The Australian Transaction Reports and Analysis Centre
(AUSTRAC), Australia’s financial intelligence agency and anti-money laundering
and counter-terrorism financing (AML/CTF) regulator, implemented
new laws for digital currency exchange (DCE) providers operating in the
country. This refers to any business which provides exchange services to
convert fiat currency (for example, in Australian or US dollars) into digital
currency and vice versa.
The new AML/CTF laws cover for the first time regulation of
service providers of cryptocurrencies, including bitcoin.
The Anti-Money Laundering and Counter-Terrorism
Financing Act 2006 requires regulated entities to collect information
to establish a customer’s identity, monitor transactional activity, and report
to AUSTRAC transactions or activity that is suspicious or involves large
amounts of cash over $10,000.
Effective immediately, DCEs with a business operation
located in Australia must now register with AUSTRAC and meet the Government’s
AML/CTF compliance and reporting obligations. This includes reporting
suspicious matters and threshold transactions to AUSTRAC and keeping records
relating to customer identification, transactions, and your AML/CTF program.
program developed, adopted and maintained by the DCE needs to set out the ways the
business will comply with its AML/CTF obligations and identify, mitigate and
manage money laundering and terrorism financing (ML/TF) risks.
There is a transition period until 14 May 2018 to allow
current DCE businesses time to register.
AUSTRAC CEO Nicole Rose PSM said the new laws will
strengthen the agency’s compliance and intelligence capabilities to help DCEs
implement systems and controls that can minimise the risk of criminals using
them for money laundering, terrorism financing and cybercrime.
Ms Rose said the new laws had been generally welcomed by the
digital currency exchange sector.
“It’s recognised that this reform will help protect their
business operations from money laundering and terrorism financing, while
regulation will also help strengthen public and consumer confidence in the
sector,” she said.
“AUSTRAC now has increased opportunities to facilitate the
sharing of financial intelligence and information relating to the use of
digital currencies, such as bitcoin and other cryptocurrencies, with its
industry and government partners. The information that these businesses will
collect and report to AUSTRAC will have immediate benefit in the fight against
serious crime and terrorism financing,” Ms Rose added.
Guidance on AML/ CTF programs can be accessed here.