Crypto Tops List of Financial Crime Risks, Says Australian Regulator

AUSTRAC, an Australian government financial intelligence agency, has unveiled its key enforcement priorities, targeting money laundering, terrorism financing, and serious organized crime. 

According to an official announcement, the agency is investing in enhanced intelligence tools to detect sectors with inadequate risk controls. It leverages this information to guide regulatory focus and enforcement measures. 

AUSTRAC Flags Ongoing Money Laundering Risks 

The securities watchdog further revealed that risks associated with money laundering continue to surface in businesses dealing primarily in cash and crypto exchanges. Commenting on the report, AUSTRAC CEO Brendan Thomas said:

“We see money laundering risks play out in cash intensive businesses as well as through digital currency exchanges and other virtual asset service providers that facilitate instantaneous global transfers.” 

To prepare for upcoming regulatory reforms scheduled for mid-next year, AUSTRAC is enhancing both its personnel and operational systems to onboard nearly 80,000 entities into the national anti-money laundering and counter-terrorism financing structure (AML/CTF).

In addition, the agency will adopt a more transparent communication strategy. It will also outline expectations for different sectors, with a sharper focus on identifying common risks and challenges that affect them. As such, the authorities are collaborating with current and incoming businesses to ensure they are aware of the requirements ahead of the planned reforms.  

Reforms Intensify Amid Illicit Finance Cases

According to the report, despite a steady decline in cash use across Australia, more than $100 billion is still circulating, raising concerns. AUSTRAC said cash remains an attractive medium for money laundering and illicit purposes. 

“We’re about to embark on the most ambitious overhaul of Australia’s anti-money laundering laws in a generation, and we’re determined to get it right,” Thomas wrote. 

Meanwhile, these reforms come as a high level of money laundering and illegal practices are surfacing in the country. On May 28, Liang Allen Guo, the former director of Blockchain Global Ltd., was alleged to have mishandled and misused user funds.  

CoinTab reported that the platform owed approximately $59 million to unsecured creditors, including $22 million to former ACX Exchange customers.  

To ensure the safety of investor funds, the country earlier proposed crypto regulations to boost digital asset integration. The strategic step reflects the growing shift towards overseeing crypto assets in traditional economic structures.  

Ultimately, officials revealed that the Treasury, ASIC, and the Reserve Bank of Australia are set to launch pilot projects. These projects will test the use of stablecoins and other forms of tokenized money to settle trades in wholesale tokenized financial systems.