AUSTRAC AND CASH IN TRANIST BUSINESSES By Joy Geary, AML Master Have you had a letter or a visit from AUSTRAC yet? If your answer is NO, then unless you are lucky, yours is just around the corner. Australia introduced new anti money laundering laws (AML Laws) for cash in transit dealers in December 2006.These laws have been fully operational since December 2008 and transition and amnesty periods have now expired. AUSTRAC is the regulator of these AML laws and has been focusing on cash in transit businesses for the last six or more months. Why is cash in transit covered by the new laws? The new laws apply to nearly every business that provides financial services. Cash in transit is captured because it involves the movement of cash. Cash can be generated through criminal activity making it “dirty money” or the proceeds of crime. Criminals want to distance themselves from dirty money through the money laundering process until the money seems cleansed of its connection with the original crime. The typical laundering process is to deposit dirty cash into the banking system and then move it around sufficiently within the system until its tracks are well covered and it is safe to re-integrate the money into the criminal’s environment either to invest in further criminal activities or as a source of wealth or to fund lifestyle pursuits. Cash in transit dealers are useful to criminals depositing dirty cash in banks because they add an air of legitimacy to the deposit and allow the criminals to remain unseen by bank staff. Cash in transit dealers may also be involved in moving money between criminals with the dirty cash staying outside the financial system. What do I have to do and when by? Key dates for compliance are well past which means those that are not compliant are in breach of these laws. The new laws are simple in theory but hard in practice for smaller businesses to implement. Although the legislation is
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Consultant: Joy Geary
over 280 pages long, and the current rules weigh in at around 140 pages, the key pages that a cash in transit dealer has to understand are less than 100.The challenge is to find the right 100 pages and understand them. All new customers that a cash in transit dealer takes on after 12 December 2007 must be subject to a customer identification procedure (the replacement for the 100 point check) which must meet minimum requirements set out in the AML/CTF Rules.This applies to companies, trusts, government departments and partnerships, to name the main customer types that cash in transit dealers would have. Cash in transit dealers also must have had an AML/CTF Program in place from 12 December 2007 which dealt with oversight by management or the owners, approval of the program by management or owners, training for staff, appointment of an AML/CTF Compliance Officer, probity checks for new staff.There are some other requirements that the AML/CTF Program must meet as well. All transactions after 12 December 2008 needed to be monitored for suspicious activity. Reports have to be lodged with AUSTRAC in respect of that activity. Since 13 December 2008, all cash moved of a value equal to or
BREAKING NEWS AUSTRAC plans to charge each cash in transit business a flat annual fee of $500 plus $1.06 for each transaction reported of more than $10,000. These charges were announced in the recent Budget and AUSTRAC plans to consult with industry between now and August. Deliveries of more than $10,000 to banks will incur two fees, one by the cash in transit business and one by the bank. Now is the time to lobby hard against these changes.
greater than $10,000 must be reported to AUSTRAC within ten business days of the transaction.This cash reporting was also required under the Financial Transactions Reporting Act (the predecessor legislation) although here were exemptions available. Compliance reports have been due by 31 March in the years 2008, 2009 and now 2010. AUSTRAC uses these to monitor your compliance.
Published on Jun 12, 2010
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