But has also meant that the sector is ripe for money laundering activities, increasingly being used by anti-government groups to channel funds in a region prone to military coups.
“It is alarming in terms of the inroads that the launderers are trying to build in West Africa,” Samuel Amegayibor, the executive secretary of Ghana Real Estate Developers Association (GREDA), the umbrella body of property developers tells The Africa Report.
“These are individuals and they are building properties and selling them but are not registered. We hear all sorts of things and you wonder where these people are getting their money from,” he says. “Most genuine businesses have been killed and we in Ghana cannot sit by and watch money launders take over our industry.”
According to the Financial Action Task Force (FATF), the real estate industry is considered to be a high-risk sector for money laundering and terrorist financing. While the scale of the problem is difficult to quantify, estimates suggest that billions of dollars are laundered through real estate transactions each year.
Moreover, the fact that there is no average market price for real estate property in the region, coupled with the extensive use of bulk cash for payment, poses a particular difficulty in determining who is actually laundering money and how they are proceeding in this sector.
“We have to be on our guard and to be very alert in these areas and open our eyes to ensure that we don’t give them [money launders] the chance,” says Amegayibor.
Tackle the threat
“Authorities must confront illicit money in the real estate sector head-on or else we are all in danger,” says Nana Adjei, a realtor based in Accra. “As things stand now, I’m unable to determine who is buying our properties with dirty money. I’m just a salesperson.”
According to Broll Ghana, an average of about 85,000 property transactions take place in a year for both sales and rentals in the country. The prices of new properties across the country are typically marketed from more than $100,000 and are far beyond the means of the majority of Ghanaians.
“I usually receive cheques as payments for my properties sales… I think that we are all at risk in this [real estate] business,” says XXX.
A West African problem
A report by the Global Financial Integrity (GFI) in 2021 shows a database of more than 100 real estate money laundering cases – from the US, UK, and Canada – reported between 2015 and 2020.
The database, according to the GFI, also shows that in 13% of the US cases, the source of illicit money came from sub-Saharan Africa, with origins including Guinea, Gambia and Nigeria.
However, Ghana is making progress in strengthening the legal regime in the fight against money laundering.
In May 2020, the European Union (EU) blacklisted Ghana among several other countries for money laundering, this was, however, reversed a year later after the country tightened its anti-money law.
