Understanding Anti-Money Laundering (AML) and How It Affects Your Real Estate Transaction
At Cranfields Property Bermuda Ltd., we’re committed to delivering an exceptional, transparent service — and that includes keeping our clients informed about the regulatory environment that shapes Bermuda’s real estate industry.
As part of Bermuda’s efforts to maintain the highest international standards, all real estate transactions are now subject to Anti-Money Laundering (AML) and Anti-Terrorism Financing (ATF) regulations. These requirements may seem unfamiliar at first, but they’re in place to protect all parties involved — and to ensure Bermuda remains a safe and trusted jurisdiction in the global property market.
What Does This Mean for You?
Whether you're buying or selling, your real estate agent is now legally required to verify your identity through a process known as Customer Due Diligence (CDD). This process is standard across many countries and industries, including banking and finance, and is now an essential part of Bermuda’s real estate practices.
If You Are Buying or Selling, Here’s What to Expect:
Your agent will ask for the following:
• Proof of identity (typically a passport or government-issued ID)
• Proof of address and nationality
• If you are present in person, the agent will view your documents directly and certify copies.
• If not, you’ll need to supply certified copies from a recognised professional (with their contact details, date, and signature included).
This process is not meant to be intrusive — it’s simply about ensuring that the property transaction is fully compliant and secure.
Why Are These Steps Necessary?
In 2017, Bermuda extended its AML/ATF regulations to include real estate. As of that date, all agents and brokers must carry out proper due diligence on their clients. Real estate professionals are now legally obligated to:
• Identify buyers and sellers
• Identify the source of funds used in a transaction
• Understand and document the true ownership structure if the property is being bought or sold via a trust or company or other legal structure.
All collected information is held securely and confidentially and may only be accessed by the Broker, Agent, or our Compliance Officer. It will only be shared with the Superintendent of Real Estate or related authorities under formal request.
What Additional Information May Be Requested?
In some cases, we may ask for:
• The source of your funds (e.g. salary, inheritance, sale of assets)
• Whether you are a Politically Exposed Person (PEP)
• Identification of trustees or beneficial owners (if a trust is involved)
• Identification of third parties involved in the transaction
These questions help prevent criminal misuse of real estate and protect legitimate buyers and sellers.
Why Real Estate is Part of the AML Framework
Money laundering involves taking illegally obtained funds and disguising them as legitimate income. Real estate is a known global avenue for this practice, and AML legislation helps ensure that such activity is stopped at every level.
Real estate transactions can be involved at any of the three stages of money laundering:
1. Placement – Introducing illicit money into the system
2. Layering – Moving funds through various accounts or investments
3. Integration – Making the funds appear clean, such as using them in a property purchase
By asking the right questions and verifying client information, agents help ensure that all transactions are legitimate and above board.
What Are “Red Flags”?
As part of our compliance process, we’re trained to recognise potential warning signs, which could include:
• A buyer who lives unusually far from the property
• Third parties are heavily involved in the process without a clear reason
• Unusual or unclear funding sources
• Significant cash deposits
These situations may require us to ask more detailed questions or request additional documentation. Please understand this is part of our legal obligation and is not a reflection on you personally.
Our Expertise, Your Peace of Mind
At CPB, our commitment to you includes not only exceptional service and deep market knowledge, but also full legal and regulatory compliance. We have:
• An in-house compliance department
• An internationally accredited real estate trainer
• Decades of experience navigating Bermuda’s evolving regulatory landscape
Our role is to guide you smoothly through the process, making your real estate journey secure, efficient, and stress-free.
Questions?
If you’d like to understand more about how AML legislation may affect your real estate transaction, we invite you to speak directly with your agent, or contact our AML Compliance Officer at +1 (441) 707 1140. We’re here to answer your questions and ensure you feel confident every step of the way.
