Michael Pascoe: Money laundering and corrupt cash in real estate – another item for Labor – The New Daily

There is a lot on Labor’s agenda for fixing after the Coalition government, but a place needs to be found ending Australian real estate being used for money laundering and investing corrupt cash.
The previous government walked away from a twice-made commitment to meet agreed international standards to establish a beneficial ownership register.
Last year, when Senator Jane Hume was the responsible minister, the government simply refused to answer questions about the register.
The Morrison government made a play of announcing Russian sanctions, but we simply don’t know what Australian real estate is owned by Russian oligarchs.
The last government seemed not to care much about that, or what other corrupt or criminal funds were invested here, or how real estate transactions were being used to launder money.
And not just real estate. As the Australian Financial Review’s Angus Grigg reported: “The Morrison government has walked away from plans to unmask nominee directors, a move experts claim will entrench Australia as a safe haven for laundered money and the proceeds of corruption.”
The lack of a register has been brought back into focus as a sidelight to James Packer’s success in returning Crown casino’s money laundering to the headlines through his claim that he paid Peter Costello to be a secret lobbyist for Crown – a claim Mr Costello has denied.
An examination of the Packer connections by Michael West Media included an explanation of how casinos run workarounds for clients to bypass Chinese UnionPay card restrictions – and Australia’s anti-money laundering laws.
“The entire Barangaroo project appears designed to enable money to be shifted around anonymously,” reported Michael Sainsbury.
He quoted financial crime expert Nathan Lynch on one of the techniques to get around anti-money laundering rules – get high rollers to put their money through the accommodation business, which is unregulated as it is “property”.
“So you hire a penthouse for a week for a million dollars. And then lo and behold, you get comped a million dollars’ worth of chips when you turn up. So that was all unreported,” Mr Lynch said.
In the Barangaroo tower itself – most of the floors are residential – there were no checks on who bought the units.
Without a beneficial ownership register, the ownership can remain hidden through nominees.
“So the people that came in and bought those units, imagine who they could be. No one knows. They still don’t know,” Mr Lynch said.
“And there is an elevator in that building that takes you from your private apartment down to the gambling floor.
“So they’ve got no visibility in who owns those apartments, but it was literally built as a [money] laundry facility where you buy your apartment, you bring your cash in, jump in the elevator down to the wash house, job done, 4 or 5 per cent. Thank you.”
The Barangaroo Crown casino finally opened this month – and opened rather quietly – under new ownership and management. But the lack of a beneficial ownership register remains.
The Morrison government running dead on disclosing corrupt foreign money invested here was the key local angle Four Corners used last year for its story on the Pandora Papers.
As The New Daily reported at the time, the government’s reluctance to reduce and prevent corruption was limited to rejecting a genuine federal integrity commission.
Banks have copped massive fines for failing to “know their customer” in potential money laundering cases, yet lobbying by the real estate industry and accounting and legal professions has paid off in allowing them to continue to facilitate much bigger washing and investing of the proceeds of crime and corruption.
Stephen Jones replaced Jane Hume as Assistant Treasurer and Minister for Financial Services with the change of government.
The New Daily on Tuesday asked the minister’s office where the government was on establishing a beneficial ownership register. We had not received a reply by last night’s publication deadline.
The government does have a lot on its agenda.
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