Blockchain
Australia’s AUSTRAC warns of growing role of cryptocurrencies in illicit activities
Australia’s financial watchdog has expressed concern over the increased use of digital currency to facilitate illicit transactions.
According to the Australian Transaction Reports and Analysis Centre’s 2024 National Money Laundering Risk Assessment (AUSTRIAN), a financial intelligence agency, the country has seen a rise in criminal use of cryptocurrencies and cryptocurrency exchanges. The report labeled cryptocurrencies as a “high” risk factor.
Meanwhile, digital currency exchanges have been assigned a “medium” risk rating.
Interestingly, most of the illicit activities were facilitated by traditional channels such as cash, real estate and luxury goods. These were given the “very high risk” status, with cash leading the way.
Similar sentiments were recently echoed by Jim Lee, former head of criminal investigations for the U.S. Internal Revenue Service, during an appearance on an episode of Yahoo Finance Future Focus. According to Lee, “cash is still king” due to the “transparent” nature of blockchain technology.
While AUSTRAC has classified cryptocurrencies as less risky, the report has urged cryptocurrency exchanges to register with the agency under the AML/CTF Act. AUSTRAC predicts that the use of digital currency in illicit activities will pose a high risk over the “next three years.”
“As the use of digital currency expands for legitimate purposes, the opportunities for criminal use will also increase,” the report added.
Furthermore, the agency called for international collaboration and stringent regulations to effectively combat these problems.
Australia has seen multiple crypto crimes in the first half of 2024 alone. In June, the YouTube channel for Australian broadcaster 7News has been hacked to promote a crypto scam starring a deep-fake Elon Musk. Prior to that, security firm Cybertrace issued a warning warning of a cryptocurrency scam involving Australian mining magnate and entrepreneur Andrew “Twiggy”.
The AUSTRAC assessment follows a Ban on the use of cryptocurrencies as a payment method for online gambling in Australia.
In an attempt to strengthen its grip on the cryptocurrency sector, the Australian Tax Office has also been targeting cryptocurrency inventors seeking their personal information and details from cryptocurrency exchanges. The Australian Securities and Investments Commission (ASIC) has also been stalk cryptographic entities which it believes have offered unregistered securities.