Binance Australia Must Conduct Audit Over Anti-Money Laundering Concerns, AUSTRAC Says

Australia's financial crimes regulator, Australian Transaction Reports and Analysis Centre (AUSTRAC), has ordered Binance Australia to appoint an external auditor after raising concerns over its anti-money laundering and counter-terrorism financing (AML/CTF) controls. The Australian exchange has 28 days to name the auditors and gain the approval of the regulator. The order comes after AUSTRAC pointed out issues in Binance's governance. The concerns include the limited scope of its recent independent review, the high rate of turnover, and poor senior management supervision. The regulator emphasised that these shortcomings have raised questions about the exchange's system.

AUSTRAC Says Binance Must Tighten Anti-Money Laundering Safeguards

AUSTRAC CEO Brendan Thomas said, “Big global operators may appear well resourced and positioned to meet complex regulatory requirements, but if they don't understand local money laundering and terrorism financing risks, they are failing to meet their AML/CTF obligations in Australia [...] The systems must adapt to the regulatory requirements, not the other way around.”

Thomas further mentioned that AUSTRAC's National Risk Assessment 2024 highlighted the growing vulnerability of digital currencies to criminal abuse. He noted that businesses should use independent reviews rigorously, ensure strong oversight, and strengthen transaction monitoring.

“This is a global company operating across borders in a high-risk environment. We expect robust customer identification, due diligence, and effective transaction monitoring,” Thomas said. He reminded all peer crypto operators to stay alert to scams, cybercrime, and financing terrorism. 

This marks one of AUSTRAC's strongest interventions in the digital asset sector, intensifying the regulator's need to scrutinise global exchanges with a larger user base. Analysts suggest that although the intervention of an external auditor might disrupt Binance's operations in Australia, the results could lead to severe actions if all the shortcomings are not addressed.

AUSTRAC has highlighted that compliance systems must meet the Australian conditions, and not just global frameworks. It also expects that the risk controls to solve the concerns, especially for an exchange as large as Binance, which handles multi-billion dollar deals. 

Binance is registered as a digital currency exchange in Australia through Inestybit Pty Ltd. The company is a part of Binance Global, the world's largest centralised crypto exchange by trading volume, and was founded in 2017. Binance holds approvals in around 20 jurisdictions.