In brief
- Australian crypto exchange Cointree has been fined $75,120 by AUSTRAC for failing to submit suspicious matter reports on time.
- The exchange self-disclosed the reporting lapses and is taking steps to improve its internal compliance systems.
- AUSTRAC CEO Brendan Thomas highlighted the importance of timely reports in fighting financial crime and warned non-compliant entities face tougher enforcement.
The Lowdown on AUSTRAC's Actions Against Crypto Exchanges
The Arrival of AUSTRAC's "Hammer" - A Fine for Cointree
Cointree, an Australian Cryptocurrency Exchange, Penalized for Delayed Filing of Suspect Activity Reports
The Australian Transaction Reports and Analysis Centre (AUSTRAC) laid down the law on Melbourne-based crypto exchange Cointree, levying a fine of $75,120 for falling behind on submitting suspicious activity reports (SARs) within the required timeframes. AUSTRAC unleashed its enforcement hammer after Cointree voluntarily disclosed its shortcomings regarding anti-money laundering reporting obligations.
Serving the Community with SARs - A Timely Matter
SARs are mandatory filings that regulated entities submit when they think a transaction might be linked to criminal activities such as money laundering or terrorism financing. AUSTRAC has made it clear that timely submissions are crucial since the information gathered from these reports helps in identifying and addressing financial crimes more efficiently.
Entities need to report SARs within three business days of suspecting money laundering activities or within 24 hours for suspected terrorism financing.
Compliance No Walk in the Park - AUSTRAC Takes an Iron Fist Approach
CEO Brendan Thomas emphasized AUSTRAC's stern stance on the matter, stating, "Time is of the essence when dealing with these reports, which is why the tight deadlines are in place - they allow us to respond swiftly and inform our partners of suspected criminal activity." Thomas acknowledged Cointree's cooperation but warned that a more drastic response would have been in store if the exchange hadn't self-reported the issue and taken remedial action.
Fear and Compliance - A Chilling Message to Non-Compliant Entities
Thomas' stern message serves as a chilling reminder for non-compliant entities that they face increasingly aggressive enforcement measures. AUSTRAC's recent actions against crypto exchanges are just the tip of the iceberg, underscoring its commitment to strengthening oversight of Australia's digital currency exchange sector.
Australia's financial intelligence agency has taken aim at 13 crypto businesses for compliance failures, while an additional 50 entities have been warned about potential shortcomings. AUSTRAC's hardline stance irons out smoother paths for law enforcement agencies to trace and curb illicit transfers, contributing to a safer financial landscape for all Australians.
Cleaning Up the DCE ecosystem - A "Use It or Lose It" Approach
AUSTRAC is stepping up its efforts to weed out inactive digital currency exchanges (DCEs), urging them to either voluntarily withdraw their registrations or face cancellation. With roughly 427 DCEs registered in Australia, it's estimated that around 25% are inactive or dormant. The agency is focusing on preventing criminals from exploiting dormant registrations to launder cash or run scams.
The Daily Debrief Newsletter
Sebastian Sinclair, Editors
- In the world of digital currency, Cointree found itself on the wrong side of AUSTRAC's "Hammer," receiving a fine of $75,120 for late submission of suspicious matter reports.
- AUSTRAC's enforcement action against Cointree serves as a reminder about the importance of timely reporting of suspicious activities in the crypto market.
- With the rise of Initial Coin Offerings (ICOs) and digital assets, there's a growing need for effective crypto regulation to combat financial crimes like money laundering and terrorism financing.
- As AUSTRAC cracks down on non-compliant crypto exchanges, the general-news and crime-and-justice sectors are keeping a close eye on the situation, as it could have far-reaching implications for the global crypto market.
- For businesses involved in crypto exchange, the need for robust internal compliance systems is paramount to avoid facing tougher enforcement measures from regulatory institutions like AUSTRAC.
- The increasing scrutiny on the digital currency market is part of a broader effort to promote a safer, more stable, and transparent financial ecosystem—one that supports legitimate business activities while deterring illegitimate ones such as crime.
