Learn what a bullion dealer is and what designated services they provide that could lead to obligations.
Bullion dealers are businesses that buy or sell bullion. This may include:
- precious metal traders
- refiners
- jewellers
- coin dealers
- pawn brokers.
Designated services for bullion dealers
You’re providing a designated service if you:
- buy and sell bullion while carrying on a bullion-dealing business
- buy bullion from a non-retail customer (a bullion wholesaler).
This means you have obligations under the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (the Act).
The customer doesn’t need to take physical possession of the bullion when you buy or sell it. This may happen when you hold the bullion in storage for the customer, or when the customer buys into ‘pools’ managed by you.
If you’re buying or selling bullion in a private capacity, this isn’t a designated service.
Definition of bullion
Bullion includes gold, silver, platinum or palladium that’s authenticated to a specified quality and fineness, and valued according to the market (spot) price of the contained precious metal.
Bullion can be in the form of:
- bars
- ingots
- plates
- wafers or other similar mass form
- coins.
Bullion coins
Coins traded at their bullion value are considered bullion, regardless of whether they bear an explicit mark indicating fineness (for example, gold sovereigns and Krugerrands that are traded at their bullion value).
Coins that aren’t traded at their bullion value, such as collector, proof or other coins that are valued on other factors, may still be regulated as precious metals if they contain certain precious metals.
Initial customer due diligence exemption for bullion dealers
You don’t need to conduct initial customer due diligence on a customer if both:
- the retail value of the bullion you’re buying or selling is less than $5,000
- you’re not required to conduct enhanced customer due diligence.
If you’re required to conduct enhanced customer due diligence, you must conduct initial CDD regardless of the value of the bullion.
Indicators of suspicious activity
Our indicators of potential suspicious activities can help you identify a potential ML/TF activity.
If you suspect on reasonable grounds that a customer or transaction is linked to a crime or a reporting obligation, you must submit a suspicious matter report.
You must also conduct enhanced customer due diligence if you propose to continue providing designated services to the customer.
Related legislation
- Section 5 of the AML/CTF Act - Definitions
- Table 2 of section 6 of the AML/CTF Act – Designated services
- Section 39E of the AML/CTF Act – Exemptions – specified conditions
- Section 41 – Reports of suspicious matters
This guidance sets out how we interpret certain Australian legislation, along with associated Rules and regulations. Australian courts are ultimately responsible for interpreting these laws and determining if any provisions of these laws are contravened.
The examples and scenarios in this guidance are meant to help explain our interpretation of these laws. They’re not exhaustive or meant to cover every possible scenario.
This guidance provides general information and isn't a substitute for legal advice. This guidance avoids legal language wherever possible and it might include generalisations about the application of the law. Some provisions of the law referred to have exceptions or important qualifications. In most cases your particular circumstances must be taken into account when determining how the law applies to you.