On 6 September 2021, AUSTRAC put the major Australian banks on notice through its money laundering (ML) and terrorism financing (TF) Risk Assessment1 that the sector is high risk for money laundering (ML) and terrorism financing (TF). This will be AUSTRAC’s official position going forward and a major Australian bank will be hard pressed to argue otherwise unless substantiated by reliable data and a well-evidenced rationale. AUSTRAC also noted that it is particularly concerned about the low level of governance and assurance around AML/CTF compliance and inconsistency in the application of risk mitigation strategies among the major banks.2
In this short article, we explore some of the questions Board members and senior management of major banks may wish to consider following AUSTRAC’s ML/TF Risk assessments and its underlying concerns. Resolving such questions may assist Boards and senior management in ensuring that ML/TF risks specific to their organisations are properly identified and understood, including how and where in the business the ML/TF risk arises, and what measures are in place to manage the particular ML/TF risk.
The pressure to tackle financial crime has never been greater. Deloitte’s global financial crime practice is at the forefront of the fight against financial crime and has assisted many of the world’s leading financial institutions in developing, implementing and remediating all aspects of financial crime risk management programs, as well as investigating financial crimes.
Our Australian team works extensively with organisations in understanding, documenting and acting on ML/TF risk. We have advised boards and senior management on AML/CTF over a number of years, and in response to a significant regulatory events and enquiries.
1AUSTRAC, 6 September 2021, “Money Laundering and Terrorism Financing Risk Assessment: Major Banks”:
2 Ibid, page 7.
3 Ibid, pages 62-63.
4 See Part 8.7 and Part 9.7 of the AML/CTF Rules