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AML survey: Have your say on proposed money laundering and financial crimes reforms

Businesses not regulated under the current Anti-Money Laundering and Counter-Terrorism Financing (AML/CTF) regime have been invited to share their views on the proposed reforms that broaden its scope to include accountants.

The proposed legislative changes will bring Australia in line with other nations to better detect and deter the flow of dirty money by requiring the profession, among others, to conduct due diligence on clients and report suspicious activity.

by | 6 Jun, 2024

Extreme closeup of Sir John's face on the Australian 100 dollar note

Australian Transaction Reports and Analysis Centre (AUSTRAC) has been charged with educating the sectors that will fall under the Tranche 2 laws to tackle criminal abuse in Australia’s financial system.

The financial crimes agency will use the $166.4 million it received in the federal budget to implement the laws and help industries to meet their obligations. This will include education programs for accountants on what steps to take when faced with suspicious activity.

AUSTRAC commissioned an impact analysis survey to help assess potential regulator burden and benefits of the new laws. The survey is designed to “support analysis of the expected regulatory costs and intended benefits of the proposed reforms to AML/CTF obligations”, it said.

Businesses given extension to comment on AML reforms

AUSTRAC extended the deadline by three weeks to 13 June to give small operators a chance to share their feedback. The agency also developed a second version of the full survey that takes less time to complete to encourage more businesses to record their confidential responses to better understand the possible regulatory impact of the reforms.

Specifically, respondents not covered by the existing laws have been asked to provide feedback on:

  • The existing processes and procedures their businesses may use to comply with the AML/CTF obligations;
  • The level of uplift they expect will be required to comply with the new AML/CTF obligations; and
  • Whether they plan to outsource any of their AML/CTF obligations to third parties.

In April this year, Attorney-General Mark Dreyfus announced public consultation on Australia’s AML/CTF regime.

“No legitimate business wants to wittingly, or unwittingly, assist the laundering of money that aids the commissioning of serious crimes including terrorism, child abuse and the illicit drug trade. The purpose of the AML/CTF regime is to assist businesses to identify these risks in the course of providing their services,” Dreyfus says.

Last month, the Attorney-General announced a second round of consultation on proposed reforms. A series of consultation papers, Reforming Australia’s anti-money laundering and counter-terrorism financing regime, outline the reform proposals and include feedback from the first stage of consultation that received 142 submissions.

The Institute of Public Accountants (IPA) are developing a joint submission with CPA Australia and Chartered Accountants ANZ (CA ANZ) in response to the latest AML/CTF consultation process that closes on 13 June. In a previous 2023 submission, they supported modernising the laws to create an “effective regime that detects and prevents criminal activity protects all Australians and the reputation of the nation as a whole as a modern, fair and transparent place to do business”. “To ensure the inclusion of services provided by tranche-two entities is implemented in the most effective and efficient way, and creates the least disruption to complying businesses, the government should harness, not duplicate, existing regulatory and professional obligations which professional accountants must comply,” they said.

The submission notes the accounting profession is “highly regulated” by their professional accounting body and a wide range of statutory regulators depending on the services they provide to help reduce the risk of members being exploited by criminal activities.

“The AML/CTF regime will be most effective and efficient where the government considers the extensive regulatory and professional obligations to which members of the Professional Accounting Bodies are already subject,” it says.

In May, Transparency International Australia (TIA) warned AML/CTF regulatory gaps in Australia made it one of only five countries yet to implement Tranche 2 reforms to prevent millions of dollars of dirty money flowing from Cambodia into Australia, including in Australia’s lucrative real estate sector.

The report by TIA and KordaMentha reveals that between 2019 and 2023, 118 properties worth $110 million were settled by Cambodian foreign persons. In 2022, more than $516 million was transferred from Cambodia to Australia through Australian reporting entities.

Clancy Moore, CEO of Transparency International Australia, says in a statement that “Cambodia is a regional hub for human trafficking, money laundering, and organised crime and this research shows significant amount of money flowing into Australia”.

“Lawyers, accountants and real-estate agents, sometimes unknowingly, enable money laundering by criminals through the setting up of opaque corporate structures, facilitating payments, or simply turning a blind eye,” he says.

TIA’s report said the Tranche 2 reforms would ensure oversight of designated non-financial businesses and professions (DNFBPs) and help reduce the risks of money laundering.


Survey

Please access the survey which you wish to complete using the links provided below. If you intend to complete the survey in multiple stages, please ensure that you use the same device and browser. This will allow any progress to be saved and resumed later.

Full survey

Streamlined survey

Responses provided to Nous Group and the Department will be treated confidentially and will be used only for the purposes of regulatory impact analysis.


Queries

Queries regarding the impact analysis survey process, please contact Nous Group at amlctf@nousgroup.com

Queries regarding the policy reform consultation process, please contact the department at economiccrime@ag.gov.au

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