Austrac has published reports identifying its surveillance in the illicit tobacco trade, the wealth management sector and foreign‑owned banks.
Austrac says it has completed 2 separate supervisory campaigns targeting different parts of the foreign-owned banking sector. These campaigns showed that weaknesses in controls and reporting are creating opportunities for criminals to exploit Australia’s financial system.
The campaigns examined low suspicious matter reporting (SMR) in foreign bank branches as well as money mule risks in foreign bank subsidiaries.
Austrac says high risk behaviours and unusual or suspicious customer transactions include providing services to foreign politically exposed persons (PEPs) and relatives and associates of foreign PEPs, domestic and foreign private companies, trusts and foundations, as well as high net wealth individuals.
Austrac says that Australia’s illicit tobacco market presents a serious organised financial crime problem, generating significant criminal profits and driving violence, tax evasion and community harm.
AUSTRAC provided banks with a unique reference code to use in suspicious matter reports, enabling illicit tobacco activity to be more easily identified, tracked and disrupted.
In the wealth management sector Austrac has written to businesses in the wealth management sector with concerns about alarmingly low suspicious matter reporting (SMR) and the risk that serious financial crime may be going undetected.
The letter follows a supervisory campaign in which we found that 98 per cent of wealth management businesses did not submit a single SMR in 2025, despite operating in a sector exposed to a wide range of money laundering risks.
While many firms reported having no high‑risk customers, Austrac says that this was inconsistent with the nature of the sector, which can involve complex investment structures, cyber‑enabled fraud and the use of intermediaries.
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Author: David Jacobson
Principal, Bright Corporate Law
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About David Jacobson
The information contained in this article is not legal advice. It is not to be relied upon as a full statement of the law. You should seek professional advice for your specific needs and circumstances before acting or relying on any of the content.
