AUSTRAC Reg. A Must For Operating Crypto Exchanges In Australia
Starting today, only cryptocurrency exchanges registered with AUSTRAC (Australian Transaction Reports and Analysis Centre) will be allowed to conduct operations in Australia. On December 7, 2017, the Australian Senate passed an amendment to the Anti-money Laundering and Counter-Terrorism Financing Act 2006 AML/CIF Act, requiring compulsory registration of cryptocurrency exchanges.
The bill, introduced in Sentate in August 2017, empowers AUSTRAC to monitor and regulate cryptocurrency trading venues. Bitcoin and other cryptocurrency exchanges will have to adhere to the AML/KYC laws followed by banks and other financial institutions. All suspicious activity, cross-border transactions and large trades exceeding A$10,00 needs to be reported to AUSTRAC. The exchanges are also required to maintain records of transactions and customer identification for seven years.
The Anti-money Laundering and Counter-Terrorism Financing Amendment Bill 2017 was introduced to combat financial crimes, in the wake of revelations about breaches of money laundering laws by Commonwealth Bank. Two years before, FATF (Financial Action Task Force), global AML watchdog, had pointed out serious deficiencies in Australia’s AML framework. It is the first time a law related to digital assets has been passed in the Australian Senate. The bill will ensure that law enforcement agencies will treat crypto currencies in the same manner as other assets offered by banks and other financial institutions in Australia.
According to the new law, cryptocurrency exchanges will have to run an effective AML and counter-terror financing program. Penalties for non-compliance include a minimum fine of $105,000 and/or a minimum jail term of two years. For extremely severe crimes, the jail term can be even up to seven years, while the penalties can be as high as $2.10 million for corporations and $420,000 for individuals.
Commenting on the new rules for cryptocurrency exchanges, CoinTree said
“We see this as an important step toward building real confidence with the general public and investors that the cryptocurrency industry is not only safe but is supported as the way of the future. For new and existing customers, there will be no impact. CoinTree has always been proactive with its policies and practices. We are happy to say that we already meet a majority of the new requirements. For those requirements that aren’t quite completely met yet, the changes required are internal only and will not affect any customers.”