RES exam question on AML / CFT: Lumen Realty signed a two-year engagement with investor Ms Quek in 2025 to buy and sell…
Lumen Realty signed a two-year engagement with investor Ms Quek in 2025 to buy and sell several private units for her. Her identity was verified when the engagement began, and she has since completed two purchases through the agency. Which of the following statements is/are correct? (i) The due diligence information on her is refreshed at her request, and not otherwise. (ii) Once she was verified in 2025, no further review of her is needed for the two years. (iii) The same ongoing monitoring is owed to an unrepresented buyer on the other side of her sales. (iv) Ongoing monitoring means reviewing her transactions for consistency with what the agency knows of her.
- A(i) and (iv) only
- B(iv) only
- C(iii) and (iv) only
- D(i) and (ii) only
Show answer & explanation
Answer
B. (iv) only
Explanation
Answer: (iv) only. Ongoing monitoring is a continuing client duty, and it does not extend to an unrepresented counterparty.(iv) True. The agency reviews her transactions for consistency with what it knows of her, her business and her risk profile.Rule: Where a business relationship continues, the estate agent monitors it on an ongoing basis and keeps the client's due diligence information up to date, more closely where risk is higher. Ongoing monitoring is a client duty.Source: Estate Agents (Prevention of Money Laundering, Proliferation Financing and Terrorism Financing) Regulations 2021, as amended with effect from 1 July 2025
Why the other options are wrong
- (i) False. The agency updates her information as needed, not only when she asks.
- (ii) False. Verification at onboarding starts the monitoring rather than ending it.
- (iii) False. The counterparty is checked, not monitored.
Study the concept behind this question: AML/CFT for Property Agents: CDD, Source of Funds & STR
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