Response 24604909

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Questions about you

What is your name?

Name
Anooshe Aisha Mushtaq

Do your views officially represent those of an organisation?

Please select one item
Yes
No

Which sector is your organisation part of?

Please select one item
Academia
Federal government
Private sector
State or territory government
Other

Where are you located?

Please select one item
Australian Capital Territory
New South Wales
Northern Territory
Queensland
South Australia
Tasmania
Victoria
Western Australia
National
International

Is the entity you represent currently a regulated entity under Australia’s AML/CTF regime?

Please select one item
Yes
No

What is the size of your entity?

Please select one item
Sole practitioner
Small business (0-19 employees)
Medium business (20-199 employees)
Large business (200+ employees)
Other
N/A

Paper 1: Further information for real estate professionals

Does the proposed definition of real property and its intersection with the proposed designated services create any unintended outcomes with regard to real estate transactions?

Please select one item
Yes
No

To what extent do you think you would be able to leverage existing systems and controls to meet the proposed obligations?

Please select one item
To a great extent
Somewhat
Very little
Not at all

In what circumstances do you consider reliance among real estate professionals and other reporting entities for initial customer due diligence will be appropriate?

No comment

What additional information, guidance and materials would you require from AUSTRAC to help you comply with your new AML/CTF obligations?

AUSTRAC has provided sufficient information on their website.

What timeframe would you require to complete a risk rating for all pre-commencement customers (customers who you are in a business relationship with when the reforms commence)?

No comment

Paper 4: Further information for digital currency exchange providers (DCEPs), remittance service providers and financial institutions

Do you consider that the current term and associated definition of ‘digital currency’ is appropriate? What alternative terms outside of ‘digital asset’ might be considered, and why?

Please select one item
Yes
Somewhat
No
Please expand on your response
Digital currency and digital assets is only a small part of AML/CTF. There are many other ways to finance terrorism and this is based on the cultural insights. Digital currency can be tracked, however cash cannot be tracked and this has been used to finance terrorism. Therefore the term digital currency could be broaden.

How should the scope of NFTs subject to AML/CTF regulation be clarified?

No comment

Are there any services that may be covered by the term 'making arrangements for the exchange…' that should not be regulated for AML/CTF purposes?

Please select one item
Yes
No

Is the proposed language around custody of digital assets or private keys clear?

Please select one item
Yes
Somewhat
No

Does limiting proposed designated service 4 to businesses ‘participating’ in an issuer’s offer or sale of a digital asset clarify the scope of included services?

Please select one item
Yes
Somewhat
No

Are there any services currently provided by financial institutions that fall outside the definition of 'electronic funds transfer instruction', but would be captured by the 'value transfer' concept?

Please select one item
Yes
No

Is the terminology of ordering, intermediary and beneficiary institutions clear for businesses working in the remittance and digital asset service provider sectors?

Please select one item
Yes
Somewhat
No

Is the introduction of a limited designated service with appropriate exemptions the simplest way to clarify the transaction monitoring and risk mitigation and management expectations for intermediary institutions?

Please select one item
Yes
No

What flexibility should be permitted to address the sunrise issue or where a financial institution or digital asset service provider has doubts about an overseas counterparty’s implementation of adequate data security and privacy protections? What risk mitigation measures should be required?

No comment

Do you consider that the existing exemptions for the travel rule are appropriately balanced?

Please select one item
Yes
No
Please expand on your response
I have answered this in the Paper 5: Broader reforms to simplify, clarify and modernise the regime

Are there challenges for financial institutions reporting cross-border transfers of digital assets, including stablecoins, on behalf of customers?

Please select one item
Yes
No
Unsure
Please expand on your response
I have answered this in the Paper 5: Broader reforms to simplify, clarify and modernise the regime

Should the travel rule apply when transferring value incidental to a foreign exchange or gambling service?

Please select one item
Yes
No

What is the anticipated regulatory impact for smaller financial institutions and remittance providers in giving them primary responsibility to report IFTIs sent or received by their customers? Could this impact be offset by continuing to allow intermediary institutions to submit IFTI reports on behalf of smaller reporting entities, but with requirements for appropriate safeguards to ensure the accuracy and completeness of reports?

