Management consultants based in Sydney and Hong Kong

Anti-Money Laundering and Counter-Terrorism Financing - AML/CTF Compliance Programs

Financial services organisations are being put under increasing regulatory scrutiny related to AML/CTF compliance and their obligations under the Anti‑Money Laundering and Counter‑Terrorism Financing Act 2006.

Australian institutions, such as financial services firms; banks; building societies; credit unions; superannuation funds and gambling are obliged to comply by the act and are, therefore, realising the importance of implementing and maintaining a robust compliance program.


Summarising our AML/CTF compliance program services

Great Minds provides AML/CTF programs tailored to an organisation’s specific requirements and obligations under the AML/CTF Act 2006.

  • AML/CTF obligations and compliance

    Understanding compliance and reporting obligations for identifying, mitigating and managing the risks.

  • Customer Due Diligence (CDD) / Know Your Customer (KYC)

    We help institutions verify and assess the risk factors relating to new and existing customers and their ultimate beneficiaries in accordance with local and global regulations and internal risk appetite as part of its Risk Based Approach (RBA).


Our approach to AML/CTF Compliance

Reporting entities must have an Anti-Money Laundering and Counter-Terrorism Financing (AML/CTF) program specifying how they comply with AML/CTF legislation.

The program must be a written document outlining how an organisation identifies, mitigates and manages the risk that their product or service is being used for money laundering and terrorism financing.

AML/CTF programs are a vital part of identifying, disrupting and preventing the illegal use of money in Australia. It is a requirement to have a written document outlining AML/CTF program before starting the provision of any designated services.

Below is our approach to putting together an AML/CTF program for Australian organisations:

  • Identify and assess obligations

    Identify, analyse and prioritise compliance risk and treat compliance risks to limit or reduce the impact and likelihood of reoccurrence.

  • Manage compliance obligations

    Actively manage compliance with legal and regulatory obligations, breach reporting, investigation and remediation.

  • Compliance monitoring

    Undertaking regular reviews of the compliance management framework, policy and procedures as well as an annual review of breach reporting and training gaps.

  • Reporting

    Rigorous compliance reporting with manual quality checks to ensure internal and government compliance obligations are met.


AML/CTF Compliance - Frequently asked questions

What is money laundering?

Money laundering is the attempt to disguise the proceeds of illegal activity so that they appear to come from a legitimate source or activity.

How does money laundering work?

Money laundering can take many forms, there are, however, three typical stages for money laundering.

  • Placement: When funds derived from illegal activity is placed into the financial system
  • Layering: Transactions designed to disguise the audit trail and identification of the initial source of the illegal funds.
  • Integration: When funds that appear to be legitimate transactions are paid out to the money launderer.

What is the difference between money laundering and terrorist financing?

In contrast to money laundering which involves disguising the original source of illegal funds, terrorist financing can be financed by legally derived money in order to carry out illegal activity.

The objective of money laundering is financial gain, whereas the objective of terrorist financing is to hide where the money will be deployed. For example, it is widely believed that the terrorist activities of September 11, 2001, were partially financed by legally obtained funds donated to charities.

What is terrorist financing?

Terrorist financing is a form of financial crime that uses funds to support the agenda, activity or cause of a terrorist organisation. Funds can come from legitimate sources, however, funds typically derive from criminal sources such as drug trade, weapons smuggling, fraud, kidnapping and extortion for illegal activity.

What is a Reporting Entity?

A Reporting Entity is an entity that provides a Designated Service under section 6 of the AML/CTF Act 2006. All reporting entities must meet obligations under the AML/CTF Act.

See: AML/CTF Act 2006 section 5

What is a Designated service?

A Designated Service is a service that is listed in section 6 of the AML/CTF Act 2006. These are services that have been identified to possess a risk for money laundering and terrorism financing by AUSTRAC.

Designated services include a range of business activities in the financial services, bullion, gambling and digital currency exchange sectors. Entities that provide any of these services are reporting entities. Reporting entities have obligations under the AML/CTF Act.

See: AML/CTF Act 2006 section 6, tables 1–3

Case Studies

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