Australia exposed again on property money laundering

By Leith van Onselen

For years, MB has called on the federal government to implement the second tranche of anti-money laundering (AML) legislation covering real estate gate keepers, which was promised more than a decade ago and has undergone stakeholder consultations in 2008, 2010, 2012, 2014, and 2017, but has been shelved each time.

MB’s incessant lobbying follows a veritable conga-line of reputable international organisations urging Australia to meet its global commitments to implement AML for real estate gatekeepers, as well as frequent reports suggesting that money laundering through Australian property is rife.

Yesterday, we witnessed another example of money laundering through Australian property, with the son of a former South Sudanese military general living on welfare found to have purchased a $1.5 million property in Melbourne with cash. From The ABC [my emphasis]:

Many Australians struggle to save a deposit for a home, let alone pay for a property in full.

So how did then 22-year-old Ngouth Oth Mai manage to buy a $1.5 million property in Melbourne upfront in 2014 when he had only ever earned welfare payments and lived in housing commission?

That is the question he must now answer in the County Court of Victoria, where the AFP launched civil action under the Proceeds of Crime Act (but not criminal charges).

Ngouth Oth Mai is the son of James Hoth Mai, the former chief of staff to Sudan’s People’s Liberation Army (SPLA), who was sacked in 2014.

According to The Sentry, an anti-corruption watchdog set up by actor George Clooney and activist John Prendergast, military generals in South Sudan earn up to $65,000 a year and the wealth amassed by some of them and their families is unexplained.

The Mai family was on The Sentry’s list.

They discovered the luxury house in Narre Warren while investigating corruption in South Sudan for a report published in 2016, War Crimes Shouldn’t Pay.

This prompted the Australian Federal Police (AFP) to start an investigation…

According to the document, an initial deposit of $155,171 was wired from a bank account belonging to Hoid Establishments, a development company in Uganda, directly into the trust account registered to the Melbourne-based real estate agent that handled the sale in June 2014.

John Chevis, who spent 12 years working on fraud and corruption cases for the AFP and is now an adviser on money laundering for the United Nations, said the transaction should have been the first red flag.

“The real estate agents involved in the sale of the house in Australia should have conducted their own due diligence on the source of the funds, although Australia’s anti-money laundering laws do not currently require it,” he said.

The AFP investigator claims the balance of the million-dollar property and a luxury car was paid by money that was transferred from Africa into National Australia Bank (NAB) business accounts held by a luxury car business registered in Nguoth Oth Mai’s name…

It appears from the report that the AFP was only notified of this transaction because it was flagged by the anti-corruption watchdog, The Sentry, when obviously the Australian real estate agent should have notified the AFP, but didn’t bother as the AML laws do not require it to so.

One wonders, then, how many dodgy transactions slip through without notice because Australia’s real estate gatekeepers (i.e. agents, accountants and lawyers) are not required to report illicit funds and turn a blind eye?

Why won’t the federal government get on with it and implement the AML second tranche? Why does the government continue to ignore the dirty foreign money flooding into Australian property, which is robbing young Australians of a housing future?

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Comments

  1. rj2k000MEMBER

    Because LNP/Labor/Greens are corrupt scum more interested in importing ethnic multicultural vibrancy to prop up their (or their mates) f*ck-u-i-got-mine property portfolios. Vote Hanson.

    • Super Phoenix

      Straya… will die. As will your friends….. Good, I can feel your anger. I am defenceless. Take your weapon. Strike me down with all of your hatred and your journey towards the Moron side will be complete!

    • St JacquesMEMBER

      Put Sustainable Australia as your first preference in the Senate, then vote at will. Pass on the message. Things will only really change as Australia heads unmistakably towards Argentinian status, and now the forever mining boom is slowly subsiding, that only just beginning. Already the cognitive dissonance between a booming “jobs and gwoth” and increasing everyday struggle for ever more people is starting to tell, but only just. Delusions are tough things and our politicians and MSM are doing all they can to maintain them. This is a long war of attrition.

      • Sustainable Australia Party for the non-might-as-well-just-vote-for-the-liberals way of getting the message across regarding immigration and property-related financial insanity.

