AUSTRAC new guidelines aims to help fight digital currency cybercrimes

The Australian Transaction Reports and Analysis Centre (AUSTRAC) is determined to work with businesses to curtail financial crimes connected to digital assets. The financial compliance enforcement agency has released two new guidelines for businesses to protect themselves and their clients from cybercrime.

In a notice, AUSTRAC said that even as digital assets are getting more popular and valuable, their employment in criminal activities is also increasing. In 2020-21, 500 ransomware attacks were reported, marking a 15% increase from the previous fiscal year, the body found.

“Financial service providers need to be alert to the signs of criminal use of digital currencies, including their use in ransomware attacks,” AUSTRAC CEO Nicole Rose said.

One of the guidelines is targeted at helping businesses and financial institutions prevent the criminal abuse of digital currencies. The guide noted that illicit uses include activities such as tax evasion, money laundering, scams, and purchasing products on the darknet.

The guideline implored firms to be on the lookout for users who tried to obfuscate the trail of their digital assets transactions by using mixers, privacy assets, and decentralized finance (DeFi) platforms suspiciously.

The second guideline focuses on detecting and stopping ransomware payments. AUSTRAC outlined that several indicators can be used to identify a business or individual that was trying to pay ransomware to cyber-criminals. These include impatience over the speed of transactions and sudden large transaction requests.

The regulator’s advice

The regulator advises financial service providers to act cautiously if such behavior is identified. This is because businesses looking to pay ransomware may not always be willing to report it as they are looking to rapidly escape from the clutches of the criminals and get their business back running.

However, the guideline also warned that service providers should not be quick to de-bank businesses it considers to be posting suspicious transactions without first confirming a genuine case of ransomware payments or illicit use being made using digital currencies.

Key industry players in the country have welcomed AUSTRAC’s efforts. Steve Vallas, the CEO of Blockchain Australia, said the industry does not condone the use of digital currencies for criminal activities in Australia.

Moreover, AUSTRAC has been shaping Australia’s digital assets industry compliance with financial regulations. The body has registered over 250 exchanges to operate legitimately in the country.

Against the backdrop of AUSTRAC’s guidelines, the government of Australia is also planning to introduce more stringent regulations for the industry. According to a new information sheet published by the Australian Securities and Investment Commission (ASIC), financial influencers will be faced with many new restrictions on their activities.

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