Australian
financial intelligence agency AUSTRAC has called on digital currency exchanges
(DCEs) that are no longer operating to voluntarily withdraw their
registrations, warning that failure to do so could result in cancellation.
AUSTRAC Cracks Down on
Dormant Crypto Exchanges
DCEs,
including those operating cryptocurrency ATMs, must be registered with AUSTRAC
to legally offer services exchanging cash for cryptocurrency and vice versa.
Currently, 427 DCEs are registered, but the agency has expressed concern that a
significant number appear inactive. AUSTRAC has begun contacting businesses it
believes are no longer trading.
Brendan
Thomas, AUSTRAC’s chief executive, said inactive registrations could be
exploited by criminals seeking to use dormant businesses for illicit
activities. “Businesses registered with AUSTRAC are required to keep their
details up to date; this includes details about services that are no longer
provided,” Thomas said.
He added
that maintaining an accurate register is essential for protecting consumer
confidence and ensuring that only legitimate businesses operate in the sector.
“Our
intelligence shows cryptocurrency can be exploited by criminals for money
laundering, scams and money mule activities, and we’re seeing far too many
people falling victim to scams involving digital currency,” Thomas stated.
Use It or Lose It
AUSTRAC has
the authority to cancel a registration if it determines a business is no longer
providing DCE services. Cancellations are published on the agency’s website.
Thomas noted that if a business intends to resume operations, it may reapply
for registration at any time.
Following
its review, AUSTRAC plans to launch a publicly searchable register, allowing
consumers to verify whether a digital currency exchange is registered and under
regulatory oversight.
“We want to
make sure the public isn’t misled about the services a business is legally
allowed to provide,” Thomas said. “Members of the public should feel confident
that they can identify legitimate cryptocurrency providers that are registered
and subject to regulatory oversight and that we are driving criminals out of
this industry.”
Crypto Focus
In
February, AUSTRAC announced that it had taken action against
13 remittance and digital currency exchange providers and was investigating
more than 50 additional firms.
The
regulator, which is tasked with detecting, preventing, and disrupting criminal
activity within the financial system, intervened after these platforms failed
to adequately report suspicious transactions.
The current
enforcement efforts reflect
decisions made late last year, when AUSTRAC prioritized cracking down on
cryptocurrency ATMs for 2024. The agency had flagged cryptocurrencies as posing
increased risks for money laundering, scams, and money mule operations.
This article was written by Damian Chmiel at www.financemagnates.com.
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