AUSTRAC Urges Entities to Review FATF Financial Crime Updates
Introduction to AUSTRAC’s Advisory
The Australian Transaction Reports and Analysis Centre (AUSTRAC) has issued a notification directed at all regulated entities, advising them to carefully review the latest updates released by the Financial Action Task Force (FATF). These updates address critical international financial crime issues such as money laundering, terrorism financing, and the financing of proliferation.
Recent FATF Financial Crime Updates
AUSTRAC highlighted that the FATF has recently published two significant updates concerning global efforts to combat financial crime. These updates include new assessments of jurisdictions that may present increased risks to international financial systems.
The first update, issued on October 24, identifies several high-risk jurisdictions that require urgent attention and action. Notably, the Democratic People’s Republic of Korea, Iran, and Myanmar were emphasized as regions with significant weaknesses in their anti-money laundering, counter-terrorism financing, and counter-proliferation financing frameworks.
The second update, also released on October 24, focuses on jurisdictions that have been placed under enhanced monitoring. Although these regions have notable deficiencies in their compliance regimes, they are actively collaborating with the FATF to address and rectify these issues.
AUSTRAC’s Guidance for Reporting Entities
In light of these FATF updates, AUSTRAC has advised all reporting entities to thoroughly understand the details and implications of these new assessments. Companies are encouraged to incorporate this information into their risk assessment processes, compliance programs, and decision-making practices to better manage and mitigate exposure to high-risk jurisdictions.
Issues with Suspicious Payment Detection
AUSTRAC’s recent advisory also follows discoveries that certain payment providers under its regulation failed to identify suspicious transactions related to child sexual exploitation. AUSTRAC described these failures as unacceptable, stressing the importance of promptly detecting and reporting high-risk activities.
Brendan Thomas, AUSTRAC’s Chief Executive Officer, emphasized that ineffective monitoring and delayed reporting of suspicious activities hinder law enforcement’s ability to gather vital intelligence needed to apprehend offenders and dismantle criminal networks.
Enforcement Actions Against Non-Compliance
In October, AUSTRAC took enforcement action against specific providers for breaches of anti-money laundering and counter-terrorism financing regulations. This highlights the regulator’s commitment to ensuring compliance and protecting the integrity of Australia’s financial system.
