Contact: Amanda Kennedy
Deloitte
Media and communications manager
+61 3 9208 7407

Contact: Chris Cass
Deloitte
Partner, Forensic
+61 2 9322 7060

The changes to reduce the level of prescription in the new anti-money laundering legislation release today and the move to a more risk based approach were welcomed according to Deloitte Forensic AML Partner, Chris Cass.

“The government has listened to industry and moved away from a one-size fits all approach,” Mr Cass said.

“Now organisations will be able to identify where their own potential risks lie and then decide how they are going to manage those risks.

“It is far less prescriptive but organisations should not view this risk based approach as a lesser challenge.

“With the flexibility of how to deal with risk comes more responsibility on each individual organisation to develop, implement and monitor their own risk management processes and controls.

“While the financial services industry should be pleased with the outcome of the revised legislation, it doesn’t mean a reduced compliance obligation.”

Mr Cass said there had been significant changes with regard to third parties working for organisations affected by the new legislation.

“All third parties will now have to comply with each organisation’s individual risk management program.

“So if you are an adviser providing information to someone on three different banks or financial institutions, it is possible you will have three different risk management processes to go through, even though you are only dealing with the one customer.

Mr Cass said that while the revised legislation will significantly improve Australia’s ability to detect and counter money laundering and terrorism financing, there still remain some issues raised by the Financial Action Task Force that have not been addressed, in particular with respect to customer identification programs.

“We would strongly urge anyone affected by this legislation to take stock and work out how it is going to affect their organisation as there are only three weeks left to provide comment to the Minister before this becomes law.”