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AUSTRAC Reveals Regulatory Priorities, Targets Crypto
- The AUSTRAC Regulatory Priorities 2024 document outlines an enhanced focus on Digital Currency Exchanges and other sectors like banking, gambling, and remittance.
- This appears to be driven by rapid growth, compliance challenges with AML/CTF regulations, and exposure to diverse criminal threats.
- AUSTRAC, established in 1989, is Australia’s financial intelligence unit and AML/CTF regulator.
- Michael Bacina, Chair of Blockchain Australia, highlighted that exchanges in Australia are only required to register with AUSTRAC, not obtain a full licence, leading to less oversight.
Regulatory Focus on Exchanges in 2024
AUSTRAC, the Australian Transaction Reports and Analysis Centre, just released its 2024 regulatory priority focus. And yes, you guessed right, crypto is – while not mentioned as such and referred to as ‘digital currency’ – on the radar.
The AUSTRAC Regulatory Priorities 2024 document highlights an increased regulatory focus on several sectors, including Digital Currency Exchanges (DCEs). This increased focus is due to the rapid and significant growth in these sectors, concerns about compliance with Anti-Money Laundering and Counter-Terrorism Financing (AML/CTF) regulations, and notable variations in compliance levels among reporting entities in these sectors. Additionally, this focus is driven by intelligence and concerns from AUSTRAC and its partner agencies.
Apart from the increased regulatory focus on Digital Currency Exchanges (DCEs), the AUSTRAC Regulatory Priorities 2024 document also emphasises the ongoing focus on the banking, gambling, and remittance sectors. These sectors are highlighted due to their exposure to significant and varied criminal threats and widespread vulnerabilities. These vulnerabilities stem from factors such as the customer base, the products and services offered, the significant use of cash, and the scale of operations in these sectors.
Intensified Scrutiny Across Financial Sector
This broader context suggests that AUSTRAC is intensifying its scrutiny across a range of financial activities, with a particular emphasis on sectors that have seen rapid growth and where there are concerns about compliance with AML/CTF regulations. Digital currency exchanges are a part of this larger regulatory effort to address potential risks in the financial system.
Criminals target businesses with weak anti-money laundering settings, which is why AUSTRAC’s regulation, through education and supervision, is crucial to safeguarding Australia’s communities and financial systems from financial harm.
Acting CEO Peter Soros Who is AUSTRAC?
AUSTRAC, established in 1989, serves as Australia’s financial intelligence unit and primary anti-money laundering and counter-terrorism financing regulator. Operating under the Australian government, it is pivotal in safeguarding the financial system from criminal and terrorist exploitation, ensuring the integrity of Australia’s financial system, and aiding in the global fight against financial crimes and terrorism financing.
Blockchain Australia on AUSTRAC
At the Australian Crypto Convention in November, Michael Bacina, Chair of Blockchain Australia, emphasised the current state of crypto regulation in Australia. He noted that crypto exchanges are only required to register with AUSTRAC, rather than obtain a full licence, which provides less oversight. This licensing requirement currently applies mostly to funds.
It’s not just a distinction that lawyers and government like to make in law. Of course, anyone who’s dealing with crypto assets, which are financial products, is supposed to have an AFSL, and what we mostly see in that space currently is funds.
Michael Bacina, Chair of Blockchain Australia 
Author
Aaron Feuerstein
Aaron Feuerstein is a freelance writer based in Melbourne. His focus is on decentralised finance and the regulatory space surrounding blockchain. He holds a Master's in Accounting. When he is not studying the latest legal case, he enjoys his time as a modest but eager hobby cook.
