Australia’s corporate regulatory system is not up to scratch.
This means it is far too easy for people who may have been involved in corruption and other illegal activities to register companies, and their nominee directors, in Australia. They can register without adequate due diligence checks, beneficial ownership disclosure, identification of potential links to politically exposed persons or a robust assessment of their business activities and legitimacy, both in Australia and internationally.
In March 2021, Transparency International Australia (TIA) hosted the Doors Wide Open webinar to discuss these flaws in the system and the risks it poses both in Australia and the region. We heard just how easy it is for companies and their associated entities – often with opaque business structures – to be registered in Australia. This enables entities to use Australia as a launching pad for dubious activities, including money laundering and other corrupt conduct.
Australia must step up its diligence on who is doing business here, and an improved corporate registry system would help. It would provide legitimacy and protection to businesses, mitigate risks for financial institutions and support regulators to undertake compliance activities.