As a seasoned crypto investor with a knack for navigating the ever-evolving regulatory landscape, I find the proposed stricter AML/CTF rules by AUSTRAC to be both challenging and reassuring. Having weathered numerous market cycles and witnessed the maturation of this industry, it’s heartening to see authorities taking concrete steps to combat financial crime while ensuring a stable environment for legitimate players.
Australia is considering implementing stronger regulations for Anti-Money Laundering and Countering Terrorist Financing (AML/CTF), focusing on enhancing surveillance within the cryptocurrency sector to fight financial wrongdoings.
The new guidelines, originating from the Australian Transaction Reports and Analysis Center (AUSTRAC), come after changes to the Anti-Money Laundering and Counter-Terrorism Financing Act that were approved by Parliament in November.
The revised structure intends to address loopholes in regulation, enhance supervision over potentially hazardous industries, strengthen know-your-customer procedures, impose more stringent reporting requirements, and establish tougher business regulations.
The proposed regulations will be open for public comments until February 14, 2025, as AUSTRAC invites input from various sectors, especially those involved in cryptocurrency and financial services, to help shape the ultimate formulation of the guidelines.
Proposed increased oversight
As a researcher, I’m exploring the implications of proposed rule reforms that extend regulatory scrutiny to sectors deemed high-risk, such as cryptocurrency exchange platforms, legal services providers, and real estate enterprises. This expanded oversight aims to ensure compliance, transparency, and risk mitigation in these crucial domains.
The updates would mandate stricter CDD, improved reporting group definitions and tighter Travel Rule obligations for international transfers.
In this new system, businesses are expected to authenticate their customers using a method that considers different levels of risk, keep an eye out for unusual activities in transactions, and ensure openness when moving assets across borders.
Reduced compliance burdens
The framework aims to lighten the regulatory load by shifting from a prescriptive approach to one based on results, focusing more on achieving desired outcomes instead.
This adjustment enables companies to customize their compliance strategies according to factors like size, organizational structure, and risk level, all while upholding stringent regulations.
In the proposed changes, both the AML/CTF General Rule 2025 and the AML/CTF (Exemptions) Rule 2007 were included. The intention was to keep essential exemptions from the old system while eliminating outdated demands to ensure consistency and stability.
Next steps
AUSTRAC made available their draft framework between December 11th and February 14th, 2025, inviting comments from various parties such as financial institutions, lawyers, and crypto exchange platforms during this period.
The proposal follows a pattern of steadily increasing regulatory focus on the crypto industry by Australian authorities, witnessed recently on Dec. 6 when the AUSTRAC created a task force to crack down on crypto ATM providers.
The task force is taking the initial action to guarantee that operators of cryptocurrency Automated Teller Machines (ATMs) adhere to a minimum set of standards, aiming to prevent illegal funds from being transacted through these machines within Australia. This move is part of an effort to curb criminal activities involving cryptocurrencies in the country.
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2024-12-12 12:50