- AUSTRAC urges inactive DCEs that they could have their registrations cancelled unless they voluntarily withdraw them.
- Inactive DCEs can be targeted by criminals and used for activities such as money laundering and scams.
- A new publicly searchable DCE register will be established to help consumers verify legitimate businesses across the cryptocurrency sector in Australia.
Australia’s financial intelligence unit is warning inactive digital currency exchanges (DCEs) to voluntarily withdraw their registrations or to risk having them cancelled.
In a statement issued on Tuesday, The Australian Transaction Reports and Analysis Centre (AUSTRAC) said that a large proportion of the 427 DCEs currently registered no longer appear to be trading, leaving them vulnerable to criminal exploitation.
In the high-risk cryptocurrency sector, an AUSTRAC registration can give DCEs a sense of legitimacy, making inactive businesses attractive targets for criminals. To minimise this risk, AUSTRAC is requiring DCEs to keep their business details up to date or to risk removal from the register.
AUSTRAC CEO Brendan Thomas said the move will limit the potential for improper sale and use of DCEs for money laundering, scams and money mule activities.
The blitz is aimed at limiting harm to our community, making it harder for criminals to launder their money and improving the integrity and accuracy of our register, so we’re urging businesses to ‘use it or lose it’.
Brendan Thomas, AUSTRAC CEOMoving forward, AUSTRAC will establish a publicly searchable register to help the public identify and verify legitimate DCEs. If a business’s circumstances change, they will be able to re-apply to be on the register.
Related: “Worrying Trends” For Crypto ATM Operators Ahead Of New Anti-Money Laundering Laws, AUSTRAC Warns
Ongoing Efforts to Clean Up the Cryptocurrency Space
This latest blitz follows AUSTRAC’s regulatory action against 13 remittance and DCE providers, with over 50 others on notice for failing to meet reporting requirements.
The year-long campaign targeted repeated under-reporting and non-reporting of suspicious transactions, as required by Australia’s Anti-Money Laundering and Counter-Terrorism Financing Act, resulting in suspensions and cancellations of registrations for offending providers.
The reports are used by AUSTRAC to generate actionable financial intelligence and are used by law enforcement in criminal investigations. “This means remittance service providers and digital currency exchanges play a vital role in detecting and disrupting criminal abuse of Australia’s financial system,” Mr Thomas said.
AUSTRAC’s reporting entities are the front line of defence in detecting criminal activity, which is why it is important for all of them to take their AML/CTF obligations seriously.
Brendan Thomas, AUSTRAC CEORelated: New AUSTRAC Task Force to Combat Crypto ATM Use in Money Laundering
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