This series of money laundering and terrorism financing risk assessments represent important collaborative undertakings between AUSTRAC and our domestic and international partners within industry and government.
There are three main types of risk assessments included on this page:
- sector- and product-based assessments which are heavily tailored to the needs of industry sectors with obligations under the AML/CTF Act. These are intended as a resource for reporting entities to improve and refine ML/TF risk assessments and internal controls, and to meet their reporting obligations, particularly the requirement to submit suspicious matter reports to AUSTRAC.
- risk assessments concerning broader money laundering and terrorism financing risks in Australia
- risk assessments conducted in partnership with regional partners.
Each risk assessment provides an overall risk rating, based on an assessment of the criminal and terrorist threat environment, vulnerabilities to ML/TF and the associated consequences of misuse.
This regional risk assessment was coordinated by AUSTRAC, Bank Negara Malaysia and Indonesia’s financial intelligence unit Pusat Pelaporan dan Analisis Transaksi Keuangan (PPATK). It examines terrorism financing (TF) risks facing non-profit organisations (NPOs) in Australia, New Zealand and South-East Asian countries. This assessment aims to enhance the capacity of the countries involved to understand and develop responses to better mitigate NPO risks, while also deepening the intelligence picture of regional TF risk. It is also a critical step for countries in meeting international standards to identify their subset of high-risk NPOs.
AUSTRAC assessed the overall ML/TF risks associated with remittances sent through remittance providers from Australia to Pacific Island countries as low. This was based on the low level of criminality associated with these remittances and the generally low value of remittances being sent to support family and communities in the Pacific. This risk assessment was produced in collaboration with the Department of Foreign Affairs and Trade, to support broader Australian Government commitments to the G20 around financial inclusion, including commitments to drive down the cost of remittances to the Pacific.
In 2017, AUSTRAC and the Australian Charities and Not-for-profits Commission (ACNC) released a joint report which assesses money laundering and terrorism financing risks affecting Australian non-profit organisations (NPOs). This report identifies the main criminal, money laundering and terrorism financing threats currently facing NPOs. It highlights key vulnerabilities that are exploited for criminal misuse, or to support or promote terrorism and its financing. It also addresses an international requirement to identify the subset of NPOs at high-risk of terrorism financing misuse.
The overall ML/TF risk for the securities and derivatives sector is assessed as medium. Australia’s securities and derivatives sector attracts a wide range of criminal threats that often involve sophisticated tactics and methods. Serious and organised crime groups have exploited the sector to launder money and engage in market manipulation. The most common crime type reported in the sector is fraud; with money laundering, insider trading and market manipulation also posing risk.
AUSTRAC assessed the overall ML/TF risk associated with the use of stored value cards (SVCs) to be medium, and their vulnerability to criminal misuse to be high. The report found that the risk level of individual SVCs varies significantly depending on the features of the specific product. Travel cards that can be reloaded and redeemed offshore in cash carry significantly higher levels of risk than low value retail gift cards. The most common crime-types in which SVCs are implicated are money laundering and cyber-enabled fraud. Of particular concern is the use of SVCs for terrorism financing purposes.
AUSTRAC assessed the overall risk of ML/TF activity as medium. The report found that as financial planners facilitate access to financial services for their customers, this can make them susceptible to exploitation for criminal purposes. It also means planners are well-placed to detect suspicious behaviour by their customers. The report encourages the financial planning sector as a whole to ensure that AML/CTF compliance is a greater part of the organisational culture.
AUSTRAC identified higher than anticipated risks of fraud, cybercrime and terrorism financing in the superannuation sector, and has assessed the overall risk of ML/TF activity as medium. This report aims to develop awareness in the sector of these risks and help harden APRA-regulated superannuation funds against criminal activity.
In 2016, AUSTRAC and its Indonesian counterpart, Pusat Pelaporan dan Analisis Transaksi Keuangan (PPATK), co-led the research and development of this regional risk assessment on terrorism financing, with contributions from the FIUs of Malaysia, the Philippines, Singapore and Thailand. The assessment focuses on the terrorism financing methods and channels presenting the highest risks, as well as those forecast to pose increasing risks over the medium term. The assessment also identifies priority areas where regional efforts could be focused to strengthen counter-terrorism financing capability and better mitigate terrorism financing risk.