AUSTRAC warns of rising cryptocurrency money laundering risks, calls for tougher crackdown

AUSTRAC has issued a warning about increasing money laundering risks associated with cryptocurrencies in its latest report.

The 2024 National Risk Assessment highlights that digital currencies used for value transfer pose significant money laundering risks. This risk is expected to rise over time.

Digital currency exchanges and tokens used as a store of value are considered medium-risk, with predictions indicating a rise over the next three years.

AUSTRAC points out money laundering loopholes

AUSTRAC CEO Brendan Thomas emphasized that digital currencies help criminals move funds quickly and anonymously, increasing exploitation risks.

AUSTRAC also identifies luxury goods, casinos, cash-intensive businesses, and unregistered remittance dealers as other key money laundering vulnerabilities.

The report notes that money laundering remains a persistent issue globally, despite efforts by public and private sectors to combat it.

Countries take firm stance on anti-money laundering

The release of the AUSTRAC report coincides with growing international scrutiny over illicit digital asset use, with terrorist groups like Hamas reportedly seeking digital currency fundraising since 2019.

Blockchain analytics firm Chainalysis reports nearly $100 billion in laundered funds transferred from illicit wallets to conversion services since 2019.

U.S. Legislative Efforts

In the U.S., lawmakers, including Senator Elizabeth Warren, are pushing for stronger anti-money laundering measures to address the rising use of digital currencies by terrorist organizations.

AUSTRAC’s solution

AUSTRAC suggests ongoing investigations, asset confiscation, regulatory reform, capacity building, industry outreach, education, and strengthened partnerships as remedies for current money laundering challenges.

Australia remains dedicated to creating a hostile environment for criminal actors abusing the financial system for money laundering and other serious crimes.