Financial monitoring when buying an apartment

Buying an apartment is a rather responsible event for which you need to prepare both morally, financially and documentarily. Today we will analyze what conditions must be met and what documents must be prepared in order to conclude such a transaction without any obstacles and additional difficulties.

The provisions of the Civil Code of Ukraine stipulate that real estate transactions, including the purchase and sale of an apartment, are conducted with the mandatory participation of a notary and subsequent state registration of such property with the new owner.

Legislation defines an exhaustive list of persons conducting initial financial monitoring, which, along with banks, includes notaries.

Thus, notaries in many countries are subjects of primary financial monitoring.

Primary financial monitoring in notarial activities is a process aimed at identifying financial transactions that may be related to criminal activities, such as money laundering, terrorist financing and other crimes, during notarial activities.

Notaries play a key role in this process through their involvement in the signing and legalization of various legal documents, such as contracts, agreements, wills, etc. Since these documents are often used to conduct financial transactions, notaries can be an important source of information about financial transactions that require further analysis as part of financial monitoring.

Under the law, notaries may be required to verify and store information about their clients and their financial transactions, and to provide this information to the authorities in the performance of their monitoring and crime-fighting duties.

In practice, when notarizing apartment purchase and sale agreements, notaries must verify the legitimacy of the origin of the payer/buyer's funds before performing the notarial act.

Thus, the buyer of an apartment must present to the notary documents confirming the origin of the funds for the entire amount to be paid under this transaction.

At this stage, it should be noted that any information provided by you to the notary during the notarial act is protected by notarial secrecy and imposes an obligation on the notary not to disclose information received by him/her during the notarial act. This ensures the safety of any commercial or confidential information. At the same time, to ensure financial monitoring, an exception has been made, and notarial secrecy does not apply to information on the receipt of income related to criminal activities, such as money laundering, terrorist financing or other crimes.

If you still have any questions, Prikhodko & Partners Law Firm is ready to offer you a full consultation in which we will analyze your situation, provide a legal assessment and formulate a legal position on this issue. Fill out the form on our website and our lawyer will contact you as soon as possible.