    • No one will vote for sustainable australia it’s almost a wasted vote. Pauline 1. Sustainable Aus 2. Lab/lnp/greens last!

      • St JacquesMEMBER

        OK. Spread the word – Sustainable Australia either as your first or second Senate vote.

      • Sustainable Australia is absolutely not a wasted vote. Projections I’ve heard are that they should at least get something in the Senate if people who support their platform put them at 1.

        And we may find out that like the phons, beginning with X and P, it’s a wasted vote for someone who’s basically a Liberal crony since they have yet to publicly announce the direction of their preference flows and they could well fool me and end up voting for things I disagree with more often than not. But they do seem to be saying enough of the right things that I think it’s worth giving them a go. (You know the line about it not being possible for it to get worse…)

        My reasoning on that is that the Labor planks I care most about relate to involve curbing non-owner-occupier incentives to buy, hold, flip, etc. housing. So even if my vote results in someone from SAP rather than someone from ALP getting in, I believe they’ll vote with Labor on those issues.

        If my voting SAP prevents the ALP from getting in, perhaps the next time around they’ll consider smart reductions in immigration. Read: not a cut of 20% in every category, but targeted cuts like reducing low-skill temp visas, killing off the investor visas for investors who do anything BUT invest in ASX companies and bona fide tech startups, and even — I’ve got my flamethrower suit on — severely restricting non-English-speaking professionals requiring relicensing in Australia from immigration unless they pursue that relicensing PRIOR TO migrating so that we don’t unintentionally let in just another uber driver or 500. The latter seems harsh, but I’ve spoken to far too many former skilled migrant medical professionals and engineers who lack the language skills to get certified and employed in Australia and who are driving cabs or owning convenience stores today. It just seems to me that there are plenty of Australians who can driver ubers and open convenience stores already, and that if we made more productive use of the immigration places we do offer by bringing in the highest quality people who can walk into jobs in Australia and start creating value beyond fingernail painting, we could reduce immigration by 20% or more and not adversely affect the economy outside the residential property sector. Construction need not worry – there’s pent-up demand for infrastructure to serve the hordes already here, for a couple decades, and with more arriving every year, there will be demand for infrastructure work into the future even if residential building drops a bit. Property agents and other leeches on the other hand…

    • greedypuppyMEMBER

      Simplistic nonsense….face the facts One Nation are part of the problem -a marginalized fringe group spouting racist bile -which just happens to touch on some of the key issues- remind me again what their take on climate change, wealth redistribution, workers rights and corporate tax cuts are not to mention their view of stifling press freedom by axing the ABC…?

      • Who do you propose people vote for to send a message to the major parties, that we won’t sit idle while they sell what’s left of the country? All the while continuing to pump immigration to unsustainable levels?
        People are disenfranchised, they don’t want to vote the major parties because they are one and the same. I won’t be surprised if ON gets a lot of silent votes i.e. Trump style

      • Fair suck of the sav, abc is ridiculous in there bias towards anyone not on the left fringes.
        As far as racist bile the truth hurts the way its presented is ruff no doubt but the truth none the less.
        I do agree re climate change though.

      • That’s 1 reason I struggle with a vote for PHON, anyone who ignores the climate… makes it hard to vote for them.

      • greedypuppyMEMBER

        Kyle -if ABC had not uncovered the rampant exploitation of migrant workers in Seven-Eleven stores or in the agri business world who would have. Or Chinese money funding our rotten pollies. Or the sick arrangement Hanson and her ex lib side kick have. I’m not fan of politically correct rubbish either. But be clear about this the ABC are the only television source still doing investigative cutting edge journalism. SkyNews anyone? Allan Jones? Corey? No thanks Just saying

      • DarkMatterMEMBER

        a marginalized fringe group spouting racist bile

        Have you considered that this histrionic drivel may be mostly in your head?
        Yesterday there was a shocking outbreak of vile racism on Buffalo Road, Ryde, where a bogan snapped and sticky-taped a handwritten sign to an abandoned shopping trolley. You should collate such disgusting outbreaks for future reference.

