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More emphasis from the regulator

Australian Transaction Reports and Analysis Centre’s (AUSTRAC) Deputy CEO on Regulatory Strategy Peter Soros has announced there is more legal action ahead when it comes to breaches of the AML/CTF Act.

However, he also added that both the CBA and Tabcorp cases have had an impact on the amount and quality of Suspicious Matter Reports being received by the Financial intelligence Unit.

“It’s fair to say the AML Act and its requirements were varied across our 14,000 reporting entities and I think it’s also fair to say that, since those two matters, there is much better understanding, much greater interest and much bigger investment from the reporting entities that we regulate.”

Interestingly, there are more self-disclosures when it comes to finding gaps in processes, an issue Soros believes is not easy for larger organisations to rectify.

Further to this, AUSTRAC announced it is working on how it communicates with responsible entities and/or reporting entities.

Austrac improvements

According to Soros, AUSTRAC has taken on board the criticism that, as a regulator, it could do better with communication.

“I think there is real work for us to be doing when it comes to working with big reporting entities. Reporting entities sends us thousands—tens of thousands, hundreds and thousands—of Suspicious Matter Reports every year, and we could do better in providing feedback where there is over-reporting or under-reporting.”

Soros added that AUSTRAC would continue to engage with industry sectors and fill them in on rules and regulations.

While Soros did not address the recent compliance reports, Nile Jeans, from Arctic Intelligence—who spoke on the panel at the recent Refintiv event—penned a Linked in article addressing the fact that the regulator had already started to give feedback on annual compliance reports.

The annual AUSTRAC compliance report was a much-talked-about issue at the panel event, and in a recent GRC Professional Podcast interview with Andrew from Lawyers on Demand in the Asia Pacific and Consultant to Arctic Intelligence, he said compliance reports were a ‘ticking time bomb’ for those who may have incidents later on that don’t line up with the answers they were meant to give by the end of March.

In the LinkedIn article, Jeans writes:

If a reporting entity, when reflecting on its responses to the recent annual compliance report, believes that the responses indicate areas where AML/CTF compliance could be improved, it is important to address them now.

Soros indicated that AUSTRAC are going to be using technology more effectively, especially since the regulation of 14,000 entities is a strain on their resources. This means getting closer to Realtime feedback.

When addressing the future policy landscape, Soros said there were few but also acknowledged that the list he highlighted in his presentation was not an exhaustive one:

  • The Government is looking making cash payments over $10,000 illegal;

  • Coming up with trusted digital identity frameworks;

  • Streamlining the AML/CTF Act, based on the 2016 review; and

  • Working with new and emerging industry more closely.

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