The AML/CTF legislation contains a number of definitions that are important to understand for present purposes. These include the following.
Remittance services (alternative remittance services)
Services involved in transmitting money or property, including informal systems or networks outside of the formal banking sector. A remittance arrangement is between persons who are not ADIs, banks, building societies, or credit unions.
All financial institutions, money service businesses and designated non-financial businesses and professions, providing the designated services outlined in s 6 of the AML/CTF Act 2006 (Cth). Reporting entities may be collectively referred to as the regulated sector.
A person or entity conducting, as a business, one or more of the following activities or operations on behalf of a customer:
- accepting deposits and other repayable funds from the public;
- lending and financing commercial transactions;
- financial leasing;
- transferring money or value;
- issuing and managing means of payment such as stored value cards;
- providing financial guarantees and commitments;
- trading in money market instruments, foreign exchange, exchange, interest rate, and index instruments, transferable securities or commodities;
- participating in securities issues;
- portfolio management;
- otherwise investing, administering, or managing funds on behalf of another person;
- underwriting and placing life insurance and other investment-related insurance products; and
- money and currency exchanging.
Financial institutions may be ADIs, banks, building societies, credit unions, or other persons specified in the AML/CTF Rules.
Designated non-financial businesses and professions
Businesses, outside of the financial and money service business sectors, offering a service outlined in s 6 of the AML/CTF Act. The DNFBPs identified by FATF are:
- real estate agents;
- dealers in precious metals;
- dealers in precious stones;
- legal practitioners, notaries, other legal professionals and accountants providing services to external clients; and
- trust and company service providers.
Bullion dealers are currently the only DNFBPs providing a designated service in Australia.
Financial Intelligence Unit
A central agency responsible for receiving (and as permitted, requesting), analysing and disseminating disclosures of financial information:
- concerning suspected proceeds of crime and potential financing of terrorism; or
- required by national legislation or regulation in order to combat money laundering and terrorist financing.
Tipping off provisions
Requirements for entities filing reports of suspicious financial activity to avoid disclosing information about the details of the report, or the existence of a report, to the subject of the report or another prohibited party.
Penalties imposed following a criminal conviction for an offence.
Penalties imposed following civil proceedings rather than proving an offence to a criminal standard or with criminal court procedures.
Financially motivated offences generating funds to be laundered.