New laws aim to make it harder to launder ill-gotten gains through property

Renee Roumanos says the changes will make conveyancing more difficult. (ABC News: John Gunn) From July 1, new anti-money laundering laws mean real estate agents, conveyancers, lawyers and others must verify their customers in a similar way that banks and casinos do. AUSTRAC estimates in 2020 alone, criminals linked to China laundered $1 billion through Australian real estate. Professionals in the industries must register with AUSTRAC and complete training. Link copiedShareShare articleCriminal gangs using dirty cash to buy homes will find it harder from July 1 because the real estate industry and others have been drafted into the fight against money laundering. So-called Tranche 2 laws mean real estate agents, conveyancers, lawyers, accountants, gem dealers and precious metal brokers must verify their customers in a similar way that banks and casinos do, bringing Australia in line with the rest of the world. They'll need to know who the customers are and where the money is coming from. "We're looking forward to the laws making it much harder for organised crime gangs and criminals to exploit our economy, to launder money and also fund terrorism," said Clancy Moore of Transparency International Australia, which has been pushing for the laws for more than a decade. Clancy Moore says lawyers and agents will have to report "when they think something's a bit fishy" in a transaction. (Four Corners: Craig Hansen) While the start of the laws is not expected to substantially lower the overall price of property in Australia, it will have an impact. Money laundering describes the "washing" of cash so that money made by criminal means ends up looking like legitimate profits. Laws against it often use the acronym AML/CTF, which stands for Anti-Money Laundering and Counter-Terrorism Financing. Money laundering describes the "washing" of cash. (Supplied: Queensland Police Service) In a 2015 brief, financial crimes regulator AUSTRAC described its attempts to control criminal misuse in unflattering terms. "Compared to other methods, money laundering through real estate — both residential and commercial — can be relatively uncomplicated, requiring little planning or expertise. Large sums of illicit funds can be concealed and integrated into the legitimate economy through real estate." AUSTRAC estimates that, in 2020 alone, criminals linked to China laundered $1 billion through Australian real estate. Australia's largest property franchise, Ray White Group, has more than 12,000 agents. Shaun Doyle is the agency compliance manager and has visited every state and territory twice in the past year, trying to bring agents up to speed. "This is one of the most substantial changes to the industry, just because the complexity and the seriousness of it," Mr Doyle said. "But when an agent understands their requirements, it's pretty straightforward. Shaun Doyle has visited all 12,000 agents in the group to prepare them for the new laws. (ABC News: Wayne Hammond) Most buyers and sellers will have been in contact with banks, who already require verification of identity. This is generally done by the 100 points system, where customers can present a combination of documents, for example, a valid passport or birth certificate is worth 70 points, licences and bills slightly less, to prove they are who they say they are. Ray White Mt Gravatt operations manager Michelle Romero will be verifying buyers and sellers for a team of sales staff who complete about 200 residential sales a year. Michelle Romero says the changes will be an additional layer of service. (ABC News: Craig Andrews) "I've been in the industry 35 years," Mrs Romero says, "and we take each transaction as it comes. So it is a change, but it's just an additional layer to the service that we offer now." Real estate industry groups fought the imposition of the laws for years. One of the issues for the broader industry is that larger groups have the resources to prepare for the new laws. Smaller agencies may only just be realising the deadline is here. The extra work is for good reason, she adds. "We're just one industry in a group of many who are now part of making sure property transactions are more transparent and that our industry isn't used to fund criminal and illegal activity," she said. Western Sydney lawyer Renee Roumanos completes transactions and teaches conveyancing, the legal process of transferring the ownership of a property asset. "Honestly, our industry is not ready," she said. "All of a sudden, we have become gatekeepers to AML". Renee Roumanos says the July 1 deadline will be a shock. (ABC News: John Gunn) She predicts "awkward conversations" as agents start to enquire about where buyers have got the money from, and wants the public to understand that it's not about being nosy. What it means in practice is that if a buyer has come into their money in a way beyond obvious wages, such as a gift or a bonus, it will now need to be docu

New laws aim to make it harder to launder ill-gotten gains through property

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