Why Australian Financial Institutions Need the AML/CT Compliance
You can find that Australia has approximately 98 banks and 40 credit unions and building societies. You also have at least six money market corporations, like broker-dealers, 129 finance companies, and 1,990 insurers and fund managers. Each of those entities has one similar goal: to protect their Australian client’s financial assets and keep integrity high.
However, they need to make sure that their client’s financial assets were acquired legally and not through criminal activities, which is why they require the assistance of anti-money laundering in Australia area-based companies. You have to learn about the importance of AML/CT compliance, primarily if your company handles the client’s monetary assets.
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1. Avoid Costly Fines
Australian financial companies need to comply with the AML/CT program because of the costly fines that they will encounter when it happens. Ever since the program started, there has been a steady increase in anti-money laundering regulators. In 2009, regulators worldwide acquired roughly $32 billion in global fines related to anti-money laundering.
Even the famous Standard Chartered financial institution was fined up to $1.1 billion for their money laundering activities. You can already tell that any financial institution within Australia will face costly penalties if they get caught aiding money laundering and terrorism financing. So you have to save your company from going underwater and get the AML/CT compliance as early as possible.
2. Reduce the Risk of Criminal Threats
When an Australian financial institution’s security heightens, so do the methods and techniques of criminals. They adapt to the security system implemented to keep them away and find more ways to bypass them, and you can say the same thing with money laundering. As a result, the money laundering threat has significantly evolved throughout the years, and every process becomes exceptionally complicated.
Many criminals in Australia and other parts of the world are using more advanced means to break through the anti-money laundering protocols of financial institutions. Fortunately, there are anti-money laundering in Australia area-based companies that assist entities in keeping up with compliance and learning the best processes and strategies to mitigate criminal activities.
3. Preserving the Reputation
There is nothing worse for Australian financial institutions than being labelled as one that aids in money laundering and terrorist financing. No entity would want that name on their brand because it stains their reputation to the point that they lose clients every day. Fortunately, the AML/CT compliance can prevent money laundering activities, keeping the entity’s reputation clean.
4. Avoid Significant Mitigation Costs
Whenever a money laundering activity happens to Australian financial services, they need a large sum of money to clean up the damage they have done. There is a report in 2018 which states that a financial service needs approximately $25.5 billion to mitigate money laundering risk. If you want to avoid paying for that absurd amount, it is best to comply with the AML/CTF Act all the time.
5. Improve Customer Satisfaction
When an Australian client tries to access their account in a financial institution, they usually have to go through several security checks. Back then, a lengthy verification check will make any client give up because it is wasting their time. Fortunately, many third-party organisations found ways to improve identity verification while maintaining the same level of security to detect any money laundering and terrorism financing activities.
Never forget that AML/CT compliance is crucial for every reporting entity within Australia. Without it, you expose your company to money laundering and terrorist financing activities, and you would not want that happening.
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