        Make a list!

      • greedypuppyMEMBER

        Ummm -the burhka wearing incident in the upper house -even Brandis had enough ..no need to make a list -Hansard is record enuff (and for the record I am not pro Islamic fundamentalism)

  2. davidjwalshMEMBER

    well I guess the unfortunate truth UE is that the sheeple don’t know, don’t care and or don’t think it matters to them as they sit back and glory in their ‘wealth’ as they boast about how much their house and (maybe) IP’s are … ‘worth’… so very, very sad ………

    how in God’s name did we all allow this obscenity to happen …… ???????????

    • Answer to your question?………. Property Council of Australia, Real Estate Institute, Law Council (elements of the later), etc etc…..

      • +1
        The elites like the money and are more than happy to sell us down the river.

    • Howard activated the most reptilian parts of the our brains and put the most logical parts of our brains into hibernation.

      Instead of getting richer by inventing a quieter jet engine, the richest 51% of the electorate agreed to get richer by having rural growth boundaries + height limits in capital cities + mass unskilled immigration and stealing wages from the immigrants.

      The poorest bogans were hoodwinked by the ABC into thinking that the males working in petrol stations came over by boat rather than by air. That massive red herring lasted from 2005 till about 2015.

      Now we are approaching a point when 51% of the electorate does not own land.

    • When you use economics what has no or little basis to reality because of – ideological preferences – even though most of it was refuted 50+ years ago David.

    • Barry McKenzie

      This is nothing that a couple of bottles of Grange (good ones) won’t fix. Don’t worry, it’ll all blow over shortly and life will return to normal in the better circles. Bunging a big red here and there as required with some of my selected mates will ensure everything starts flowing again.

      Though if Mal doesn’t manage to pull Scotty into line before the next media cycle ends I might be buying my next Ferrari with Reserve Krug bottles instead of the folding stuff! Funny old boy is our Scotty… that’s why we stuck him in the ales Dept. in the first place.

  3. What about the state governments? They should put huge land taxes on houses unless the landlord can prove that he has an Aussie passport.

    The states should demand that every kid in every government school must have a valid visa + passport or AUS citizenship. If the visa expires, the kid must expelled.

  4. wasabinatorMEMBER

    The property market is in it’s time of need now, so no chance any of this will change.

  5. Leave poor James Hoth Mai alone. He’s just an ordinary mum and dad with a taxable income of less than 80k trying to get ahead.

    • That’s it!

      I also sense the presence of Ray’s Cyst! They’re picking on him because he is brown. Nobody ever questions cash purchases by white tradies or Chinese tourists, why question $1.5m cash held by an African youth (probably on a refugee visa)?

      • TailorTrashMEMBER

        Yes …nice to see our govmint really going after the “black money “…………..wonder how the new task forced so named will steer clear of the Chinese ….they have a sizable vote now ….so don’t come down too heavy ….right chaps ?

    • Exactly the only crime here is being black and the worst kind of black is African Black lol.. Never mind if you’re Chinese with a wad of cash in a suitcase. We’ll just push that deal through. But if you’re black, and funds are coming from Africa. LOOK OUT BELOW!

    • And the Sentry Anticorruption watchdog will be looked into with a fine-tooth comb by ATO… you know… just in case!

      • Thang god that we have someone to persecute watch the watchmen so that they don’t upset the apple cart.

  6. Bill Shorten? Just like mass immigration he has not been asked any questions on this issue and where he stands on it

      • He’s the king of fudging it. Much better at it than Turnbull, who stumbles a little lot when he attempts it. Maybe Bill learnt it from years of telling the bosses one thing and the workers another, Bill is very good at it.

    • Cant stand him, the smug lnp or the delusional greens. What a horrible election this will be…lose lose and loser!

  7. An interesting BBC4 piece about money laundering was played on Radio National yesterday.
    https://www.bbc.co.uk/programmes/b09qd714
    This doesn’t look at real estate, though apparently the UK is just as happy with hot money inflating its land bubble as Australia is. This one looks at shell companies. It also highlights that improving the laws around money laundering in a meaningless act if you then don’t enforce them.

