Many of you reading this article will likely recognize this due to how annoying your lawyers, agencies,
banks, property developers, notaries, etc., can be when they ask you (sometimes two or three times) for all
your figures (pay slips, profit and loss statements, copies of documents related to inheritance or sales in your home country…), but there is no other alternative but to go through the uncomfortable situation of having to disclose and show everything, to protect your money and the individuals involved in property transactions, one must go through it. When purchasing a property, the buyer must be able to prove the origin of the funds to avoid money laundering. For this purpose, it has been mandatory since 2010, when Law 10/2010 on the prevention of money laundering was adopted, to sign anti-money laundering documentation when buying a property. Lawyers, property developers, real estate agents, notaries, and registrars are among those obligated to verify the origin of the funds to prevent money laundering. As for lawyers, they must, among other things:
- Inform SEPBLAC (the anti-money laundering authority) of any circumstance where the origin of the
funds for the purchase does not match your income declarations or proof of the origin of funds. - Have an obligation to keep documents for 10 years, corresponding to the statute of limitations for
money laundering offenses. During this time, authorities may request that the lawyer disclose
everything to conduct an investigation. If the origin of the money cannot be demonstrated (supported
by documents), the lawyer does not inform the Spanish tax authorities; it is the notary or registrar
who must do so. Therefore, for the client’s sake, it is better to have everything clear from the very
first stage, i.e., in the initial relationship with the lawyer, as later it may be too late… The risk of not
doing this is the loss of the money already sent to Spain or its freezing, as well as triggering an
investigation for both the client and the lawyer. The same situation arises when purchasing through a
company; you must be able to prove the origin and financial capacity of the individuals behind these
companies.