The Cambodia Financial Intelligence Unit (CAFIU) office in Phnom Penh. Facebook
The Cambodia Financial Intelligence Unit (CAFIU) has refuted claims made by Transparency International Australia (TIA) which questioned the sources of money used by Cambodians to purchase residential properties in Australia. The NGO suggested that some of the purchases may have been a form of money laundering.
“The unfounded claims in the report are prejudiced against Cambodia and undermine its continuous efforts to combat money laundering and the financing of terrorism,” said CAFIU, in response to an inquiry by The Post.
Last week, a joint report by advisory firm KordaMentha and Transparency International Australia, titled “Stopping Dirty Money in Australia and Cambodia”, claimed that more than AUD$516 million ($339 million) in capital flight was transferred from Cambodia to Australia in 2020 alone.
It said a total of 118 properties worth at least AUD$110 million ($72 million) were purchased in Australia by “Cambodian foreign persons” from 2019 to 2023. In the 2022-23 financial year, it said AUD$33.4 million ($22 million) worth of Australian residential property was purchased by foreign nationals from Cambodia.
While the report acknowledged that the money transferred to Australia had gone through regulated entities, the NGO alleged that Cambodia was “a regional hub for money laundering, human trafficking and the drug trade”, TIA’s CEO Clancy Moore was quoted as saying by ABC Australia.
A CAFIU representative told The Post that the funds were transferred through regulated entities in Cambodia to regulated entities in Australia and that there is “no evidence” that the money emanated from illegal activities.
The unit noted that Cambodia shares close cooperation with the Australian Transaction Reports and Analysis Center (AUSTRAC) through a Memorandum of Understanding. Both sides engage in regular training sessions and share experience to combat money laundering.
CAFIU added that the Kingdom has developed robust legal frameworks and mechanisms to effectively combat money laundering. These frameworks are continually reviewed and updated to ensure their adequacy in addressing emerging threats and vulnerabilities.
“Moreover, Cambodia is actively engaged in strengthening its legal and regulatory frameworks as part of a broader strategy to enhance transparency, integrity, and accountability across various sectors,” it said.
“One key strength of Cambodia's anti-money laundering regime is strong cooperation among relevant authorities. Collaboration between law enforcement agencies, regulatory bodies and financial institutions plays a pivotal role in detecting and preventing illicit financial activities,” it continued.
Cambodia was removed from the Financial Action Task Force's (FATF) grey list in February last year. The removal is a “testament to the international acknowledgment of Cambodia's commitment and efforts in combating money laundering”, according to CAFIU.
“This achievement reflects Cambodia's substantial progress in addressing the effectiveness of its anti-money laundering measures,” it added.
CAFIU explained that the recognition by FATF, which led to the Kingdom’s removal from the grey list, highlights Cambodia's proactive approach in mitigating money laundering risks and taking prompt action to address any identified deficiencies.
They described it as a clear indication that Cambodia has implemented robust measures to combat money laundering effectively, thereby safeguarding the integrity of its financial system.
“Acknowledging Cambodia’s progress in combating money laundering is essential for providing a balanced perspective on the issue. We remain committed to further enhancing our anti-money laundering efforts and ensuring that Cambodia's financial system remains resilient against illicit financial activities,” it said.
The Post also sought responses from TIA as to why Cambodia was specifically chosen to highlight claimed deficits in Australia’s anti-money laundering measures, and how they could ensure that their claims were factual. The questions went unanswered.
When asked for comment on the report’s findings and what further action may be taken, the Australian Department of Foreign Affairs and Trade noted via email that the Australian Embassy in Cambodia was aware of the report by Transparency International.
"The Australian Government is committed to ensuring Australia’s Anti-Money Laundering (AML) and Counter-Terrorism Financing (CTF) regime continues to deter, detect and disrupt money laundering. The Australian Government is currently consulting on reforms to its AML/CTF regime, which will extend the regime to the real estate sector," it said.
Australian development assistance is helping to build the Kingdom’s capacity to fight transnational crime and strengthen regulatory regimes. For example, under the Mekong Australia Partnership on Transnational Crime, AUSTRAC has delivered several financial intelligence capability uplift activities to Cambodia, most recently in February 2024 in Phnom Penh.
