Real estate agents and lawyers vulnerable to money laundering risk
AUSTRAC has released two new reports to help Australian businesses identify money laundering methodologies used through real estate agents and lawyers.
AUSTRAC is Australia’s primary source of financial intelligence, providing expertise and global leadership on financial intelligence matters.
AUSTRAC’s strategic analysis briefs Money laundering through real estate and Money laundering through legal practitioners provide information about money laundering methods, business vulnerabilities and indicators that a person is laundering the proceeds of crime.
Laundering of illicit funds through real estate is an established money laundering method in Australia.
Criminals are drawn to real estate investment in Australia because it is possible to purchase in cash, it offers reliable financial returns and it is possible to disguise ownership.
Methods of laundering money include mixing illicit funds with loan funds, manipulating the value of properties, use of third parties to present as the official owner, purchasing properties to facilitate criminal activity, generating rental income to seem legitimate and using front companies and trusts to hide the identity of ownership.
Criminals also use professional facilitators such as lawyers to help them seem legitimate.
Money laundering methods include using lawyers and other professional services to conduct transactions of their behalf, establishing trusts and other structures to hide identity, recovering fictitious debts, making payments through lawyer’s trust accounts.
- using cash to settle transactions which are not usually cash-based, such as real estate purchase
- multiple and unexplained funds transfers, especially from overseas
- difficulty identifying the ultimate source of deposits
- moving funds to/from the law firm’s trust account to/from bank secrecy jurisdictions or high-risk jurisdictions.
Sharing knowledge of money laundering methods and associated indicators may help businesses to detect and mitigate attempts to launder the proceeds of crime.
Suspicious activities are reported to AUSTRAC through Suspicious Matter Reports (SMRs). A range of Australian businesses including banks, casinos, remitters and foreign exchange providers have submitted SMRs which have helped detect, disrupt and deter crime.
Businesses concerned that a person might be undertaking a suspicious transaction can lodge an SMR with AUSTRAC or call the AUSTRAC Contact Centre on 1300 021 037.
Attribution: AUSTRAC CEO Mr Paul Jevtovic APM
Available for interview: AUSTRAC CEO Paul Jevtovic.
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AUSTRAC’s strategic analysis briefs are available online: