Sydney (AFP) – Australia has ordered the local arm of the world’s largest cryptocurrency exchange, Binance, to appoint an external auditor after identifying “serious concerns” with its money laundering and terrorism financing controls. The Australian Transaction Reports and Analysis Centre (AUSTRAC), the country’s financial intelligence agency, said Friday its concerns followed Binance Australia’s latest independent review which was “limited in scope relative to its size, business offerings and risks”.
AUSTRAC also flagged the company’s high staff turnover, lack of local resourcing, and senior management oversight, the agency said in a statement. “AUSTRAC has directed Binance Australia to appoint an external auditor after identifying serious concerns with the crypto exchange’s anti-money laundering and counter terrorism financing controls,” it said. AUSTRAC’s chief executive Brendan Thomas added that while businesses could have safeguards that apply to multiple jurisdictions, their systems needed to reflect local regulatory requirements.
“This is a global company operating across borders in a high-risk environment. We expect robust customer identification, due diligence, and effective transaction monitoring,” he said in the statement. Binance has 28 days to nominate external auditors. General manager of Binance Australia and New Zealand Matt Poblocki said in a statement that the company had “engaged openly and transparently with AUSTRAC over the past several months”.
“We remain committed to maintaining best-in-class compliance standards and will continuously enhance our capabilities,” Poblocki added. Binance, the world’s largest cryptocurrency exchange by volume, was created in 2017. It has cornered much of the crypto-trading market, turning its co-founder and former CEO Changpeng Zhao into a billionaire.
While Binance was founded in China, Zhao moved its operations to other locations internationally after a crackdown on the crypto sector by Beijing. Binance runs crypto exchanges and provides other services around the world, but it took a severe hit when crypto markets collapsed and regulators began probing the legality of its business. The firm has been accused in several countries of allowing criminal organisations to launder funds through its platform. Zhao pleaded guilty to violating US anti-money-laundering laws in late 2023 and served a four-month prison sentence for it in 2024.
© 2024 AFP
