Binance Australia Faces Scrutincy, AUSTRAC Mandates Audit

AUSTRAC Mandates External Audit for Binance Australia

Binance Australia is under increasing scrutiny from the country’s financial watchdog, Australian Transaction Reports and Analysis Centre. Citing “serious concerns” regarding its anti-money laundering (AML) and counter-terrorism financing (CTF) controls, the regulator has directed the exchange to appoint an external auditor. The platform has been given a 28-day deadline to submit nominations for external auditors, which will then be considered and selected by AUSTRAC.

Binance Australia To Appoint External Auditor

In an official statement, AUSTRAC ordered Binance Australia to conduct external audits, as the company has allegedly failed to comply with AML and CTF regulations.

Significantly, this move comes in response to the growing financial threats and crypto abuse in the country. The regulatory head, Brendan Thomas, asserted that the regulator is dedicated to collaborating with the cryptocurrency industry to implement robust safeguards that prevent criminals from exploiting virtual assets for illicit activities, such as money laundering and terrorism financing. He added,

“Big global operators may appear well resourced and positioned to meet complex regulatory requirements, but if they don’t understand local money laundering and terrorism financing risks, they are failing to meet their AML/CTF obligations in Australia.”

Interestingly, the latest move is part of the regulator’s wider crackdown on the crypto sector. The regulator has already taken action against 13 crypto exchanges and remittance providers for non-compliance. In addition, they are also now extending their scrutiny to over 50 more companies.

AUSTRAC Slams Limited Review Scope

Notably, the AUSTRAC CEO alleged that exchange’s latest independent review had a limited scope considering the company's size, services, and risk exposure. He emphasized that businesses should conduct thorough and rigorous reviews to ensure their controls are working effectively and manage risks properly. Thomas posited, “Businesses can have systems and processes that apply to multiple jurisdictions – but they need to reflect local regulatory requirements. The systems must adapt to the regulatory requirements, not the other way around.”

However, Binance remains steadfast in its commitment to adhering to regulatory requirements. Matt Poblocki, general manager of Binance Australia and New Zealand, noted,

“We have engaged openly and transparently with Austrac over the past several months and continue to value their guidance, expertise, and oversight. We remain committed to maintaining best-in-class compliance standards and will continuously enhance our capabilities.”