Despite signing up five years ago to a multinational agreement to force greater transparency on companies and trusts, Fairfax analysis and Freedom of Information (FOI) documents reveal Australia has done little, if anything, to act on trusts, including avoiding moves to identify the true financial controllers behind them.

Labor's shadow assistant treasurer Andrew Leigh said Australia's poor performance on transparency lies solely with a government that likes an announceable but shies away from meaningful reform on multinational tax avoidance.

"The Turnbull government is always getting tough with the weak, but they go weak when it comes to the big end of town," said Mr Leigh.

Australia is a founding member of the Financial Action Task Force, an international body established in 1989 to help protect the global financial system, including from money laundering and the financing of terrorism.

In 2012 the taskforce toughened its standards, calling for countries to identify beneficial owners (real ultimate owners and controllers) behind companies and, separately, arrangements such as trusts.

Its recommendations include that information be kept up to date and made available to authorities such as police in the battle against tax evaders, organised crime and terrorism. Those recommendations are widely interpreted as a call for a register of beneficial ownership for both companies and trusts.

Almost 200 jurisdictions signed up to act on the Task Force standards, and action was made more urgent by revelations in the "Panama Papers", which sparked public outrage about tax avoidance, including through the use of trusts.

However a Treasury brief to the government contained in Freedom of Information documents notes that while partly compliant with the Task Force standards on regulation of companies, Australia was completely "non-compliant" on trusts.

The Treasury brief, released to the Opposition in March, appears to be based on a 2015 report card on Australia by the Financial Action Task Force itself. Its "Mutual Evaluation Report" highlighted the gaps in Australia's records, noting that both companies and trusts "remain very attractive" to criminals for money laundering and financing terrorism.

Mr Leigh said the FOI documents revealed that even Treasury had noted Australia's "poor transparency practices".

In April 2016, ahead of federal election, the Turnbull government promised to improve transparency around the beneficial ownership of shell companies. The announcement made no mention of trusts.

Then in February, Assistant Treasurer Kelly O'Dwyer released a consultation report reaffirming Australia's "full" commitment to implementing the Task Force's recommendations. The report then notes, however, that the consultation itself was only about companies.

The government has also baulked at action on trusts in its Open Government action plan, an international project between governments and local communities to enhance government accountability.

The final Open Government National Action Plan 2016-2018, launched last year by Finance Minister Matthias Cormann, dropped a reference to the Task Force recommendation which had been included an earlier draft. The section on beneficial ownership issues focuses exclusively on companies.

For its part, Labor has promised greater transparency for trusts including the establishment of a central public register of beneficial ownership of companies, trusts and other corporate structures.

Mr Leigh said other governments including in the UK, had been "jolted" into action on transparency by the Panama Papers. The Cameron government established a register of beneficial ownership in 2016, but excluded trusts.

However, pressure to act is mounting, including from the Organisation for Economic Cooperation and Development (OECD). Pascal Saint-Amans, head of tax at the OECD last year called on countries including to prise open information about trusts. He called on countries to establish new registers of company and trust ownership.

Last week Fairfax Media reported that the number of discretionary trusts in Australia had almost doubled in the last two decades. Unpublished tax office data provided to Fairfax Media reveals there are 643,000 discretionary trusts in Australia holding assets of almost $600 billion.

Discretionary trusts (the most common form of trust) are one of the big three tools for tax minimisation, along with superannuation and negative gearing. Tax law experts estimate trusts cost the government $2 billion a year in foregone revenue.

Deputy tax commissioner Michael Cranston told Fairfax Media that trusts sometimes made it difficult to globally track the owners of assets.

"A trust in Australia might have a controller in Jersey which is in turn controlled by another trust in Panama, and on it goes. So it can be difficult to find who owns what."

Companies are required to put searchable information about directors, shareholders and company finances (for larger firms) in the public domain. There is no equivalent for trusts and no register of trusts. Neither companies nor trusts are required to identify their beneficial owners and no public records are kept of beneficial ownership.

However, almost half the Liberal party room in Canberra has a family trust, significantly more than in the Labor caucus, or among the general public.

Accountability campaigners including Transparency International say the veil of secrecy around trusts in Australia is shielding tax rip offs, corruption, money laundering, even terrorism.

Last week Transparency International launched a report warning that the Australian real estate market was particularly exposed to money laundering by overseas buyers who exploit the cover of trusts and shelf companies.

Transparency's Australian chief executive officer Serena Lillywhite says the "veil of secrecy" around trusts made it difficult to identify the real [beneficial] owners involved in dubious property purchases. "It's an easy way to hide millions of dollars," she says.

Transparency International is calling for a public register of beneficial ownership, including of trusts.

Assistant Treasurer Kelly O'Dwyer has been approached for comment.

Got a tip? Contact us securely on JournoTips

Follow Ben Schneiders on Facebook