Australia’s financial regulator has expressed concern over the surge in the use of digital currency to facilitate illicit transactions.
According to the 2024 National Money Laundering Risk Assessment by the Australian Transaction Reports and Analysis Centre (AUSTRAC), a financial intelligence agency, the country has seen a rise in the criminal use of cryptocurrencies and crypto exchanges. the report Cryptocurrencies are rated as having a high “risk” factor.
Meanwhile, cryptocurrency exchanges received a “medium” risk factor.
Interestingly, most of the illicit activity was facilitated through traditional channels such as cash, real estate and luxury goods. These goods were classified as “very high risk,” with cash being at the forefront of these channels.
Jim Lee, former head of the IRS’s criminal investigations division, recently expressed similar sentiments while appearing on an episode of Yahoo Finance’s Future Focus. According to Lee, “cash is still king” due to the “transparent” nature of blockchain technology.
While the Australian Anti-Money Laundering and Counter-Terrorism Financing Agency (AML/CFTA) has classified cryptocurrencies as low risk, the report urges cryptocurrency exchanges to register with the agency under the Anti-Money Laundering and Counter-Terrorism Financing Act. AML/CFTA expects the use of digital currencies for illicit activities to pose a high risk over the “next three years.”
“As the use of digital currency for legitimate purposes expands, the opportunities for criminal use will also increase,” the report added.
The agency called for international cooperation and strict regulations to effectively combat these issues.
Australia has seen multiple cryptocurrency-related crimes in the first half of 2024 alone. In June, Australia’s YouTube channel 7News was hacked to promote a cryptocurrency scam featuring a fake Elon Musk. Prior to that, security firm Cybertrace issued a warning about a cryptocurrency scam featuring Australian mining mogul and entrepreneur Andrew “Twiggy.”
AUSTRAC’s assessment comes on the heels of a ban on the use of cryptocurrencies as a payment method for online gambling in Australia.
In an attempt to tighten its grip on the crypto sector, the Australian tax authority has also targeted crypto inventors seeking their personal information and details from crypto exchanges. The Australian Securities and Investments Commission (ASIC) has also been pursuing crypto entities it believes have offered unregistered securities.
