Money laundering and terrorism financing present serious risks for Australians and Australia's financial system. The Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (AML/CTF Act) creates a regime which assists in detecting and preventing these and other significant crimes.
Important role of business in combating money laundering and terrorism financing
The AML/CTF Act employs a risk-based approach. It is designed to ensure relevant businesses, known as reporting entities, manage and minimise the risk of their services and products being used to launder money or facilitate the financing of terrorism. The Act works on the premise that individual businesses are best placed to know their services and products, as well as manage and minimise any risks posed by those services and products. Businesses covered by the Act include banks, non-bank financial services, remittance (money transfer) services, the gambling sector, bullion dealers and other businesses that provide particular services (known as 'designated services').
Customer identification processes
Under the AML/CTF Act, businesses which provide designated services have a number of obligations aimed at reducing money laundering and terrorism financing risk. These obligations include collecting and verifying information about a customer's identity when providing those services.
The type of information you could be asked to provide to verify your identity may vary according to the different transactions or services offered by the business. For example, you could be asked to provide information when opening an account, obtaining a loan or withdrawing superannuation benefits.
The systems and processes each business uses to collect and verify customer identification information are a matter for the individual business. Under the AML/CTF Act, each business is able to determine the sort of customer identification information it considers necessary to reduce the risk that its services and products might be used to launder money or finance terrorism and the methods it uses to collect it.
In the past, some businesses were required to perform what was known as the '100 point check' using particular forms. The '100 point check' is no longer a mandatory requirement for businesses. Use of the '100 point check' is a matter of choice by each individual business.
Questions about the customer identification process or forms used by a business should be directed to the individual business. AUSTRAC is unable to assist customers to complete whatever processes a business might have in place to collect and verify customer identification information. This includes assistance with S201 and S21 forms.
Confidentiality of information
Businesses captured under the AML/CTF Act are also required to comply with the Privacy Act 1988 when dealing with personal information gathered for the purposes of compliance with AML/CTF Act obligations.
The security and confidentiality protections a business offers its customers are a matter for each business to determine. Contact each business directly for further information on its procedures and processes.
More information about customer identification can be found on the website of the Attorney-General's Department.