The Ghana Real Estate Developers Association (GREDA) has voiced concern over the surge of illicit funds into the real estate sector, signalling potential economic repercussions.
The association highlights the sector’s vulnerability to money laundering, attributing it to tightened banking systems diverting illicit money toward real estate.
GREDA’s Executive Secretary, Sammy Amegayibor, stressed the widespread nature of this issue, extending beyond Ghana to the entire West African sub-region.
The Inter-Governmental Action Group against Money Laundering in West Africa (GIABA) corroborated this concern at a recent conference attended by real estate stakeholders in the region.
Amegayibor pointed out that real estate’s high value, low transparency, and ease of ownership transfer make it an attractive target for money launderers.
With tightened banking systems, real estate becomes a new frontier for money laundering, with individuals purchasing properties in the names of relatives or friends, complicating the tracing of illicit funds.
The presence of laundered money in real estate poses a significant economic challenge, causing property prices in urban centres to skyrocket.
The phenomenon results in unoccupied high-rise buildings, allegedly acquired with illicit funds, becoming common in cities like Accra.
Laundered money not only affects the economy but also has severe social consequences, providing resources for criminal activities, including drug dealing, terrorism, and corruption.
GREDA emphasizes that collaboration between regulators and real estate professionals is essential to implement robust safeguards and detection mechanisms.
Mr Amegayibor highlighted GREDA’s efforts to sensitize members about money laundering and urged thorough background checks on clients before engaging in high-value transactions.
The association advocates for a collective effort to curb illicit activities and protect the integrity of the real estate sector.
“The need for countries to have strong anti-money laundering mechanisms, coupled with the enhancement of transparent financial integrity, therefore cannot be over-emphasized. Real estate, the financial sector, security agencies, and government must work hand-in-hand to address money laundering holistically,” concluded Mr Amegayibor.
