New correspondent banking obligations take effect
11 June 2007
Tomorrow marks an important milestone in the implementation of Australia's anti-money laundering legislation when correspondent banking obligations come into effect under the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (AML/CTF Act).
From 12 June 2007, before a financial institution provides banking services to a financial institution located in another country it must carry out a preliminary assessment of the risk that the relationship may involve money laundering or the financing of terrorism.
It may then be necessary for the financial institution to carry out further investigations before entering into the correspondent banking relationship.
Civil penalties apply for breaches of these new correspondent banking provisions.
The AML/CTF Act was introduced in December 2006 to meet revised international standards in the fight against money laundering and the financing of terrorism. The Act is administered by the Australian Transaction Reports and Analysis Centre (AUSTRAC), Australia's anti-money laundering and counter-terrorism financing regulator and specialist financial intelligence unit. The Act is being implemented over a two-year period.
AUSTRAC Chief Executive Officer Neil Jensen said the implementation of the correspondent banking obligations was another important step in creating an environment that is hostile to money laundering and terrorism financing.
Tomorrow's obligations mark the second key date in the staggered implementation timetable and affect banks and other financial institutions.
Media enquiries only: Kim Hargest on 03 8636 0553 or 0418 103 107
General enquiries: AUSTRAC's Help Desk on 1300 021 037