Money laundering bill to 'burden' accountants with additional costs, warns Coalition
The Member for Bradfield has raised concerns about the billions of dollars in costs the bill will impose on accounting firms and other professions.
Federal Member for Bradfield Paul Fletcher has raised concerns about the $13.9 billion in new costs the expansion of the Anti-Money Laundering and Counter-Terrorism Financing Amendment Bill is expected to impose on a range of industries including accounting firms, real estate firms and smaller legal practices.
In a speech in Parliament this week, the Shadow Minister for government services and the digital economy Paul Fletcher said the Anti-Money Laundering and Counter-Terrorism Financing Amendment Bill 2024 will increase costs for small businesses all over Australia and also for those providing professional services to these businesses.
The bill expands Anti-Money Laundering and Counter-Terrorism Financing Amendment Bill Act to lawyers, accountants, real estate agents, gemstone dealers and other designated non-financial businesses and professions.
"Almost 90,000 businesses across Australia will now be subject to this complex new regime. It is a massive step, and one that [the Coalition] takes very seriously," said Fletcher.
Fletcher noted that Treasury modelling suggests that the bill will result in $13.9 billion in new costs over 10 years.
"Who pays these costs? It's the accountants who do the tax for cafes and bookshops and for mums and dads who engage someone for help with their financial affairs. It's the real estate agents who manage sales and rentals. It's the country lawyers who run small practices in rural and regional areas around our country. These are the people who will be pay," he said.
"The odds are that these additional costs will be passed on to Australian families."
Fletcher said the bill will see businesses slugged with billions of dollars in new costs in the middle of a cost-of-living crisis.
The Treasury Modelling suggests that providers of accounting services alone could be hit with $2.883 billion in additional costs over the ten years.
The Law Council has also previously warned that the package of measures in the bill are complex and may place the viability of 93 per cent of Australia's law practices, which are small one to four partner firms, under threat.
Fletcher warned that the benefits of the bill are also still uncertain, particularly for the businesses that will be affected by the new regulations.
"The government claims that there's somewhere between $2.2 billion and $2.4 billion in quantifiable benefits over 10 years as a result of improvements in combating crime. Keep in mind that none of these upside benefits flow to the businesses that pay the costs in the first place," he said.
In a statement issued last month, Attorney-General Mark Dreyfus said the reforms were critical to strengthening Australia's anti-money laundering regime and protecting Australians and the economy from the impact of transnational, serious and organised crime.
The bill expands the regime to certain services, provided by “tranche two” entities, including lawyers, accountants, trust and company service providers, real estate agents and dealers in precious metals and stones.
"We also intend to modernise the AML/CTF Act to ensure it keeps pace with the increasingly digital, instant nature of our global financial system — closing those gaps that we know increasingly sophisticated, professional criminal organisations can exploit," said Dreyfus.
The Australian Institute of Criminology (AIC) and the Australian Transaction Reports and Analysis Centre (AUSTRAC) released a research report on money laundering and terrorism financing and their social and economic impacts early last month.
The report analysed the link between money laundering and organised crime, using data on organised crime groups known to law enforcement from the Australian Criminal Intelligence Commission and suspicious transactions reported to AUSTRAC.
"The research finds that larger amounts of money are being laundered through the real estate and gambling sectors, relative to other sectors," said Dreyfus.
"It also finds that when organised crime groups include professional facilitators among their membership — tranche two entities such as lawyers, accountants and real estate agents — they are more likely to be involved in money laundering and with larger sums involved."
