Proposed AML legislation will make home buying more expensive
An anti-money laundering regime that will cost the property industry $2 billion a year will hurt small businesses and Australians buying and selling property.
THAT’S the view of the Real Estate Institute of Queensland REIQ, which is calling for amendments to the proposed Anti-Money Laundering and Counter-Terrorism Financing Bill.
The Attorney-General estimates the ongoing annual cost of the regime at $2 billion a year for the property industry.
That will hurt small businesses and Australians buying and selling property, according to REIQ chief executive Antonia Mercorella, who represented Australia’s real estate professionals before a Federal Senate Committee.
“The proposed framework doesn’t fully take into account the practical challenges faced by real estate businesses—namely the lack of resources and specialised expertise needed to meet these complex compliance requirements,” said Ms Mercorella.
“The cost of compliance is unlikely to be absorbed by businesses without impacting the end price for buyers and sellers, making real estate transactions more expensive for Australians.”
Large institutions, like the banks, have dedicated teams of specialists and resources to manage AML/CTF checks, due diligence and reporting requirements, she said.
“Most real estate businesses are small, independent operations, often with fewer than five employees, and are not equipped with the expertise or systems necessary to meet the extensive AML/CTF obligations,” she added.
“The skills, knowledge and resources needed to undertake these tasks goes far beyond the reasonable scope of a real estate professional’s training and expertise and requiring them to assume this responsibility is highly inappropriate.
“We support a legislative framework that meets the regime’s objectives and places the appropriate burden on real estate professionals without causing significant impacts, costs and delays to the facilitation of property transactions.”
Ms Mercorella accepts real estate agents should play an active role in the AML/CTF process, undertaking reasonable tasks such as verification of identity and suspicious behaviour monitoring and reporting.
But more complex and highly technical tasks, such as source of funds or source of wealth checks and Politically Exposed Persons (PEP) identifications, should be left to legal practitioners and accountants.
“This approach offers a more balanced solution, one that achieves the desired objectives of the AML/CTF regime without placing unreasonable expectations on real estate professionals or compromising the efficiency of property transactions.”
