The real estate market has long provided a way for individuals to secretly launder or invest
stolen money and other illicitly gained funds. Not only do expensive apartments in New York,
London or Paris raise the social status of their owners and enhance their luxurious lifestyles,
but they are also an easy and convenient place to hide hundreds of millions of dollars from
criminal investigators, tax authorities or others tracking criminal behaviour and the proceeds of crime. According to the Financial Action Task Force (FATF), real estate accounted for up to 30 per cent of criminal assets confiscated worldwide between 2011 a nd 2013.1
Several cases that have come to light in the past year, including the trial of Teodoro Obiang,
son of the president of Equatorial Guinea;2 Malaysia’s 1MDB scandal;3 the Brazilian Car Wash
Operation;4 and the Panama Papers’ revelations,5 offer examples of how high-end property
in key markets may have been used to launder money. In many such cases, property is
purchased through anonymous shell companies or trusts without undergoing proper due
diligence by the professionals involved in the deal.

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