Australia proposes stronger money laundering laws

A branch of the Commonwealth Bank of Australia (CBA) in Sydney. The Australian government's announcement yesterday that it would strengthen money laundering laws comes just days after the Australian Transaction Reports and Analysis Centre accused CBA
A branch of the Commonwealth Bank of Australia (CBA) in Sydney. The Australian government's announcement yesterday that it would strengthen money laundering laws comes just days after the Australian Transaction Reports and Analysis Centre accused CBA of "serious and systemic" breaches of the regulations.PHOTO: BLOOMBERG

SYDNEY • Australia yesterday said it would strengthen its money laundering laws, including bringing bitcoin providers under the government's financial intelligence unit, days after a fresh scandal at one of the country's biggest banks.

The government said a coming Bill would be the first stage of reforms to strengthen the country's Anti-Money Laundering And Counter Terrorism Financing Act.

"The threat of serious financial crime is constantly evolving, as new technologies emerge and criminals seek to nefariously exploit them," Minister of Justice Michael Keenan said, without specifying when the legislation would be introduced.

The Bill will also aim to bolster the investigative and enforcement powers of the financial intelligence agency, the Australian Transaction Reports and Analysis Centre.

The announcement comes just days after the agency accused the Commonwealth Bank of Australia (CBA) of "serious and systemic" breaches of money laundering laws.

But the move is more than two years after global watchdog Financial Action Task Force found significant deficiencies in Australia's anti-money laundering framework.

The more challenging phase of legislative reforms in Australia will be to extend the rules to lawyers, accountants, real estate agents and dealers in high-value goods.

Under Australian regulations, one can pay millions in cash for precious stones or a prime property without having to identify themselves or the source of their funds. Australia had agreed in 2003 to extend strict controls to these sectors, but has yet to act on those promises.

"Stopping the movement of money to criminals and terrorists is a vital part of our national security defences and we expect regulated businesses in Australia to comply with our comprehensive regime," said Mr Keenan. The digital currency exchange sector, which includes bitcoin, will be regulated for the first time, he added.

The Australian Digital Currency and Commerce Association welcomed the reform, saying it will increase safeguards and provide regulatory certainty to digital currency businesses.

Earlier this year, Australia launched a world-first private-public partnership called Fintel Alliance to encourage banks and other financial institutions to provide intelligence to regulators.

Yesterday, Mr Keenan said the private sector was an essential partner in ensuring Australian businesses are not exploited by criminals. He did not say if the Bill was in response to the CBA case.

REUTERS

A version of this article appeared in the print edition of The Straits Times on August 18, 2017, with the headline 'Australia proposes stronger money laundering laws'. Print Edition | Subscribe