AUSTRAC Urged Banks Not to Cut Off Remittance Companies

The head of the Australian Transaction Reports and Analysis Centre (AUSTRAC) has urged banks to not cut off remittance companies because of a fear of involvement in terrorism financing. AUSTRAC Chief Executive Paul Jevtovic held that he did not want to see the remittance industry “driven underground.”   In a report released on April 21, 2015 by the Paris-based Financial Action Task Force (FATF), AUSTRAC was criticized for “not putting enough focus” on ensuring that banks and other financial establishments were complying with anti-money laundering and counter-terrorism finance rules. FATF sets the global standards in the war against terrorism financing and money laundering.   Jevtovic deemed the report “tough,” but he welcomed the opportunity to enhance the agency. He pointed out that dealing with the remittance sector was a “vexed and complex issue.” However, he emphasised its importance, remarking that the industry “good work providing services to people who would otherwise not be able to move money internationally.”   Jevotic admitted that the remittance sector was vulnerable to compromise by “unscrupulous people, organised crime and terrorist financing groups.” But he added that the agency would work closely with the remitters to ensure that they are as “target-hardened” against being compromised to the best extent possible.   Last year saw the closure of Bisotel Rieh, a Sydney-based money remittance company that is owned by the sister of Islamic State terrorist Khaled Sharrouf. AUSTRAC shut down the business after it failed to explain transfers to the Middle East, which were worth millions of dollars.   Currently, there is a widespread concern in Australia’s remittance industry that the big banks’ move to cut off the remittance sector is having the “perverse effect” of making it harder to detect terrorists’ movements.       References: http://www.theaustralian.com.au/business/financial-services/austrac-tells-banks-not-to-cut-off-money-remitters/story-fn91wd6x-1227315993621
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