Australia's AUSTRAC Warns Banks To Enhance Monitoring Of Illegal Tobacco And E-cigarette Money Flows

According to the Bankingday news report on November 10th,
The Australian Financial Intelligence Regulatory Authority (AUSTRAC) has issued a latest warning, demanding that major banks immediately enhance risk management for transactions involving tobacco stores, convenience stores, private ATMs, and Eftpos (electronic payment terminals) networks, in order to cope with the increasingly rampant illegal tobacco and e-cigarette transactions.
Brendan Thomas, the CEO of AUSTRAC, stated that non-bank ATMs and some sales-side payment systems are being used by criminal gangs to purchase illegal tobacco products and launder related cash proceeds.
"Any bank that receives funds through these channels has the risk of being associated with illegal earnings."
Thomas emphasized that banks should re-evaluate, mitigate, and eliminate these risks as much as possible, and impose higher requirements on banks still serving tobacco and convenience store customers, requiring them to closely monitor suspicious transactions and report them actively. He pointed out that this action is to refocus the anti-money laundering (AML) mechanism to curb the rapidly growing criminal trade. Due to the upgraded regulation, thousands of merchants may have their accounts terminated by banks (de-banking).
"This is a criminal industry that generates billions of Australian dollars in illegal earnings each year, threatening Australia's economic integrity and social security."
Meanwhile, AUSTRAC reminds banks that while increasing scrutiny, they should avoid harming legitimate enterprises, especially in remote areas, and still ensure the reasonable availability of cash services.
"Our common goal is to combat criminal enterprises, not to hinder legitimate economic activities."
This action is coordinated by the Illicit Tobacco and E-cigarette Commissioner's Office, and AUSTRAC is responsible for implementing the regulation through the Anti-Money Laundering and Counter-Terrorist Financing Act (AML/CTF), forming part of Australia's multi-departmental joint strategy to combat the illegal tobacco market.
AUSTRAC stated that multiple cross-institutional actions are currently underway, covering both the supply chain and the demand chain, with the goal of weakening the illegal market, reducing criminal activities, and reducing the harm to society and public health.
Thomas concluded: "Banks in Australia play a crucial role in preventing the financial system from being abused by criminals. We need to cut off the criminal's funding chain and prevent them from continuing their transactions. I believe no bank would want 'black money' to enter their system."