AUSTRAC has released its regulatory priorities for this financial year, outlining new plans to reduce the harms from money laundering, terrorism financing and other serious crime.
AUSTRAC CEO Brendan Thomas said financial crime damages Australia's financial system and this year's focus is on preparing to regulate 'tranche 2' industries and targeting gaps in high-risk sectors such as cash and digital currencies.
'Tranche 2' includes real estate agents, lawyers, conveyancers, accountants, trust and company service providers, dealers in precious metals and stones, and other designated service providers.
"This year marks a regulatory shift - from regulation that primarily checks for compliance to one focussed on substantive risks and harms," Mr Thomas said.
"AUSTRAC will look at risk and behaviour at an industry and sector level rather than focussing solely on individual entities."
As part of preparations to implement major legislative reforms in July next year, AUSTRAC is scaling up its workforce and systems to bring around 80,000 new businesses under the AML/CTF regime.
"We're working with existing and new businesses to ensure they're informed about what's expected of them ahead of the changes.
"We will be more direct in communicating what we expect to see from sectors, and clearer about specific failings and risks we want addressed sector-wide."
AUSTRAC is enhancing its intelligence capabilities to better identify sectors that are not managing risk and using those insights to inform its regulatory priorities and enforcement activities.
"We are also focussing efforts where the risk of harm is greatest, for example in digital currencies, which allow funds to move across borders quickly, cheaply and virtually anonymously," Mr Thomas said.
"Cash is also highly susceptible to money laundering because it is anonymous, accessible and widely accepted. While the use of cash in Australia is declining, more than $100 billion is still in circulation.
"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."
AUSTRAC has published a statement of regulatory expectations on its website to specify its approach to both tranches.
"Whether you're already part of the regime or preparing to come into it, we want you to be proactive in preparing and making sustained progress towards compliance.
"As new sectors come on the scene, they will look to established businesses for examples of effective management of money laundering risk, so this is an opportunity to understand our priorities, improve compliance and help us lift standards across the board.
"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," Mr Thomas said.