    • A certain “Anna Blight” or “Blithe” from ABA is on line 3 for you sir… She mentioned she was the Queensland premier some years ago.

  8. michael francis

    I walk around with $10k on me in cash and I’m done on terrorism or drug laws. Migrate over here with millions to stash away in property and go on the dole and you’re fine.

  9. drsmithyMEMBER

    I’m surprised all the people who were wailing the other day about how they wouldn’t be able to get cash discounts from their tradies anymore are not vocally defending this bloke’s actions.

    • OT : the other day you were having a go a me for criticizing Microsoft for downloading updates over Metered connections, unfortunately it’s you that got the wrong end of the conversation, I was not complaining about my own download for updating my own laptop (which is typically less than 200MB per month.
      What I was complaining about is that after my PC is updated they (MS) uses my metered mobile connection UPLINK to distribute updates for other peoples computers (total strangers) all done with data allowance that I was paying big bucks for (something like $10/GB) and I was going through several GB per hour while doing nothing. All upload, all benefiting MS but of no value what-so-ever to me AND IMHO it’s absolutely unexpected behavior.
      So I don’t think myself naive or stupid that I find this practice to be nothing short of data allowance theft., and btw it is VERY hard to find out which process is causing this problem…as in they’ve intentional hid the upstream data used by them updating others….somewhat like VW intentionally hiding their Emissions cheats if you ask me…it’s intentionally hidden, it’s deliberate, it’s deceptive, it’s done for commercial advantage ….lets be honest it’s theft and it’s happening on a huge scale.

      • drsmithyMEMBER

        Ok, so that’s a different situation.

        I wouldn’t call it theft, but I do think it’s a poorly chosen default. Should be set to LAN only.

  10. Maybe another Royal Commission to do the governments work?Goverment seems to need permission from the money laundering facilitators before it will do anything.

  11. DreadnotMEMBER

    Money laundering using houses is willful neglect on the part of financial institutions and regulators. Financial digits don’t fly from Sudan, China, or any where else to Australia without private banks and central banks agreeing to the transaction. Why finger the real estate agents, building inspectors, accountants and solicitors making a buck by clipping the ticket on the way through? There are also recognized ways around not using the banking system, but this needs trust between at least two entities in each country with a demand for the currencies and can only deal with limited scale.

  12. The budget is bringing in a cash ban on $10k+ transactions with businesses in 2019, does anyone know if real estate businesses have an exception once again? All the communications suggest when purchasing ‘goods and services’ which makes me assume they won’t have to comply.

    • Of course real estate will be different mate. When you buy a suburban house with $1.5m cash do you buy it from a “business”? …I thought not.

      • Check the actual budget paper. It talks about the measure being targeted at business.

        I’d post you a link but cbf on my phone.

      • No budget paper I have seen explicitly describes which businesses are impacted or excluded.

        A property deposit can be a cash transaction with a business even if they are only a temporary custodian. Hence why I asked the question.

  13. Check the comments on the ABC Facebook post about this article, brainwashed virtue signalling abounding 😛

  14. Expect Police to be told to get their act together – meaning – stop standing in the way of progress. you are scaring foreign investors..

    • They don’t need to be told. They know which side their bread is buttered.

      Don’t you know that negative gearing is mostly used by police, nurses and firies?!

      • Ah yes! The police applying butter with their batons is indeed a sight to behold! Lightly toasted bread at the friendly crackle of a taser and sign me up – I’m there for breakfast!

  15. FeknameMEMBER

    Thank god Hollywood actors are onto good governance. God forbid a government should be…

  16. BubbleyMEMBER

    …when the worst Batman actor ever is better at uncovering corruption than your own government.

    Australia, we have a problem.

  17. Is anyone else thinking:

    1. How did this African fella get into Australia?

    2. How did he get on welfare?

    3. Has he remained on welfare after this discovery?

    • TailorTrashMEMBER

      Malcolm is on to it ………..he said today Straya will not take one more immigrant than is needed …………did Straya need this chap ?……..and if so why ?