(Australian Associated Press)
Criminals pumping nefarious earnings into the housing market could be contributing to high house prices across the country, locking people out of owning a home.
The head of Transparency International Australia, Serena Lillywhite, says money laundering creates “devastating impacts” for the country.
“Australia has become the destination of choice for illicit financial flows … which too often end up in the property market,” she told a Senate inquiry on Tuesday.
“It can reasonably be argued that it is driving up property prices in Australia and locking Australians out of owning their own home.”
Sudanese generals, Malaysian bankers, Papua New Guinea elites and Chinese high rollers were all signalled as people using the Australian property market to wash funds.
Criminals are able to use family members or other third parties with no criminal record to buy property in Australia in their name.
Australia’s financial watchdog AUSTRAC flagged in one of its analyses $1 billion of suspicious property transactions from Chinese investors, the inquiry heard.
Ms Lillywhite questioned what it would take for Australia to close loopholes being exploited by criminals to launder their money after Crown Casino was able to keep its licence despite adverse findings from a royal commission.
“How much evidence of money laundering in Australia will it take before the law is changed and enforcement ramped up?” she said.
Ms Lillywhite called for the strengthening of the financial watchdog and broadening its scope as well as the closure of legal loopholes that allow criminals to conduct business in Australia.
The hearing was told Australia’s financial markets were attractive to criminals because of the ease at which they could hide funds through the creation of trusts and shell companies.
Labor senator Deborah O’Neill said the evidence shocking, quipping that rock band AC/DC had it right.
“You can do dirty things cheaply in Australia,” she said.
“A $2 company and off you go, no one will know what’s going on.”