A booming economy and absence of AML/CTF regulations has made the Australian real estate industry an attractive destination for money laundering criminals.
AUSTRAC, Australia’s financial crimes regulator have stated that criminals may be drawn to the real estate industry as a channel to illicit funds due to the ability to pay for real estate in cash, the ability to disguise the beneficial ownership of property, the stability and reliability of real estate investment and the ability to increase the value of property by means of renovations. In comparison to other money laundering methods, real estate in Australia can be uncomplicated and large sums of money can be easily concealed.
According to AUSTRAC, in the 2015/16 financial year, an estimated $1 billion in suspicious transactions were made by Chinese investors in the Australian property market. Other dwellings in various cities across the country have also seen a rise in the value of property by international investors, which acts as a red flag for money laundering, as criminals are generally willing to pay above market value in order to secure a safe and legitimate investment.
Similar to Real Estate, a lack of regulations surrounding high-value goods (jewellery, precious stones, antiques, fine art, yachts, luxury motor vehicles and building/bathroom/kitchen supplies) are often used by criminals for laundering money, as large sums of money can be easily disguised and enjoyed anonymously.
In 2010, the Commonwealth Government recovered criminal assets including cash, houses, boats and motor vehicles amongst other items worth over $13 million.
