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Thursday, 10 December 2020
Page: 7412

Senator SCARR (Queensland) (10:14): I think Senator McKim might have been watching a bit too much Netflix over the last year. Obviously he's watched a lot of episodes of Breaking Bad, and Better Call Saul, which, I must say, is one of my favourite spin-offs of a TV series. He seems to have this view that the Australian legal profession is infested with people who are prepared to engage in money-laundering practices. The truth of the situation is far, far removed from that.

With respect to my profession, the legal profession, I note that Senator Watt, on the other side of the chamber, is an extremely honourable member of that most noble profession. He practised with great distinction in my home state of Queensland. Who knows where that may lead Senator Watt in the future? I should say that the legal profession has many legitimate concerns with respect to the extension of anti-money-laundering laws to the profession. I note that Senator McKim often refers to submissions from the Australian Law Council, and I myself do the same thing. I want to quote from a submission from the Australian Law Council in the context of anti-money-laundering legislation:

If a client is not able to rely on the security of client legal privilege from the very outset of their relationship with their solicitor or barrister, it risks diminishing the effective and proper administration of justice …

When the Australian Law Council raises legitimate concerns with respect to the extension of anti-money-laundering legislation into the domain of their profession, I think that all of us in this place should pay great heed. This isn't some sort of rhetorical flourish or some sort of hypothetical. The reality is that, in Canada, the Canadian Supreme Court has actually struck out parts of Canadian anti-money-laundering law on that very basis—that it inappropriately infringed upon that all-important lawyer-client professional privilege relationship. This isn't fanciful stuff; this isn't Senator Scarr getting up and seeking to put forward obscure hypotheticals. The fact of the matter is: the Canadian Supreme Court actually struck down some of the Canadian anti-money-laundering legislation on the basis that it improperly infringed upon the lawyer-client professional relationship—an extremely important relationship—which is one of the things that goes to the heart of the rule of law in our country.

Senator McKim interjecting

Senator SCARR: I'll take that interjection from Senator McKim. These are very complicated issues. If you don't have appropriate regard to institutions such as lawyer-client professional privilege, then you'll get the result that they got in Canada, where the Canadian Supreme Court actually struck down anti-money-laundering legislation because it inappropriately infringed on that all-important lawyer-client professional privilege.

In relation to real estate agents, which Senator McKim referred to, I must say that the characterisation of Australians going to their local auction and competing and bidding against money launderers and terrorist organisations et cetera—and as they're bidding against each other, the price of houses goes up and up and up—did tend to go into the realms of absolute fantasy. I, like many Australians, go to my local auctions in my local area. I can't resist. I tell my beautiful wife, Louise, that I'm happy where we live, that we don't need to move. But we can't resist the urge to go to local auctions in our local neighbourhood. I must say, when I attend my local auctions, I don't see them particularly well populated with money launderers and terrorists and others bidding up auction prices so that good, hardworking Australians are kept out of the property market—quite the contrary, actually.

I must say Senator McKim does speak with great rhetorical flourish. I've been in this place for nearly 18 months, and I do admire watching Senator McKim talk. Sometimes the phrases he uses are somewhat repetitive—'government for the mates, by the mates' et cetera. There are a few stock standard phrases that get repeated from time to time. Senator McKim is extremely effective in what he says, but I think he lets himself down when his rhetorical flourishes enter into the world of fantasy. I think it actually erodes his arguments. The practical concern that has been raised by real estate agents across this country is that the vast majority of real estate agents do not come into contact with money-laundering activities—the vast majority. The figure I've seen in the literature that I've read is that 80 to 90 per cent of real estate agents are not at all exposed to the activities of those who launder dirty money.

In this debate, as with everything that comes before this chamber, I think we have to strike the right balance. We have to strike the right balance between regulation that promotes the rule of law and regulation that promotes identifying the rotten fruit that grows from the evil tree of organised crime and terrorist activities et cetera. We need to balance that legitimate public concern with the cost of regulation that would be imposed upon a whole range of professions if Senator McKim were to have his way. The bill before the chamber, the Anti-Money Laundering and Counter-Terrorism Financing and Other Legislation Amendment Bill 2019, strikes the right balance. Australians should be heartened that both the coalition and the Labor Party in this place see the bill as striking the right balance. I think that's a very good touchstone.

Lastly, I commend the provisions of the bill which deal with identification procedures. In my prior life, I had cause, as a company secretary and general counsel, to deal with what are typically called KYC—know your client, know your customer—identification procedures. I remember on one occasion, in dealing with a finance transaction where there were 10 banks involved, having to produce folders and folders of personal identification data. Having all the parties in the transaction going through that repetitive administrative process was, in my view, an example of where there were opportunities for regulatory savings to be made if businesses could meet their obligations in a more cost-effective manner and streamline the customer experience with respect to those 'know your customer' identification procedures. The streamlining of these procedures is not undermining the intent of the legislation to tackle money laundering. It is considered that the reforms contained in this bill will potentially result in an 80 per cent reduction in the costs of customer verification. That has to be a good thing. These arrangements are expected to generate a regulatory saving of approximately $3.1 billion over 10 years. That's one of the reasons why I'm very pleased to commend this bill to the chamber.