Nevado Spring Summer 24

PAG 14 A 82 ADS 59.qxp_Maquetación 1 19/3/24 13:31 Página 76
“KNOW YOUR CLIENT (KYC)”
MANDATORY LEGAL PROCEDURE TO
PREVENT ANY ILLEGAL TRANSACTION
by Christine Sollie Jensen & José Luis Rojas Vazquez
All professionals involved in the purchase and sale of
real estate properties must comply with their
obligations with regard to the prevention of money
laundering. Real estate agents, Lawyers, Property
Developers and Credit and Financing Institutions must
abide by the obligations imposed under Law 10/2010,
of 28 April, on the Prevention of Money Laundering and
the Financing of Terrorism, and to its relevant
Regulations.
The obligations imposed on those professionals by the
Law are based on the “due diligence” principle, in the
sense that, as individuals obliged by law, they are
responsible for adopting relevant measures in order to
detect and report any signs of money laundering crimes
committed by their clients.
The purpose of the above is to prevent and report any
transactions associated with any possible money
laundering to the Executive Committee of the Spanish
Commission for the Prevention of Money Laundering
(Servicio Ejecutivo de la Comisión de prevención del
Blanqueo de Capitales (SEPBLAC)).
Lawyers, in particular, are obliged to: formally identify
their clients and the actual owners of the respective
business and/or transaction; know the business carried
out by their clients and verify the authenticity of the
related documents provided by them; and especially, in
real estate transactions, to check the legitimate source
of the funds used.
Identification of Clients.
The Lawyer must request the relevant Tax ID Card, ID
Card or Passport issued by the authorities of their
country. Legal entities must be identified by their Deed
of Incorporation.
Actual owner of the business
Lawyers must identify the individual on whose behalf
they are acting, before accepting any professional
engagement.
Business purpose.
Specific knowledge of the professional or business
activity of our client is required.
Legality of the funds used.
The required documents must be gathered to support
the lawful source of the funds, their traceability, i.e. the
path followed by the money from the time it leaves its
country of origin to the time it arrives in Spain, and
finally, the purpose of the funds.
One of the most commonly used methods for the
prevention of money laundering and terrorism financing
is the “Know Your Client (KYC)” process.
Completing and signing the KYC forms produced by
the individuals participating in a real estate
transaction is not sufficient. All information supplied
by clients must be carefully checked from the lawyer
and by duly assessing the relevant supporting
documents provided.
At the same time, we should not lose sight of the
ongoing conflict between the limits of a Lawyer’s duty
of confidentiality. Professional secrecy cannot be
claimed in certain circumstances related to money
laundering and terrorism financing, and Lawyers must
always comply with their obligations regarding the
prevention of money laundering, which must be
construed in the strictest sense, without including any
that go beyond those included in Act 10/2010.
In this context, the role of your Lawyer is absolutely
essential. The Lawyer will ensure the strictest KYC
process as required by law, will advise the Client
regarding the documents to be provided in order to
follow the anti-money laundering protocol, and at the
same time, he will be the intermediary between the
client and the other agents involved in the transaction
to ensure they comply with their respective obligations
on prevention.