Login
iscover
New AML/CTF laws will mark one of the most significant changes to real estate in decades. The REIQ has said the regime brings serious responsibilities, higher costs, and a need for much education.
Following the tabling of the final Anti-Money Laundering and Counter-Terrorism Financing (AML/CTF) rules in Parliament, Antonia Mercorella, CEO of the Real Estate Institute of Queensland (REIQ), noted that “the expansion of the regime into real estate will represent one of the most significant material changes to real estate in Queensland and indeed the country”.
“The new laws will result in real estate practitioners carrying very serious responsibilities. It is clear they will add a significant administrative burden to real estate businesses,” she said. “As a result, there will be a financial impact; some of which will be borne by consumers, and some by real estate businesses.”
Mercorella added that while the industry is used to dealing with multiple layers of strict legislation, this is different in its seriousness and complexity.
“AML and CTF laws are not new in this country, but the entities that normally comply with them like casinos or banks are far better resourced. In real estate, the majority of businesses are very small,” she said.
She also pointed to the unique complexities the real estate industry will face. For one, real estate transactions differ across jurisdictions, such as in Queensland, where agents have the right to facilitate contracts all the way through to execution and solicitors may not become involved until after the contract is fully executed.
In addition, agents will be responsible for due diligence not only on their own clients who are typically the sellers, but also on buyers.
“That creates further difficulty, because agents will be required to request sensitive and personal information from people who are not their direct clients,” she explained.
Mercorella will speak at AML Edge 2025, 2nd Edition, on 21 October, the only AML conference built specifically for Tranche 2 entities. She will lead a dedicated track for real estate.
A question of reasonableness
“AML and CTF laws are important, but it really is a question of reasonableness,” Mercorella said.
“It is reasonable for agents to take on responsibilities such as verifying identity. Our concern is with more onerous obligations, such as politically exposed person’s identification, complex due diligence, or investigating intricate trust structures to determine beneficial ownership.”
She argued that such responsibilities are a lot for real estate agents.
“With respect, agents do not have the expertise, training, or education required to undertake activities of this complexity and seriousness. Should we be delegating the policing and prevention of money laundering and terrorism financing to small businesses?”
A need for education
One of the biggest consequences of the new legislation is that real estate agents will have to think very seriously about the quality of the training that their employees receive.
She said that this education must cover not only the legislation itself, but also practical issues such as recognising suspicious behaviour, establishing beneficial ownership, and determining whether an individual is a politically exposed person. It will also have to cover verifying identity in a way that both meets legal obligations and respects privacy laws without leaving agents responsible for storing sensitive data.
She noted that industry bodies such as the REIQ expect to play a role in this education. However, she also stressed that government-led consumer education will be equally important.
“We are seeing the community become increasingly privacy-conscious, and there is likely to be pushback if real estate agents begin asking questions that the average person does not understand the need for. That’s why a government-led education campaign will be critical,” Mercorella concluded.
Hear more from Mercorella and other real estate industry compliance experts at AML Edge 2025. Limited spaces remain. Secure your tickets here: www.amledge.com.au.
You are not authorised to post comments.
Comments will undergo moderation before they get published.