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Australia property sector needs money laundering safeguards: report
[SYDNEY] Australia needs to tighten safeguards against money laundering in its booming property market, which has attracted Chinese funds with likely links to corruption, an international anti-money laundering body said in a report released late on Tuesday.
The intergovernmental Financial Action Task Force said real estate agents and lawyers have been identified as a high money laundering risk in Australia, where regulations do not require them to report suspicious transactions.
The Paris-based group recommended that Australia widen its efforts, instead of only focusing on drugs, fraud and tax evasion. "Australia is seen as an attractive destination for foreign proceeds, particularly corruption-related proceeds flowing into real estate, from the Asia-Pacific region," FATF said in its year-long review of Australia.
Lawyers, accountants, real estate agents and precious stones dealers should demonstrate that they are refusing business on money laundering and terrorism financing grounds and they should be required to report suspicious transactions, the task force recommended.
The report comes a month after Australia ordered the Chinese owner of a A$39 million (S$40 million) Sydney mansion to sell it within 90 days, saying it was purchased illegally although it did not suggest it was linked to corrupt funds.
Immediately following the high-profile incident, Treasurer Joe Hockey said Australia would beef up its investigations into foreigners buying residential properties.
Australia, the United States and Canada are the three most popular destinations for suspected economic criminals from China, Chinese state media have said. Last year, China launched "Operation Fox Hunt" to go after suspects who have left the country to seek refuge abroad, often taking large sums with them.
Chinese are the number-one foreign buyers of Australian real estate, snapping up nearly A$6 billion worth in 2013, according to the Foreign Investment Review Board.