Distance Ownership
Property titles in company names distance criminals from ownership.
ML Risk
Shell Companies. A Key Money Laundering Risk
What are shell companies and how are they used for money laundering? Learn about AUSTRAC guidance on shell company risks.
What are shell companies?
According to AUSTRAC's strategic analysis, shell companies are commonly used to launder money, particularly through real estate. Property titles held in the name of a shell company distance the criminal from ownership, with control vested in third parties to avoid any obvious links.
Front companies, shell companies, trusts and company structures established domestically or offshore are used to obscure beneficial ownership.
How shell companies are used
Third Party Control
Control vested in third parties to avoid links to criminals.
Offshore Structures
Domestic or offshore entities used to obscure beneficial ownership.
Real Estate Risk
Shell companies commonly used to launder money through property.
Frequently asked questions
What is a shell company?
A shell company is a legal entity with no significant assets or operations, often used to obscure the true ownership of assets or funds.
How are shell companies used for money laundering?
According to AUSTRAC, shell companies distance criminals from ownership of assets like real estate, with control vested in third parties to avoid obvious links.
What are the red flags?
Complex ownership structures, nominee shareholders, bearer shares, reluctance to identify beneficial owners, and post office box addresses without business premises.
Related resources
Identify beneficial owners
ARCaml helps identify the true owners behind complex corporate structures.