Money laundering is a global threat that undermines financial integrity, fuels crime, and exposes organisations to severe regulatory, financial, and reputational risks. Nowhere is this more critical than in the finance and real estate sectors, two industries that routinely handle large transactions, cross-border flows, and complex ownership structures. For employers in these sectors, robust screening programmes are an essential line of defence. At iFacts, we believe effective screening must be continuous, risk-based, and legally compliant, starting before hire and continuing throughout employment.
Both industries are attractive to money launderers because they facilitate rapid movement and concealment of value. Real estate transactions can be used to launder proceeds via purchases, sales, or rental income; financial services provide accounts and instruments that can mask the origins of funds. Employers must therefore screen not just for technical competence, but for integrity and exposure to financial crime risks.
In South Africa, financial and advisory roles are subject to sector-specific scrutiny. Two important checks in the financial services sector are FAIS and DOFA:
- FAIS (Financial Advisory and Intermediary Services) checks confirm that an individual is registered, authorised and compliant under the FAIS Act. This verifies licensing, qualifications, fit and proper status and any disciplinary history with regulatory bodies.
- DOFA (Date of First Appointment) is used to determine an advisor’s regulatory experience and seniority for supervisory and qualification purposes. DOFA is essential where regulatory exemptions, continued professional development or supervisory responsibilities are concerned.
For employers, ensuring FAIS registration and confirming DOFA helps prevent unlicensed advisory practices and ensures that those entrusted with clients’ funds meet legal standards.
Core screening elements to prevent money laundering
- Identity verification and right to work
Confirm identity using authoritative documents and databases. Verifying identity is the first step to preventing fraud and false identities, a common tactic in money laundering schemes. - Qualification and employment verification
Check all claimed qualifications and prior employment. Faked credentials can be a red flag for fraudulent intent or poor judgement. - Criminal record checks and sanctions screening
Conduct criminal and sanctions checks locally and internationally to identify convictions, regulatory sanctions, or ties to organised crime. Screening should include politically exposed persons (PEP) lists and global sanctions databases. - FAIS & DOFA checks (where relevant)
Ensures regulatory compliance for advisers and financial intermediaries. Failure to verify regulatory status can expose firms to enforcement and reputational risk. - Integrity and behavioural assessments
Psychometric integrity tests and situational judgment tests help evaluate honesty, rule-following, risk tolerance, and ethical decision-making. These tests predict the likelihood of counterproductive or fraudulent behaviour and should be used as part of a multimodal assessment. - Social media screening provides context on behaviour, associations and lifestyle. In finance and real estate, evidence of lavish spending inconsistent with declared income, public posts endorsing risky or illegal practices, or affiliations with suspect entities can be early warning signs. Ensure you use a compliant screening company to conduct such checks, and handle findings sensitively and in compliance with POPIA.
- Financial (credit) checks
For roles with financial control or fiduciary responsibility, credit checks can reveal financial stress that may increase susceptibility to corrupt offers or theft. - Beneficial ownership and conflict of interest checks
In real estate, understanding who ultimately controls funds or entities is crucial. Screening should examine beneficial ownership, shell company links, and potential conflicts of interest that could enable money laundering.
For senior managers, procurement staff, trust officers, wealth managers, and real estate brokers, especially in jurisdictions with high exposure to illicit funds, lifestyle audits may be necessary. These audits compare declared income to observable assets and spending patterns. Discrepancies do not prove wrongdoing but indicate areas where deeper investigation is prudent. Crucially, lifestyle audits must be handled ethically, with legal advice, transparency and due process to protect privacy rights under POPIA and labour law.
Screening is not a one-off event. Pre-employment checks determine initial suitability, but ongoing monitoring is critical for detecting changes in the risk profile. Continuous screening might include periodic criminal checks, updated sanctions screening, transaction monitoring (where authorised), and repeat integrity assessments for key roles. Any ongoing programme must be lawful, proportionate and documented, with clear consent and data protection measures.
Employers must balance risk management with respect for individual rights.
Best practice includes:
- Clear policies communicated to candidates and staff about what is checked and why.
- Obtaining informed consent and ensuring data security and limited retention.
- Providing a fair opportunity for employees to explain adverse findings before final decisions.
- Using validated assessments and accredited providers, and ensuring decisions are evidence-based and job-relevant.
An effective anti-money laundering screening programme integrates HR screening, compliance, legal, and security functions. iFacts supports this by providing tailored FAIS/DOFA checks, psychometric integrity assessments, social media risk profiling, and continuous monitoring solutions, all designed to meet South African legal and regulatory requirements.
In finance and real estate, where the stakes are high and the vectors for abuse are many, organisations must be proactive. Robust, culturally nuanced and legally compliant screening, beginning at hire and continuing throughout employment, helps protect firms from fraud and money laundering and supports a culture of integrity. By blending regulatory checks with psychometric insight and ongoing monitoring, employers can strike the balance between enabling opportunity and guarding against risk.
If your organisation needs to strengthen its screening in line with AML, FAIS, DOFA and POPIA requirements, iFacts provides comprehensive, compliant solutions to help you hire with confidence.
Contact us to find out how we can tailor a screening programme for your needs.
