects that you have criminal property, they are required to make a report that they suspect you are engaging in money laundering. If they do not, they are themselves liable for prosecution for failure to report under the POCA.
Until we have satisfied ourselves of the source of funds, we cannot proceed with the purchase on your behalf.
Categories for Proof of Funds
The best evidence of savings will be bank statements for the last 6 months showing an accumulation of funds in your bank account.
If you have more than one bank account containing savings, you will need to provide statements for the last 6 months for those accounts.
A copy of your pension release document and a copy of your bank statement showing the money being received from the pension company.
3. Sale of Shares
A copy of the share release schedule and a copy of your bank statement showing the money being received from the shares.
4. Sale of another property
A copy of the completion statement from your solicitor and a copy of your bank statement showing the money being received from the solicitor following the sale. If Harold Stock & Co acted on your behalf in relation to the sale, it will not be necessary to provide this proof.
A copy of the letter from the executors stating how much you are being paid as a beneficiary and a copy of your bank statement showing the money being received from the solicitor/executor’s bank account.
6. Dividends from a UK Company
A copy of your dividend certificate, a copy of the company’s accounts and a copy of your bank statement showing the money being received from the Company.
7. Gambling Winnings
A copy of your receipt proving your winnings and a copy of your bank statement showing the money being received.
8. Compensation Award/Court Settlement
A copy of your letter confirming your compensation settlement from a Solicitor and/or Court and a copy of your bank statement showing the money being received from a third party/Court/Solicitor.
We will require a letter from the person making the gift. The person making the gift will also have to prove the source of the funds in the same manner as you would have to. If you indicate within your questionnaire that you are to receive a gifted deposit, we will send further information to you in this regard.
If your money has been generated through other means, please contact us immediately to discuss this further and so that we can advise on a suitable means of proving the source of your funds.
We can only accept cash payments up to the value of £500. It is almost impossible to prove the source of your funds for lump sums of cash. Even lump sums of cash paid into a bank account may prove difficult when it comes to proving the source of funds.
If you have any questions or concerns in relation to source of funds, please do not hesitate to contact us.