Australia is upping the stakes in its ongoing war against digital currency ATMs, as the country’s Home Affairs Minister Tony Burke announced new, stricter rules, while calling the machines a “high-risk product” linked to money laundering, scams, and child exploitation.
The new rules, announced on October 15, are part of broader new powers being introduced to combat money laundering, terrorism financing, and crime risks.
“Australia has the highest number of [crypto] ATMs in the region, and the third highest in the world,” said Burke, in an October 14 speech to the National Press Club in Canberra, as reported by local outlet ABC News. “Six years ago, Australia had 23 of them. Three years ago, Australia had 200 of them. Now, we have 2,000 of them. It’s grown and grown rapidly.”
This exponential increase over the past few years has raised concerns around “significant money laundering, terrorism financing and serious crime risks associated with crypto ATMs,” said Burke.
He added that “when they looked at the top users, the top users who are putting the most money into crypto ATMs, 85 per cent of the money going through for the top users involved scams or money mules.”
The Home Affairs Minister also pointed to the difficulty of tracing purchases of digital currency with cash as the reason digital currency ATMs have come under particular scrutiny from the Australian government and authorities.
With that in mind, he revealed that the country’s top financial crimes agency, the Australian Transaction Reports and Analysis Centre (AUSTRAC), will be getting new powers in upcoming legislation to target digital currency ATMs.
Burke did not elaborate on precisely what these new powers would entail, or whether they would include an outright ban on digital currency ATMs, but he did indicate that they would give AUSTRAC the authority to restrict or prohibit ‘high-risk products.’
“And be [in] no doubt crypto ATMs are a high risk product,” said Burke.
The Home Affairs Minister is expected to introduce the new legislation to Parliament in the coming months.
The announcement can be seen as the latest escalation in Australia’s ongoing fight against digital currency ATMs, which began with an AUSTRAC crackdown last December.
Edging out ATMs
Australia is among the world’s largest markets for digital currency ATMs. According to Coin ATM Radar, there are 2,012 digital currency ATMs in the country, with only Canada and the United States having more: 3,700 and 31,233, respectively.
This represents a substantial increase from the 23 digital currency ATMs that the country had in 2019, and 60 in 2022. Since then, the numbers have exploded, with machines available in malls, gas stations, and other convenient locations – Sydney alone now has 430.
This exponential growth brought the sector to the attention of AUSTRAC, which in December of last year launched a crackdown on digital currency ATM providers in Australia who didn’t comply with its anti-money laundering and countering the financing of terrorism (AML/CFT) regime.
“AUSTRAC intelligence shows cryptocurrency poses a heightened money laundering risk, and is increasingly being exploited for money laundering, scams and money mule activities,” said the agency.
Under Australia’s law, digital currency ATM operators should monitor all transactions, report any suspicious activities, complete Know Your Customer (KYC) checks on all users, and submit reports to AUSTRAC for cash transactions worth more than AUD10,000 (US$6,300). They must also have robust practices in place to identify and minimize the risk that their machines will be used to facilitate the movement of money associated with scams, fraud, or other illicit proceeds.
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In order to make sure these minimum standards were met, an “internal AUSTRAC cryptocurrency taskforce” was established to investigate and oversee the sector.
A few months after its founding, amid a surge in usage nationwide, the task force revealed that many ATM operators had been falling short of their regulatory obligations. This resulted in AUSTRAC officially putting digital currency ATM operators on notice over their lack of AML/CFT checks.
“We want to ensure crypto ATM providers have robust practices to minimise the risk that their machines can be used to launder dirty money or to scam and defraud innocent people,” said AUSTRAC CEO Brendan Thomas, when announcing the notice in March.
The agency backed up its words with more action in June, this time announcing it was imposing an AUD5,000 (US$3,250) limit on cash deposits and withdrawals on crypto ATMs, as well as scam warning signs, more robust transaction monitoring, and enhanced customer due diligence obligations.
“In light of the risks and harms we consider it is absolutely necessary to ensure the sector meets minimum standards and reduces the criminal misuse of crypto ATMs,” said Thomas, in a June 3 press release.
He added that the new conditions were “designed to help protect individuals from scams by deterring criminals from directing them to a crypto ATM, as well as to protect businesses from criminal exploitation.”
However, the AUSTRAC CEO said the new rules were not set in stone and indicated that the agency would “keep the effectiveness of these conditions under review, and adjust if needed.”
It now appears that the Australian government intends to support AUSTRAC’s efforts by granting the agency additional powers to continue the fight against the booming digital currency ATM sector, which has continued its steady growth in the country despite the crackdown and the crime it reportedly facilitates.
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Watch: The Harsh Truth About Crypto and National Debt
Source: https://coingeek.com/australia-doubles-down-in-ongoing-campaign-against-crypto-atms/
