2 Australian Crypto Exchanges Shut Down in Connection to Crime Ring

Australia's financial intelligence agency published a reminder that crypto exchanges must report suspicious activity.

Australian financial intelligence agency AUSTRAC has halted the operations of two cryptocurrency exchanges following the discovery of links between the exchanges and organized crime rings.

According to a report from ComputerWorld, the suspensions follow the arrest of a 27-year-old man who operated the cryptocurrency exchanges.

Discover Barcelona Trading Conference – A Top Tier Crypto Trading Event

The crime ring that the Australian Federal Police (AFP) have linked to the exchanges was originally discovered in 2017 when two Victorian men were arrested and charged with drug importation offenses. After those arrests, the AFP discovered a wider network of crimes involving the importation of illegal drugs via the postal system.

Crypto Exchanges Linked to Drug Importation in Australia

The 27-year-old man who was most recently arrested has been accused of “[playing] a key role in directing the operations of the criminal syndicate, which used various dark net sites, bitcoin accounts and legitimate business for the sourcing, payment and distribution of the illicit drugs.”

Suggested articles

TrustedBrokerz: The Source More Traders Are TrustingGo to article >>

It’s unclear whether the cryptocurrency exchanges whose operations have been halted were aware that they were being used for illicit purposes.

The arrest and the subsequent shutdowns prompted an announcement from AUSTRAC and the New South Wales Police Force reminding digital currency exchanges of their reporting obligations.

According to the announcement, amendments to the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 that was enacted in April of 2018 require cryptocurrency exchanges to “[register] with AUSTRAC, [verify] customer identity, [report] suspicious matters and over-threshold cash transactions; and [comply] with record-keeping requirements.”

Dr. Nathan Newman, AUSTRAC National Manager for Regulatory Operations, explained that there is no excuse for cryptocurrency exchanges who claim that they haven’t had enough time to become compliant.

“Digital currency exchange providers have had adequate time and opportunity to comply with these new laws and AUSTRAC has already refused the registration of two digital currency exchange providers,” he said. “We continue to actively monitor the sector’s compliance.”

He asserted that collaboration between cryptocurrency exchanges and law enforcement agencies is essential to keeping the Australian cryptocurrency industry free of crime. “It’s important that digital currency exchange providers meet their obligations so we can identify any instances of criminal activity using their services to launder money, fund terrorism or commit other serious crimes.”

Got a news tip? Let Us Know