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Monday 25 January, 2021

Indicators Related to the Real Estate Sector

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Client Related Indicators 
  1. The client completes the real estate transaction in exchange for a large amount of cash.
  2. The client purchases the property in the name of a partner or relative.
  3. The client is unwilling to place his name on any document that could link him with the ownership, or if he uses different names for the purchase offers, transaction documents, and deposit receipts.
  4. Replacing the buyer's name at the last moment without justification.
  5. The client negotiates a purchase that is equal to market value or greater than the offer price, but without a minimum value on the documents, and the difference is paid outside the framework of the transaction.
  6. The client sells the property for less than market value, while providing an additional payment.
  7. The client pays the initial deposit via check from a third party other than a spouse or a parent.
  8. The client pays the advance payment in cash, and an unknown source or an external bank finances the balance.
  9. The client buys real estate for personal use via the company, without this transaction being compatible with normal commercial activities, or buys real estate without inspecting it, or buys multiple properties within a short period.
  10. The client pays rent allowance or rent in advance using large amounts of cash.
  11. The client's extreme secrecy about the client, the actual owner, the source of the funds, and the reason for the transaction.
  12. Using an agent or mediator without a convincing reason, or strongly rejecting any personal contact with him, or refusing to provide the information, data, and documents usually required when executing the transaction, or providing false or forged documents.
  13. The client was convicted of a property crime, is currently being investigated for a property crime, or has ties to criminals.
  14. The client is associated with a person involved or suspected of being involved in terrorism or activities related to financing terror, or if the client is personally involvement in that.
  15. Unusual familiarity with the standards stipulated in the law that relate to determining acceptable client identity, data entry, and suspicious transaction reports.
  16. Signs documents by fax only.
  17. The buyer of income-generating real-estates does not show any interest in generating profit, whether by filling vacancies or by adjusting rent according to the market value.
  18. Requiring the completion of the real estate purchase process in an expedited and unjustified manner.
Transaction Related Indicators
  1. The transaction involves newly formed juridical persons if the transaction's amount is large in comparison to the assets they own.
  2. The transaction includes juridical entities unrelated to the transaction or the activity carried out by the company.
  3. The transaction includes institutions, cultural or entertainment societies, or non-profit entities in general, and the characteristics of the transaction do not agree with the entity's objectives.
  4. The transaction includes juridical persons with unknown addresses or barely any means of communication, such as: (post office box, shared office or shared business address, etc.), or the data provided is suspected of being wrong.
  5. The existence of various transactions involving the same party, or transactions carried out between a group of juridical persons who may have ties such as family ties between owners or representatives or those with commercial ties all carry the same nationality such as the juridical person or its owners or representatives and share the same address, or the juridical persons or its owners or representatives have the same owner, representative, attorney or entities with similar names.
  6. Creating juridical persons to manage real estate. The sole aim of the creation is to place a pseudo-person as a front between the property and the real owner.
  7. The transaction shows signs or assurances that the parties do not act under their own names, if transactions begin under one name and end under another without a logical explanation for this change, if the transaction parties show no special interest in the property's characteristics such as: building quality or location, or if the parties show no interest in obtaining a better price for it, or where parties show interest in carrying out the transaction expeditiously without cause.
  8. The transactions in which parties show great interest in certain areas without showing interest in the amount to pay, or in which the parties are foreigners or non-residents for tax purposes and their only goal is to invest capital, or in which the parties are foreigners or non-residents for tax purposes and are interested in large-scale operations (such as: buying large areas of land to build homes on), or in which a third party, other than the parties involved, makes any payments. Exceptions may be made in cases where payment is made by a credit institution registered in the country at the time of the signature on the transfer of ownership.
  9. If the transaction's parties or representatives are citizens, residents, or registered in a high-risk country, or are interconnected without a clear commercial reason.
  10. The emergence of the same parties in multiple transactions during a short period of time, or attempting to hide the real owner or parties in the transaction.
  11. The person actually managing the process is not an official party of the transaction or their representative.
  12. A natural person acting as a manager or a representative but does not appear to be a suitable one.
  13. The transactions that take the form of a special contract and in which there is no intention to register the contract, or in which the intention was expressed but was not completed in the end, or in which it takes place without a clause in the contract that causes the buyer to lose the deposit in case the sale was not made.
  14. The transactions that are related to the property itself or to the rights it entails at a rapid pace (such as: the purchase and immediate sale of the property), which include a significant increase or decrease in the price compared to the purchase price.
  15. The transactions that are entered into for a completely different value (much higher or lower) than the actual property value, or in which it differs significantly from the market values.
  16. The transactions that take place through intermediaries working on behalf of groups of people with potential ties (such as: family or business ties, or same nationalities).
  17. The transactions that take place through intermediaries working on behalf of groups of juridical persons with potential ties (such as: family ties between owners or representatives or commercial ties).
  18. Transactions involving cash payments or negotiable instruments that do not declare the actual payment party (such as bank transfers), and in which the accumulated amount is considered to be large when compared to the total amount of the transaction, or in which the party requests that the payment be divided into smaller installments with a short period of time between them.
  19. Transactions with suspicions regarding the authenticity of the submitted documents with the loan application, or that are made in exchange for a loan by using a cash guarantee, or if this guarantee is deposited abroad.
  20. The transactions in which payments are made in cash or via bank bonds, bearer checks, or other unknown instruments, and if checks are endorsed to a third party when payments are made.
  21. The transactions involving funds from countries that are considered tax exempt or risky regions based on the law.
  22. The transactions in which the buyer incurs a very large debt compared to the property's value.
Geographical Location Related Indicators
  1. The transactions involve juridical persons or legal arrangements registered in tax-exempt or risky areas.
  2. The clients show great interest in purchasing properties in certain areas without concern about the price.
  3. The real estate contributes to the capital of a company that does not have a registered address or a permanent headquarters open to the public in the country.