AUSTRAC has found the risk of money laundering and terrorism financing in the non-profit sector remains stable, with criminals continuing to exploit charities to move illicit funds in Australia and overseas.
The updated Terrorism financing risks in Australia’s non-profit organisation sector evaluates terrorism financing risks in the NPO sector and provides new guidance on how to better detect and prevent terrorism financing within the sector.
The update includes suspicious activity indicators to help regulated businesses identify behaviours that may signal potential money laundering or terrorism financing involving NPOs.
AUSTRAC Deputy CEO Intelligence, Dr Alexandra Caples, said the sector plays a critical role supporting communities, and while the risk of criminal exploitation remains low and concentrated, the threat has not gone away.
“Charities and NPOs do amazing work in the community and supporting people in conflict zones overseas, but unfortunately the sector is also at risk of being used to fund terrorism in a small number of cases,” Dr Caples said.
“Our work shows that while this risk remains stable and limited to a small cohort, NPOs are still vulnerable to terrorism financing and must remain alert.”
“The update aims to assist businesses to ensure their AML/CTF systems and controls are robust and effective so they can detect suspicious activity relating to NPOs.
“All regulated businesses working with NPOs and charities, must understand the risks they face in relation to money laundering and terrorism financing and ensure they have proportionate, risk-based systems and policies in place to prevent criminal misuse,” Dr Caples said.
“It’s vital that AUSTRAC, reporting businesses, and the NPO sector continue working together to keep the sector safe from criminal abuse and terrorism financing misuse.
“This update will assist our reporting entities like banks, remitters and foreign exchange providers to assess their level of vulnerability, strengthen their controls, and report suspicious activity to AUSTRAC.”