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AUSTRAC proposes amendments to AML/CTF rules

On 14 July 2020, AUSTRAC, the Australian Government agency responsible for protecting the community from financial crime such as money laundering and terrorist financing (ML/TF), has released for public consultation proposed amendments to Chapter 46 of the AML/CTF rules.

Chapter 46 outlines rules related to “Applicable Customer Identification Procedures” (ACIP) and these proposed amendments aim to provide greater simplicity and flexibility to reporting entities when identifying customers.

The proposed amendments include two general conditions where a reporting entity can carry out the ACIP after providing a designated service (covered under section 33).

These proposed conditions will require a reporting entity to:

  1. Make a determination that carrying out the ACIP in respect of a customer after commencing to provide a designated service is essential to avoid interrupting the ordinary course of business; and
  2. Implement appropriate risk management procedures and controls to effectively manage the ML/TF risks associated with providing designated services to a customer that has not had the ACIP completed.

In addition to these two conditions, it is proposed that reporting entities will be allowed an additional special circumstance to carry out ACIP on its customers after an account has been opened, provided that no other transactions (excluding the initial account opening deposit) have been made.

The consultation period is open until 12th August 2020 and details of how to make a submission can be found on AUSTRAC’s website (click here)

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