Gangsters paradise: How do you stop money launderers buying up Australian real estate?

Innovation

Financial crime experts say that money launderers will continue to buy up Australian real estate until legal loopholes are addressed. However, opinion is divided as to how to solve the problem.

Key Takeaways

On 2 February 2023, police in Sydney expose one of the biggest money laundering syndicates in Australian history. They seized 20 properties and other assets valued at $150 million.
An estimated $95 billion passes through Australia’s ‘gambling capital’ of New South Wales pokies machines every year, with few premises complying with money laundering regulations.
$10 billion is funnelled through Australian real estate every year, according to estimates by Transparency International.
The amount of money laundered every year is somewhere between 2% and 5% of global GDP per year, according to the United Nations.
In 2006, then prime minister John Howard committed to closing the loophole that excludes accountants, lawyers and real estate agents from needing to report suspicious transactions. Despite calls for reform, the loophole still exists in 2023.
In March 2022, a Senate committee handed down a report that was critical of the effectiveness of Australia’s anti-money laundering and counter-terrorism (AML/CTF) regime.

When a police operation exposed one of the biggest money laundering syndicates in Australian history in February, it prompted renewed questions about the adequacy of the nation’s legal framework to prevent money laundering in real estate.

Australian Federal Police (AFP) seized 20 Sydney properties across 13 suburbs, commercial buildings in the CBD and a 360-hectare plot of land worth $47 million close to Western Sydney Airport. Also seized was $29 million in cryptocurrency, along with luxury cars, designer watches and handbags.