One of our trusted banking corporations has fallen into the spotlight for the wrong reasons. Late last month, a Government agency known as Austrac alleges that the corporate giant, Westpac failed to abide by their moral and ethical duties to tackle child exploitation.

The guardian paints a vivid picture stating that Westpac has failed to monitor 12 customers who made purchases in relation to child exploitation in the Philippines who have now been charged for child sex trafficking and live streaming of child abuse.

In addition to the above point, Westpac is alleged to have failed to uphold basic counter-terror finance laws. Reinforcing this point, Austrac has claimed that more than 3000 payments totaling $500,000 dollars in transactions have gone undetected for years. However, only now the CEO, Mr. Brian Hartzer states that “he will be personally leading responses to all of these issues”. Please click here to see the transaction details of these 12 customers.


Austrac is a Government funded financial institution which was established to monitor the wide range of financial transactions. This was implemented by the Government to give Austrac the tools needed to tackle any criminal transactions which includes but is not limited to; tax fraud; organised criminal activity; and financial terrorism.


Australia took steps to crack down on these criminal transactions by implementing a monitoring system in 2009 known as SWIFT (Society for Worldwide Interbank Financial Telecommunications). SWIFT uses its resources to monitor wire transfers. This is vital as the majority of criminal transactions occur through wired transfers. With that in mind, the paramount purpose of SWIFT is to ensure financial corporations such as Westpac comply with the regulations by reporting every inbound and outbound transaction.

AUSTRAC indicated early in 2016 that the introduction of a cheap international payment service known as LitePay can be a forefront for criminal activity if it is not monitored correctly. According to the Sydney Morning Herald, it is alleged that Westpac has not introduced a system to detect suspicious transactions until 2018. Please click here for further information about these allegations.


AUSTRAC has now initiated civil proceedings against Westpac for these breaches. According to Investor Daily, AUSTRAC is seeking civil penalties for 23 million contraventions of Anti-Money Laundering and Counter-Terrorism Financing Act 2006.


The legislation that applies to criminal transactions can be found in Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (The ‘Act’). Pursuant to Section 41(1) of the Act, Westpac is obliged to report any suspicious transactions. Please click here to read Section 41 in depth.

Furthermore, once it is satisfied that a suspicious transaction has occurred, it needs to be reported immediately to AUSTRAC. Section 41(2) of (The Act) requires that the delegate must be given a report about the matter in order to deal with the matter competently. To discuss the law further with our Sydney Criminal Lawyers, please contact us.

The law has since been amended with the enactment of the Anti-Money Laundering and Counter Terrorism Financing Amendment 2017 (AML/CTF Amendment Act). This amendment has introduced three major changes:

  1. Greater regulatory powers and functions for the Austrac CEO;
  2. Digital currency exchange providers are now subject to the AML/CTF regime; and
  3. Regulatory relief for industry.

What this means in simple terms is Austrac CEO has the power to issue infringement notices to financial corporations for failing to adhere to the ALM/CTF rules and regulations.

According to the Judicial Information Research System (JIRS), 53 reports were made about movements of physical currency into or out of Australia and 137 reportedly produced false or misleading documents. It is arguable that there needs to be tougher regimes in place to tackle these issues.


According to the Office of the Australian Information Commissioner in order to prevent money laundering and finance-terrorism, corporations must be able collect and confirm your personal details. Arguably, not only do these corporations need to abide by the AML/CTF Rules but also the Privacy Act 1988.

With that in mind, Division 5 of Part 2 of the AML/CTF Rules allows disclosure of personal information that is held by a financial corporation such as Westpac. However,  there are restrictions. The AML/CTF Rules only allows disclosure of a person’s residential address, birth details and full name. Please click here for further information about Anti-money laundering rules and regulations.


According to the Australian Government Department of Home Affairs, in early November 2019, Australia portrayed its enthusiasm for tackling such a broad issue when it decided to host the ‘No Money for Terror’ Ministerial Conference in Melbourne. The support was evident with more than 15 international bodies attending including the United Nations and the Financial Action Task Force.

The conference reinforced five key obligations that are governed under the AML/CTF Rules to ensure efficient deterrence of criminal activity. These obligations include:

  1. Enrolment: All businesses must be enrolled with AUSTRAC.
  2. Implementing an AML/CTF program: This will help manage and monitor criminal activity.
  3. Customer due diligence: ensuring customer details are correct.
  4. Reporting: ensuring suspicious matters are reported in accordance with Section 41.
  5. Record keeping: All businesses must keep record of all electronic transfers.

Please click here for further information regarding the ‘No Money for Terror’ Conference.


As always, National Criminal Lawyers® is constantly up to date with all changes that are occurring across New South Wales. Our Sydney Criminal Lawyers offer nothing short of excellent results in relation to these matters. With over 80% of defended hearings won and 94% no conviction record, our services are second to none.

Most importantly, National Criminal Lawyers ensures that the general public are aware of these changes and aware of their rights. Please click here to ensure your rights are defended by the best criminal lawyers there is on offer.

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