AUSTRAC orders Binance to appoint auditor amid ‘serious concerns’
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The news: The Australian Transaction Reports and Analysis Centre (AUSTRAC) has ordered Binance Australia to appoint an external auditor after identifying “serious concerns” with the crypto exchange’s anti-money laundering and counter terrorism financing (AML/CTF) controls.
The news: The Australian Transaction Reports and Analysis Centre (AUSTRAC) has ordered Binance Australia to appoint an external auditor after identifying “serious concerns” with the crypto exchange’s anti-money laundering and counter terrorism financing (AML/CTF) controls.
The context: AUSTRAC’s concerns were prompted by issues with Binance’s latest independent review, which the financial crime watchdog considered “was limited in scope relative to its size, business offerings and risks”.
AUSTRAC 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”.
Increasing scrutiny of digital currencies is among AUSTRAC’s regulatory priorities for FY26, with the increasing vulnerability of digital currencies to criminal abuse also highlighted in AUSTRAC’s national risk assessment 2024.
Investbybit, Binance Global’s Australian arm, has 28 days to nominate external auditors for AUSTRAC to consider and select. It is registered with AUSTRAC as a digital currency exchange provider.
Binance is currently the world’s largest centralised crypto exchange by transaction volume and has regulatory approval or permissions to operate in around 20 jurisdictions.
AUSTRAC CEO Brendan Thomas said that “understanding specific risks of criminality in the Australian context is crucial to ensure they’re meeting their reporting obligations here”.
What they said: “Big global operators may appear well resourced and positioned to meet complex regulatory requirements, but if they don’t understand local money laundering and terrorism financing risks, they are failing to meet their AML/CTF obligations in Australia,” Thomas said.
“Businesses can have systems and processes that apply to multiple jurisdictions – but they need to reflect local regulatory requirements. The systems must adapt to the regulatory requirements, not the other way around.”
A Binance Australia spokesperson said they acknowledged the "supervisory review measure" and said the company is committed to "further building and expanding" its local compliance and operations capabilities "to ensure robust governance".
"We have engaged openly and transparently with AUSTRAC over the past several months and continue to value their guidance, expertise, and oversight," the spokesperson said.
The sources: AUSTRAC media release, Binance Australia statement
