Australian Regulator Cracks Down on Cryptocurrency Exchanges and Remittance Providers

The Australian Transaction Reports and Analysis Centre (AUSTRAC) has issued a stern warning to cryptocurrency exchanges and remittance providers to adhere to anti-money laundering laws, or face the consequences. The agency is currently reviewing over 50 providers and has recently taken action against 13 of them.

According to AUSTRAC CEO Brendan Thomas, the agency canceled, suspended, or refused to renew the registrations of nine providers late last year due to non-compliance with the Anti-Money Laundering and Counter-Terrorism Financing Act. Thomas stated:

A further 2 providers had conditions placed on their registrations and are now on notice – a failure to meet these conditions may lead to suspension or cancellation of their registrations.

Crackdown on Non-Compliant Providers

The latest crackdown follows a year-long investigation into companies that may have failed to disclose or underreported suspicious transactions. AUSTRAC has imposed restrictions on two providers’ registrations, stating that additional violations may result in termination.

Several executives from businesses, including Auaisa Trading Pty Ltd, Amco Travelling and Exchange Pty Ltd, and B-Paywize Pty Ltd, have been charged with crimes or are subject to legal action. Jinte Net Blockchain Pty Ltd and DIGI-SEND E-Money Pty Ltd were found to be operating businesses that no longer require registration.

Bankrupt Exchanges Removed from Register

Struggling exchanges FTX Express and Zipmex Australia have been taken off the Digital Currency Exchange Register after filing for bankruptcy.

Tips for Cryptocurrency Exchanges and Remittance Providers

To avoid non-compliance and potential penalties, cryptocurrency exchanges and remittance providers should:

  • Ensure compliance with the Anti-Money Laundering and Counter-Terrorism Financing Act
  • Disclose and report suspicious transactions accurately and promptly
  • Regularly review and update their anti-money laundering and counter-terrorism financing policies

Regulatory Oversight

AUSTRAC has pledged to keep a close eye on the 417 registered cryptocurrency exchanges in Australia that it presently regulates. The regulator has also issued compliance reminders to 106 companies since January, with the help of its crypto taskforce.

As Thomas warned, “Businesses working in this space who are not meeting their obligations can expect to hear from us.”

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