Binance Australia hit with AUSTRAC direction

Crypto exchange Binance Australia has been directed by AUSTRAC to appoint an external auditor after the regulator identified serious concerns with the company’s anti-money laundering and counter terrorism (AML/CTF) controls.

AUSTRAC said that Investbybit Pty Ltd, Binance Global’s Australian arm, is an AUSTRAC registered digital currency exchange.

AUSTRAC has also flagged concerns with high staff turnover at Binance and a lack of local resourcing and senior management oversight, raising questions about the adequacy of its AML/CTF governance.

AUSTRAC chief executive, Brendan Thomas said AUSTRAC expects tighter controls from major global operators, particularly in high risk sectors involved in large transaction volumes.

“This is a global company operating across borders in a high-risk environment. We expect robust customer identification, due diligence and effective transaction monitoring,” Thomas said.

“I remind all digital currency exchanges to remain alert to transactions that indicate suspicious behaviour, including money laundering via scams and cybercrime and terrorism financing – the potential for these activities are much higher for global exchanges.

“Capacity and risk controls need to correspond to the size of a business and its market presence, particularly as it scales.

“All digital currency operators need to ensure they are complying with Australian law and limiting their exposure to crime.”

Binance Australia has 28 days to nominate external auditors for AUSTRAC’s consideration and selection.