Real estate agents and salespersons at a recent consultation workshop hosted by the Real Estate Agents Licensing Board have been reminded to be on alert about suspicious clients.
The workshop in Nadi included a presentation by the Reserve Bank of Fiji’s Financial Intelligence Unit director, Razim Buksh, who noted that it was necessary to regulate the real estate sector, to safeguard it from financial criminal activities linked to money laundering, to make the sector difficult and unattractive for criminals and to detect and trace money obtained from criminal activities.
“It is somewhat easy to launder money through real estate than other formal and traditional institutions (commercial banks and finance companies) because of the current and apparent inadequacy in regulating control, oversight and governance of this sector.”
He also urged agents to report suspicious transactions and to make efforts to establish the source of funds of their clients.
“The real estate sector is in direct contact with buyers and sellers and generally, they know their clients better than the other parties in the transactions, so are therefore well placed to detect suspicious activity or identify red flag indicators.”
Agents and salespersons were encouraged to report suspicious clients or clients who were reasonably suspected to be related to money laundering, terrorist financing or other serious criminal activities, including unexplained wealth and tax evasion. According to the FIU, this is applicable to all types of transactions, regardless of whether cash is involved and the amount of transactions.
Buksh’s presentation noted that suspicious indicators included the use of cash to pay for deposits or full sums for a property or if the deposit on a property is paid for by an apparently unrelated third party. Other indicators include customers (sellers) who unexpectedly offer to pay generous commissions or fees and customers who purchase multiple properties within a short period of time, without being particular about their location and conditions of the properties, as well as customers who purchase property without bothering with an inspection.
Also highlighted at the workshop was the prevalence of foreign realtors entering Fiji and carrying out real estate work here without proper authorization.
“There are cases of foreign realtors from New Zealand advertising places in Savusavu,” noted Investment Fiji manager regional, Lisala Dyer told at the workshop, organized by the Real Estate Agents Licensing Board (REALB).
Dyer said these agents received work visas while in Fiji, though transactions are usually made offshore, and added that their management team would consider putting in a submission to the REALB.
REALB chairman, Dr Abdul Hassan suggested that they tackle the issue via only providing Stamp Duty to locally licensed agents during the transactional process.
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