No comment

What should be the ‘trigger’ for reporting IFTIs? At what point is a reporting entity reasonably certain that the value transfer message will not be cancelled or refused and the value transferred?

No comment

What information should providers be required to report in a unified IFTI reporting template, covering both IFTI-Es and IFTI-DRAs?

No comment

Are there challenges with digital asset service providers reporting IFTIs to AUSTRAC as proposed?

No comment

Would the proposed amendments to the BNI definition in the Act reduce the volume of reportable BNIs and regulatory impost on business?

Please select one item
Yes
Somewhat
No

Would you like to provide any additional commentary?

I have answered this in the Paper 5: Broader reforms to simplify, clarify and modernise the regime

Paper 5: Broader reforms to simplify, clarify and modernise the regime

Under the outlined proposal, a business group head would ensure that the AML/CTF program applies to all branches and subsidiaries. Responsibility for some obligations (such as certain CDD requirements) could also be delegated to an entity within the group where appropriate. For example, a franchisor could take responsibility for overseeing the implementation of transaction monitoring in line with a group-wide risk assessment. Would this proposal assist in alleviating some of the initial costs for smaller entities?

Please select one item
Yes
Somewhat
No
Please expand on your response
There are business who would require clarity on AML/CTF program especially in the CALD communities. Many CALD businesses whether small or medium prefer to manage their business through "cash in hand" where the transactions are not recorded. Through online transactions or card payments its easier to track the payments, however it is difficult to track cash payments.

The streamlined AML/CTF program requirement outlined in this paper provides that the board or equivalent senior management of a reporting entity should ensure the entity's AML/CTF program is effectively identifying and mitigating risk. To what extent would this streamlined approach to oversight allow for a more flexible approach to changes in circumstance?

Please select one item
To a great extent
Somewhat
Very little
Not at all

Many modern business groups use structures that differ from the traditional parent-subsidiary company arrangement. What forms and structures of groups should be captured by the group-wide AML/CTF program framework?

Many CALD communities use family business structure and therefore cannot be captured by AML/CTF. The business is held under the cash in hand model majority of the time. It is difficult to tack these transactions. There are business community organisations which might get the funding from overseas, for example building a mosque. The organisations or builders supporting the mosque construction might seek funding from the community which is mostly in cash as a charity (Sadaqa) or Saudi Arabia has provided funding for mosques. These structures and groups are difficult to be captured as most or the transactions are not recorded.

To what extent do the proposed core obligations clarify the AML/CTF CDD framework?

Please select one item
To a great extent
Somewhat
Very little
Not at all
Please expand on your response
CCD can only be applied to the business which are based on electronic or digital transactions.

What circumstances should support consideration of simplified due diligence measures?

In the CALD communities it is difficult to understand the circumstances unless there is a cultural knowledge. For example, if a family is travelling overseas for their daughter's marriage they will require funds to host the wedding. This might require higher money transactions than AUD10,000 as specified by AUSTRAC. There are also many other factors like taking money overseas for relatives or parents.

What guidance should AUSTRAC produce to assist reporting entities to meet the expectations of an outcomes-focused approach to CDD?

No comment

When do you think should be considered the conclusion of a 'business relationship'?

There is much focus on digital currency. However and as mentioned there are many businesses and charity organisations (Zakat) which will receive cash from the CALD communities. There is no recorded information on the cash provided. There are business in Australia which are operating internationally. This is a risk as the money taken overseas is mostly in cash. The money digitally transferred could be shown as a gesture for the old parents or family in need.

What timeframe would be suitable for reporting entities to give a risk rating to all pre-commencement customers?

No comment

Are there situations where SMR or section 49 related information may need to be disclosed for legitimate purposes but would still be prevented by the proposed framing of the offence?

Please select one item
Yes
No

Are there any unintended consequences that could arise due to the proposed changes to the tipping off offence?

Please select one item
Yes
No

Would you like to provide any additional commentary?

The CALD communities culturally depend on cash in hand or keeping the cash at home. The risk is that with cash only it is difficult to trace terrorism funding. There are also religious based activities for example, Zakat which is heavily funded by the CALD communities. Every Muslim must pay 2.5% of it as Zakat from their earnings. Most of the Zakat is donated to Middle East due to the war situation. There are also other areas which cannot be tracked, for example weddings or dowry which is payment in cash or gifts for the family.