AUSTRAC is cracking down on cryptocurrency ATM providers in Australia who don’t comply with the country’s anti-money laundering regime.

AUSTRAC intelligence shows cryptocurrency poses a heightened money laundering risk, and is increasingly being exploited for money laundering, scams and money mule activities.

An internal AUSTRAC cryptocurrency taskforce has been established to ensure digital currency exchanges (DCEs) that provide crypto ATM services meet minimum standards and have robust practices in place to identify and minimise the risk that their machines will be used to move money associated with scams, fraud or other proceeds of crime.

Under the Anti-Money Laundering and Counter-Terrorism Financing (AML/CTF) Act 2006, DCEs, including those providing crypto ATM facilities, have to register with AUSTRAC and are also required to:

• undertake transaction monitoring
• complete know your customer (KYC) information checks on customers
• report suspicious activity in suspicious matter reports (SMRs)
• submit threshold transaction reports (TTRs) for cash deposits and withdrawals of $10,000 or more.

AUSTRAC CEO Brendan Thomas said AUSTRAC will be tightening monitoring of crypto ATM providers, and warns that AUSTRAC will take action against operators who are flouting the rules.

“Cryptocurrency and crypto ATMs are attractive avenues for criminals looking to launder money, as they are widely accessible and make near-instant and irreversible transfers,” Mr Thomas said.

“We’re seeing too many Australians falling victim to scams carried out through cryptocurrency, and we’ve heard of some victims losing their life savings, which is just heart breaking.”

“As the use of cryptocurrency increases, so too will criminal exploitation, which is why this taskforce will work to eliminate non-compliant high risk operations.

“Cryptocurrency ATM providers need to ensure they are complying with their money laundering obligations and are reducing the risks of crime. If they’re ignoring those obligations they risk being subject to significant financial penalties and AUSTRAC won’t hesitate in taking action.

“This is the first step in AUSTRAC’s focus to reduce the criminal use of cryptocurrency in Australia. We will be focusing on this industry over the course of next year.”

Currently there are approximately 400 digital currency exchange providers registered with AUSTRAC. While only a small number of these DCEs operate crypto ATM, Australia has 1200 operating crypto ATMs, which is the third highest number globally.

AUSTRAC develops materials to support DCEs to identify financial crime risks, so they can target, monitor and report suspicious activity to AUSTRAC. Crypto ATM operators who don't comply with their AML/CTF obligations to know their customer, report suspicious activity and identify, manage and mitigate these risks, they could face enforcement action.

Members of the public who suspect fraud or scam activity when using a crypto ATM should report this directly to the police and to the National Anti-Scam Centre’s Scamwatch, or the Australian Cyber Security Centre’s ReportCyber. Scamwatch and ReportCyber provides information about how to recognise and avoid scams. Further information can also be found on the AUSTRAC website.

Further information about risks associated with cryptocurrency, including a case study example, can be found in the  AUSTRAC Money Laundering in Australia National Risk Assessment.

About AUSTRAC

AUSTRAC (the Australian Transaction Reports and Analysis Centre) is the Australian Government agency responsible for detecting, deterring and disrupting criminal abuse of the financial system to protect the community from serious and organised crime.

Through intelligence led regulation, and enhanced intelligence capabilities, AUSTRAC collects and analyses reports and information to generate financial intelligence.

Learn more about AUSTRAC.

Media contact

Email: media@austrac.gov.au

Phone: 02 9950 0488