Real Estate Institute calls for clarity on money laundering prevention role

The Real Estate Institute of Australia (REIA) has responded to a new research report on money laundering and organised crime, calling for more practical guidance on how real estate agents can counter these activities.

REIA President Leanne Pilkington said the report, released by the Australian Institute of Criminology (AIC) and the Australian Transaction Reports and Analysis Centre (AUSTRAC), quantifies the link between organised crime and money laundering but offers little practical policy advice for real estate agents.

Key points from the report include:

Reducing money laundering would limit criminals’ ability to reinvest in future criminal enterprises
The financial sector is three times more likely to be targeted for money laundering than real estate
Professional facilitators play a significant role in laundering proceeds of crime

Ms Pilkington emphasized that real estate agencies, primarily small businesses, lack the expertise and resources to identify money laundering activities.

“Real estate agencies are primarily small businesses and do not have the expertise nor resources to be able to identify such activity,” she said.

The REIA highlighted concerns about the potential costs of implementing stricter money laundering regulations, citing the experience in New Zealand where small agencies faced costs of up to $30,000 and large agencies up to $60,000.

With new legislation expected this week, Ms Pilkington called for a detailed cost-benefit analysis of the proposed second tranche of money laundering regulations.

“REIA has long been calling for a detailed quantification of the costs and benefits of the proposed second tranche of money laundering and with legislation expected this week it is high time we had this and an indication of what assistance will be available in addressing a community benefit,” she said.

The REIA represents 85% of Australian real estate agencies, comprising 46,793 businesses that employ 133,360 Australians.