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AUSTRAC collaborates on risks in super sector

The first ever risk assessment of money laundering and terrorism financing (ML/TF) in Australia’s superannuation sector has identified significant risks of fraud and cybercrime in the super sector and assessed the overall risk of ML/TF activity as “medium”.

Paul Jevtovic, the CEO of AUSTRAC, Australia’s financial intelligence agency, said the risk assessment is the result of unprecedented collaboration with superannuation funds, administrators, industry associations and advisers.

“I commend the willingness of the sector to work with AUSTRAC on this initiative,” Mr Jevtovic said. 

“I encourage the industry to use the report to evaluate and improve their anti-money laundering and counter terrorism financing (AML/CTF) systems and controls to ensure their business is protected against criminal misuse.

“Critically, the information in the risk assessment should empower the superannuation sector to identify and submit increased volumes of suspicious matter reports (SMRs) to AUSTRAC.”

In the two-year sample period, 19 SMRs (six per cent) related to potential terrorism financing. These reports were submitted by nine superannuation funds, in relation to amounts worth $259,790 in total.

“AUSTRAC will continue to monitor SMR trends in the sector to see if reporting levels increase,” Mr Jevtovic said.

“This information will inform AUSTRAC’s future intelligence-led compliance activities. We will also be monitoring how reporting entities in the sector have responded to the information in this risk assessment.

“As with all regulated sectors, AUSTRAC will seek to engage funds that appear to have lower levels of compliance than their industry peers.

“AUSTRAC will also develop additional industry specific guidance for the superannuation sector on how to effectively implement their obligations under the AML/CTF regime. We look forward to continuing our work with the super sector to prevent criminal abuse in the financial system.”

This assessment—written specifically for APRA-regulated superannuation funds—is the first in a planned series of sector-based ML/TF risk assessments being undertaken by AUSTRAC.

This risk assessment was recently announced by the Minister for Justice, Michael Keenan

The full risk assessment is available on the AUSTRAC website

 

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Last modified: 22/11/2016 15:09