convergence

Money Laundering into Real Estate
problem are limited primarily to Denmark and Italy. Indeed, there is little systematic research
examining this problem anywhere outside Europe.
At the same time, a number of significant prosecutions reveal that the profits of organized
crime are often invested in real estate. That is particularly true of investigations into human
trafficking, whose proceeds have been traced by European law enforcement agencies to villas in
Romania and to hotels, bars, and restaurants in Turkey and the Netherlands. 10 A major prosecution
of Russian organized crime in Germany revealed many expensive real estate purchases
in the Stuttgart area by members of a well-known post-Soviet crime group. 11
This analysis is based on interviews with top law enforcement personnel from Europol,
the United States, Latin America, Asia, and Australia. It also draws on the expertise of members
of the Global Agenda Council on Organized Crime of the World Economic Forum
(whose members are leading international scholars and practitioners on money laundering
and transnational crime). Reports, legal documents, and the limited scholarly literature have
been used to the extent possible.
The slim research on money laundering and real estate means it is not possible to know
the extent to which different facilitators are involved in real estate money laundering. Available
cases, primarily from Canada and Europe, reveal that some lawyers, real estate agents and
brokers, notaries, property management and rental firms, and managers of holiday parks either
knowingly or unknowingly facilitate MLRE. 12 But without more comprehensive research, it is
impossible to determine which are the most important facilitators of MLRE. Canadian investigation
revealed that real estate professionals are among the financial professionals most likely
to encounter criminal proceeds (see figure). But there were not a large number of Canadian
cases for analysis. Moreover, comparable data is not available from elsewhere. 13
Professionals Who Came into Contact with the Proceeds of Crime
Deposit institution staff
Insurance Agent
Lawyer
Real estate professional
Automoblie dealer/agent
Accountant
Currency exchange staff
Securities dealer
Other
6.0%
3.4%
4.7%
11.4%
8.7%
38.3%
49.7%
59.1%
67.8%
0% 10% 20% 30% 40% 50% 60%
70% 80% 90% 100%
Source: Margaret Beare and Stephen Schneider, Money Laundering in Canada: Chasing Dirty and
Dangerous Dollars (Toronto: University of Toronto Press, 2007), 135.
133