Financial planners hiding criminal, terrorist activity: AUSTRAC report

ONE of Australia’s spy agencies says insiders are hiding the true level of terrorist and organised crime involvement in the $4.6 billion financial planning industry.

AUSTRAC says insiders are hiding the true level of terrorist and organised crime involvement in the $4.6 billion financial planning industry. Generic picture: iStock

ONE of Australia’s spy agencies says insiders are hiding the true level of terrorist and organised crime involvement in the $4.6 billion financial planning industry.

It also accused the nation’s 23,000 financial planners of not fully understanding their obligation to report suspected terrorism financing and money laundering.

A new report by federal intelligence agency AUSTRAC, seen by the Herald Sun, says: “AUSTRAC assesses that there is significant under-reporting of suspicious matters by financial planners.

“AUSTRAC assesses that, at a sector level, financial planners have only a partial understanding of their anti-money laundering and counter-terrorism financing obligations, with many not fulfilling the requirements to have risk-based customer due diligence procedures and to submit suspicious matter reports.”

The Herald Sun recently revealed AUSTRAC has discovered some Australian jihadis have drawn on their superannuation funds to finance activities with Middle Eastern terrorist groups.

AUSTRALIAN JIHADIS DRAW ON SUPERANNUATION FUNDS TO HELP FINANCE MIDDLE EAST TERROR GROUPS

Justice Minister Michael Keenan said on Tuesday the new AUSTRAC report, the first risk assessment of its kind, had found a medium-level risk.

“Australia’s financial planning industry raised $4.6 billion in revenue in 2016 and is accessed by one in five Australians, so it’s crucial that we work together with industry to protect it from criminal abuse,” he told the Herald Sun.

The AUSTRAC report said organised crime gangs were deliberately seeking financial planners in Australia who had weak anti-money laundering or counter-terrorism financing controls, “or who turn a blind eye to suspicious behaviour”.

It also said there was evidence the financial planning sector was being exploited to “launder money and conceal the proceeds of crime”.

AUSTRAC CEO Paul Jevtovic on Monday said it was very important for financial planners to be able to detect, understand and disrupt criminal threats and AUSTRAC was working closely with them to help them do so.

Financial Planning Association of Australia CEO Dante De Gori on Monday welcomed the AUSTRAC report, saying it would be used in the industry as a reference tool to fight financial crime.

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