Anti-Money Laundering /Counter-Terrorism Financing (AML/CTF)
The key objectives of the AML/ CTF Act 2006 are :
- To detect, deter and disrupt money laundering, the financing of terrorism, and other serious financial crimes
- To provide information to relevant bodies to investigate and prosecute
- To fulfil Australia’s international obligations to combat money laundering.
Key terms
Money Laundering (ML): Turning the proceeds of crime into funds or assets that seem legitimate.
Terrorism Financing (TF): Providing financial support to terrorists or terrorist organisations.
Designated Service: A service that is listed in section 6 of the AML/CTF Act, 2006.
Reporting Entity: An entity that provides any designated services listed under section 6 of the AML/CTF Act, 2006.
AML/CTF Amendment bill
The Anti-Money Laundering and Counter-Terrorism Financing Amendment (AML/CTF) Bill 2024 was passed in Parliament on 29 November 2024. The reforms to the existing AML/CTF act were driven by the need to:
- Expand Australia’s AML/CTF regime to 80000+ tranche two entities a.k.a. Professional Service Providers (PSPs) – Lawyers, accountants, real estate professionals, dealers in precious stones and metals, trust and company service providers* (*e.g. services for company formation, management, nominee, legal entity address)
- Simplify, clarify and modernise the AML/CTF regime for businesses to comply
- Modernise on account of changing business structures, technologies, and illicit financing methodologies
Impact on Reporting Entities
Existing
- Streamlining Part A and B of the AML/CTF Program
- Include specific internal controls as part of the AML/CTF Program
- Cost of periodic ML/TF risk assessment and independent review of AML/CTF Program
New
- PSPs may require professional assistance in understanding and complying with complex AML/CTF Laws
- The total impact cost to the PSPs industry over a ten year period is to the tune of $13.9 billion
Certain key impact areas and timelines reporting entities need to be aware of
Business Group
If you are part of a designated business group (DBG) this will change into a reporting group concept.
Overseas Branch
If you are an reporting entity operating overseas through a foreign branch or foreign subsidiary of an Australian reporting entity then there is impact.
Transfer of value and international value transfer services
- Electronic funds transfer instructions, designated remittance arrangements and international funds transfer instructions (IFTI)
- Streamlining of value chain transfer concept
Customer Due diligence (CDD)
- Initial and ongoing CDD
- Application of enhanced CDD
- Circumstances for simplified CDD
Tipping off offence provisions
Flexibility to share information for legitimate purposes including within reporting groups to manage risk and prevent further crime.
Compliance officer
This has to be a fit and proper person resident in Australia and meet requirements specified in the rules
AML SecurCheck
AML SureCheck™ is an Australian Company who are specialists in helping businesses adhere to Anti-Money Laundering/Counter-Terrorism Financing (AML/CTF) regulatory compliance and obligations.
Founder and Director
Giridhar Kannan (Giri) is an expert in anti-financial crime, sanctions, fraud, and the controls and technology used to mitigate these risks. His extensive and practical experience of more than 20 years in implementing compliance programs and assessing company compliance with regulatory and industry standards was gained from his previous role as a first-line regulator and as a financial crime internal auditor with Westpac Group providing trusted advisory through testing of their AML/CTF controls, processes and systems during and after AUSTRAC enforcement action.
Giri holds a Ph.D. in Management and is as an adjunct faculty at the University of Sydney, Business School where he tutors International Financial Crime as a subject to post graduate students. He is a member of the Association of Certified Anti-Money Laundering Specialists (ACAMS) and holds the Advanced ACAMS – AUDIT certification. Giri is also a member of the Australian Compliance Institute and the Institute of Internal Auditors – Australia (IIA-A). He holds the privilege of being the first author to publish a White Paper on AML/CTF Audit at IIA-A .
