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Clifford Chance

Clifford Chance

Regulatory Investigations and Financial Crime Insights

AUSTRAC seeks to guide industry

Australian Transaction Reports and Analysis Centre (AUSTRAC) has announced its plan to increase guidance for industry including by establishing a division dedicated to educating and engaging with regulated entities.

The Australian Financial Review has reported on the developments here.

AUSTRAC, Australia’s financial intelligence unit with regulatory responsibility for anti-money laundering and counter-terrorism financing (AML/CTF), has unveiled its plans to deter non-compliance and incentivise AML/CTF compliance by ramping up its industry education and outreach efforts in order to increase knowledge of money laundering and terrorism financing risks across industry.

Increased Guidance

AUSTRAC is preparing detailed risk assessments for key financial institutions including large banks, smaller banks, foreign bank branches, foreign bank subsidiaries and non-bank lenders. These risk assessments will identify gaps and risks for a given sector or product. Sharing these assessments with industry and government
partners is expected to enable more effective identification and management of money laundering/terrorist financing threats.

In addition, AUSTRAC is also preparing risk assessments to international remittance providers, gold, silver and precious metal traders and casino junket operators with the aim of improving the alerting and collaboration capabilities of AUSTRAC and regulated entities in these sectors.

In the wake of the highly publicised financial penalties imposed on Westpac, Commonwealth Bank, Tabcorp and the ongoing investigations into Crown Casino, PayPal and NAB, these risk assessments will undoubtedly be useful tools for industry players.

Education Division

AUSTRAC will also establish a new branch named the 'Education Capability and Communication Branch' which will be overseen by Deputy CEO of Regulatory Strategy, Peter Soros.

The branch has been created to provide education tailored for industry and its plans include workshops to provide more specific guidance to support regulated entities to meet their compliance and reporting obligations and understand their risks.

Ongoing Industry Education & Outreach

AUSTRAC's latest announcement is demonstrative of its proactive effort to increase its regulatory education and outreach activities. In 2019-2020, AUSTRAC was involved in:

  • Publication of a mutual banking sector risk assessment;
  • Publication of financial crime guides on illegal wildlife trafficking and illegal phoenix activity in the labour hire and payroll industry;
  • Publication of 26 forms of guidance ranging from animations, posters, factsheets and insights documents;
  • Facilitation of 15 workshops in Sydney, Melbourne and Perth and a workshop in Papua New Guinea;
  • Community town hall events in Sydney, Melbourne, Brisbane and Perth; and
  • Provision of guidance materials
    to reporting entities to assist in undertaking 'know your customer' processes in the COVID-19 environment (including specific guidance to the Superannuation industry).

Further information on AUSTRAC and its education and outreach activities are available here.