AUSTRAC has ordered Binance Australia to appoint an independent external auditor after finding serious shortcomings in the exchange’s AML and CTF systems, citing weak customer ID, transaction monitoring and inadequate local senior management oversight to address criminal risk.
-
AUSTRAC requires an independent external audit of Binance Australia’s AML/CTF controls.
-
Regulator cited weak customer identification, transaction monitoring and high staff turnover as core concerns.
-
Regulatory scrutiny follows prior ASIC actions, license cancellations and suspension of AUD fiat services.
AUSTRAC orders Binance Australia audit — independent external auditor required after AML/CTF shortcomings; what it means for users and compliance. Read more.
What did AUSTRAC order Binance Australia to do?
AUSTRAC ordered Binance Australia to appoint an independent external auditor after identifying significant deficiencies in Anti-Money Laundering (AML) and Counter-Terrorist Financing (CTF) controls. The audit will assess customer identification, due diligence, transaction monitoring and governance to ensure compliance with Australian regulatory standards.
How serious were the AML and CTF shortcomings?
AUSTRAC described the shortcomings as serious enough to trigger a supervisory review measure. The regulator cited weak customer identification, inadequate transaction monitoring and insufficient senior local oversight. AUSTRAC CEO Brendan Thomas noted that digital currencies face heightened vulnerability to criminal abuse, prompting targeted action.
AUSTRAC has ordered Binance Australia to appoint an external auditor after identifying serious shortcomings in the exchange’s Anti-Money Laundering and Counter-Terrorist Financing controls.
Why has Binance faced regulatory action in Australia?
Binance Australia has faced multiple regulatory challenges. In late 2024 the Australian Securities and Investments Commission (ASIC) initiated legal action targeting alleged consumer protection failures by Binance Australia Derivatives.
Earlier investigations led to cancellation of the local derivatives license after reviews and office searches. Regulators cited issues such as erroneous classifications of some users as wholesale clients and notifications that followed.
How has banking access and fiat services been affected?
In 2023 Binance suspended Australian dollar fiat services after its local payments provider, referred to as Zepto in public reporting, was instructed to stop supporting the exchange. The suspension left users unable to use the standard bank transfer option and prompted reliance on USDT conversions or peer-to-peer transfers.
What did Binance Australia say about AUSTRAC’s decision?
Binance Australia and New Zealand general manager Matt Poblocki acknowledged AUSTRAC’s decision and described the appointment of an external auditor as a supervisory review measure rather than an enforcement action. The company has advised affected users on alternative withdrawal methods.
What are the compliance implications for users and the industry?
Immediate implications include increased regulatory oversight and potential operational changes at Binance Australia. Users may face continued limits on AUD withdrawals until remediation is complete. The action signals heightened expectations for local governance, staff resourcing and robust transaction monitoring across crypto firms.
Frequently Asked Questions
How long will the external audit take?
Timelines vary by scope; external audits of AML/CTF frameworks typically run from several weeks to a few months depending on remediation needs and regulator feedback.
Can users still move Australian dollars off the platform?
Many users remain unable to use bank transfers for AUD; Binance has advised alternatives like USDT transfers or peer-to-peer trading while local payment channels are suspended.
Key Takeaways
- Regulator action: AUSTRAC requires an independent audit focused on AML/CTF gaps.
- Operational risks: High staff turnover and weak local oversight were highlighted as risks to compliance.
- User impact: AUD fiat withdrawals remain constrained; users should plan alternate withdrawal paths.
Conclusion
AUSTRAC’s directive for Binance Australia to appoint an external auditor underscores regulatory expectations for robust AML and CTF controls and stronger local governance. The move follows a string of regulatory actions and could reshape how Australian crypto firms manage compliance. Monitor COINOTAG updates for further developments and guidance.
