- Australia‘s financial intelligence agency AUSTRAC is targeting inactive registered crypto exchanges to prevent potential scams.
- Out of 427 registered exchanges, many are suspected to be inactive and vulnerable to criminal exploitation.
- AUSTRAC plans to publish a public list of registered exchanges to help Australians identify legitimate providers.
AUSTRAC, Australia’s financial intelligence agency, has launched a campaign targeting inactive cryptocurrency exchanges, warning them to either resume operations or have their registrations canceled. The agency announced on April 29 that it’s concerned dormant firms could be exploited by scammers seeking to appear legitimate.
Currently, 427 crypto exchanges are registered with AUSTRAC, but the agency said it believes a significant number are no longer active. Brendan Thomas, AUSTRAC’s CEO, emphasized their "use it or lose it" approach: "Businesses registered with AUSTRAC are required to keep their details up to date; this includes details about services that are no longer provided."
In Australia, businesses offering conversions between cash and cryptocurrency, including crypto ATM operators, must register with AUSTRAC, which monitors for financial crimes such as money laundering, terrorism financing, and tax evasion. The agency has the authority to cancel registrations when there are reasonable grounds to believe a business is inactive or no longer offering crypto services.
Registration Cancellations and Public Registry Coming
Since 2019, AUSTRAC has canceled the registrations of ten firms, with FTX Express – the Australian subsidiary of the collapsed crypto exchange FTX – being the most recent cancellation in June 2024.
Following its crackdown on inactive exchanges, AUSTRAC plans to publish a public registry of registered exchanges to help Australians verify legitimate providers. Thomas explained that this initiative aims to "make it harder for criminals to scam people and improve the integrity and accuracy of AUSTRAC’s register."
Broader Regulatory Actions
In February, the anti-money laundering regulator took action against 13 remittance service providers and crypto exchanges, with investigations into more than 50 others still ongoing regarding possible compliance issues. Six providers were denied registration renewal because key personnel had been convicted, prosecuted, or charged with serious offenses.
Australia has yet to implement comprehensive crypto regulations. The ruling Labor Party began industry consultations in August 2022 to develop a regulatory framework. In March, the government proposed new regulations that would bring exchanges under existing financial services laws ahead of the May 3 federal election.
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