Amid allegations wealthy Chinese ­citizens are secretly transferring money into overseas property markets, Australian banks’ are being queried at various levels including the claim of the ‘mis-using’ of the ‘Significant Investor Visa’ funds for investment into Australian real estate, reports the Australian Financial Review.

Banks are telling a parliamentary economics committee inquiry investigating the foreign investment in Australian real estate, that they there are limitations on what they know about foreign real estate investors.

The AFR reports that the Macquarie Group was asked what it did to make sure loan clients were not mis-using the “Significant Investor Visa” and diverting the funds into property assets: “Macquarie said it did not directly monitor how loaned funds were being used but it had the power to call in the loan or seize collateral early if clients were dishonest.”

ANZ, which is targeting Asian customers, was asked whether it traced the source of income for individual foreign buyers when it was lending money to domestic property developers.

The bank’s response, said it did not trace foreign buyers’ source of income, but it checked the post-codes of “pre-sales” to make sure they were genuine.

The AFR reports that there are allegations wealthy Chinese residents are using back-channels to move money out of the country, including into Australian property.

“Chinese media estimates 20 billion yuan ($3.4 billion) has been moved out of China illegally since 2011 via banks. Macquarie analysts cited this figure in a report last week, alongside estimates Australian lending to non-residents had surged 27 per cent in the year to March. At a time of heightened interest in foreign property purchases and strong house price growth, the analysts said the latest allegations provided “food for thought”.

Foreign investment in residential real estate, especially from China, has surged recently, giving rise to fears it is pushing up home prices.

Figures provided to the inquiry by Treasury show approvals of overseas purchases were $24.8 billion in the first nine months of 2013-14, a jump of 93 per cent on the previous year. In 2009, the Rudd government removed a 50 per cent limit on the proportion of new dwellings that could be pre-sold to foreigners off the plan. However, ANZ last month told the committee that banks would generally not want to participate in property projects where more than 30 per cent of the units were being sold to overseas buyers.

Despite the concern about the growing role of overseas investors in the property market, ANZ also said customers who needed approval from the Foreign Investment Review Board made up just 0.3 per cent of its $200 billion loan book.

The Reserve Bank has also argued foreigners are probably not crowding out first-home buyers though it concedes there is a need for more data on the sensitive topic.