Source of funds and source of wealth
We are legally required to ensure that any funds received from a client or on a behalf of a client are from credible sources. To assist you, we have put together some examples of documents that we may accept in order to confirm your source of funds and source of wealth.
Establishing the source of funds is different from source of wealth.
The key thing to remember is that we are looking to establish the original SOURCE of funds being used and not the mere availability of funds in a bank account.
“Source of funds” refers to the funds that are being used to fund the specific transaction in hand – i.e., the origin of the funds used for the transactions or activities that occur within the business relationship or occasional transaction. The question you are seeking to answer should not simply be, “where did the money for the transaction come from,” but also “how and from where did the client get the money for this transaction or business relationship.” It is not enough to know the money came from a UK bank account.
“Source of wealth” relates to the economic, business and/or commercial activities that generated, or significantly contributed to, the client’s overall net worth/entire body of wealth to how the client came to accumulate/ generate the funds in question – via inheritance, house sale, or investment windfall for example.
In order to complete our due diligence requirements, you will be asked to provide evidence of your source of funds and/or source of wealth. Please have this information and documentary evidence of the same to hand as any delay in providing such documentation may result in Kirbys Solicitors Limited being unable to complete the required transaction or the withdrawal of all our legal services.
The following are NOT acceptable to prove source of funds:
Screenshots/photos of bank account statements from a mobile or similar device. – You must
provide us with full PDF statements which have been downloaded from your account and they must include your name and address.
Statements from savings accounts which only show internal transfers being made. This is not acceptable as it does not determine where the original source of funds have come from.
Depending on the circ*mstances of your transaction, we may ask for one or more of the below:
Earnings / Salary:
- Original written confirmation of annual salary (and/or any bonuses) detailing position held, time of employment, signed (“wet signature”) by your employer/HR Manager accompanied by your last 6 months of bank statements which show your salary/earnings being paid to you so that we can see the build-up of your funds, as well as your corresponding payslips.
- If no longer working (retired), please let us know a history of your past employment with any accompanied evidence if possible.
Self-employment:
- please provide bank statements showing the funds accumulating as well as a copy of your most recent tax return
Savings
- Statement from the savings institution.
Property Sale
- Original or certified copy completion statement from the solicitor who acted for you on the sale/re-mortgage, along with a bank statement which shows the sale/re-mortgage proceeds being paid into your account.
Sale of Shares / Investments
- please provide some form of valuation/portfolio, together with a bank statement which shows the funds being sent to you
Inheritance
- please provide a copy of the estate accounts as well as a bank statement showing the monies being distributed to you.
Company Sale/Dividend
- Original or certified copy of contract of sale; or
- Original confirmation of sale signed (“wet signature”) by advocate/solicitor/accountant; and/or
- Original or certified copies of any relevant minutes.
- And a bank statement showing the funds being paid to you,
Divorce Settlement
- Original or certified copy of court order; or
- Original confirmation of settlement signed (“wet signature”) by advocate/solicitor.
Lifetime/ Help to Buy ISA Accounts
- whether you are claiming any additional bonus or not, please provide an account statement
Rental earnings
- please provide bank statements showing the rental income each month; as well as a copy of the relevant tenancy agreement.
Lottery/Gambling win
- Confirmation from the lottery company; and
- Winnings’ receipt; with
- Corresponding evidence of payment into your bank account.
Gifted Deposits
- Documentary evidence of the source of funds and source of wealth of the giftor making the gift will be required.
- Third parties gifting funds towards a transaction will also be asked to provide their due diligence, for more information please refer to the guidance on Client Identification – Individual:https://kirbys.co.uk/client-identification-individual/.
- The giftor will have to provide Proof of Funds in accordance with the above requirements
- The giftor will need to provide a Gifted Deposit Letter confirming that the funds are not repayable at any time and are a gift.
Please note that we are required to obtain satisfactory proof of funds in every purchase, no matter the amount nor how long ago the relevant source occurred. This must be provided before your file can proceed to exchange of contracts. Should you have any questions, or if the relevant source is not included here, please discuss this with your file handler
