When the corrupt are looking for ways to launder their illicit proceeds, property is a favourite option. It can be expensive, so large amounts of money can be laundered in a single transaction. But more importantly for the corrupt, it is possible to buy property using secret companies so that you never know who really benefits from the deal.
This is why Transparency International focuses a great deal of attention on the real estate market in our efforts to fight corruption. We do not want the corrupt to have an easy way to benefit from their crimes.
São Paulo: Does corruption live next door? is our investigation into the real estate market in São Paulo, Brazil’s biggest city. It shows how easy it is to disguise the identity of the real owners of more than US$2.7 billion worth of property behind shell companies.
Using newly released public data, the report identifies thousands of high-end properties that are owned through 236 companies registered in secrecy jurisdictions and tax havens, including in the British Virgin Islands, the US state of Delaware and Uruguay.
It is simply not possible to find out who has bought all these apartments and business property in some of the most expensive São Paulo neighbourhoods.
Transparency International is calling on the Brazilian authorities to:
- Pass legislation that provides a legal definition of beneficial ownership.
- Make the national company registry available online, in open data format with information on beneficial ownership.
- Publish data on beneficial ownership information of all companies that own property in Brazil, whether they are incorporated domestically or overseas.
How the corrupt launder money via real estate and luxury goods
- Doors wide open: Corruption and real estate in four key markets is a Transparency International investigation that identifies the ten main problems related to real estate and money laundering in Australia, Canada, the UK and the US.
- Tainted treasures: Money laundering risks in luxury markets shows how luxury goods sellers – from jewellers and real estate agents to yacht builders and diamond brokers – do little if anything to check if their customers are using corrupt money to fund their high-end purchases.
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