AUSTRAC has instructed Binance Australia to secure an independent auditor on account of “serious concerns” about its anti-money laundering and counter-terrorism financing controls.
The subsidiary, operating as Investbybit Pty Ltd, is to submit a list of proposed independent auditors for the regulator’s review and endorsement within the next four weeks.
Australia To Appoint External Auditor
The step follows several months of dialogue and follows a detailed assessment that uncovered persistent weaknesses.
AUSTRAC emphasised that even as one of the largest platforms globally, the exchange’s own independent assessments conducted in Australia have so far lacked the depth and breadth needed to match the scale of its onshore activities.
Regulatory analysts emphasised several deficiencies in the exchange’s operations. Among the findings, constant staff churn, inadequate oversight from the local senior leadership team, and a shortage of dedicated onshore personnel to identify and manage risks were cited as primary causes.
AUSTRAC CEO Brendan Thomas stressed that international operators must do more than apply blanket compliance systems across multiple countries. He said, “Controls need to adapt to local regulations, not the other way around.”
Wider Enforcement on Crypto
The directive to Binance is part of AUSTRAC’s ongoing crackdown on non-compliant crypto service providers. The agency has targeted 13 remittance and digital currency exchange firms over similar breaches, while another 50 remain under investigation.
In recent months, 9 providers have had their registrations cancelled, suspended, or denied renewal for failing to meet AML and counter-terrorism financing obligations.
Authorities have also taken steps to address dormant or inactive entities that still appear on official registers. Over 400 registered platforms were warned that they face deregistration if they do not withdraw voluntarily.
Regulators say such gaps give criminals opportunities to misuse inactive licenses for fraudulent activity.
Public Register and Consumer Protection
In an effort to shield the public from fraud, AUSTRAC is set to roll out an online register that will let any user verify whether a cryptocurrency exchange is officially recognised and subject to supervisory scrutiny.
The initiative aims to empower consumers to spot and sidestep counterfeit services that falsely claim regulatory backing. By checking the database, investors will gain an additional safeguard against scams and improve their ability to make informed choices.
Alongside AUSTRAC’s efforts, ASIC has been expanding its clampdown on digital scams. The securities regulator has disabled over 10,000 fake platforms, including 7,200 fraudulent investment sites and 1,500 phishing scams.
In one court-approved action, ASIC moved to wind up 95 companies tied to international “pig butchering” schemes, following victim reports that added up to $35.8 million in losses.
Money Laundering Cases Emerge
Law enforcement agencies in Australia have uncovered multiple cases where organised groups used crypto exchanges to move criminal proceeds.
In a single prominent case, the Queensland Joint Organised Crime Taskforce charged 4 people in June with laundering $190 million.
The alleged scam involved combining illegal money with legitimate earnings through a Gold Coast security company before converting them into cryptocurrency.
Police carried out 14 search warrants in Brisbane and the Gold Coast, freezing $21 million worth of assets such as houses and cars.
Global Pressure on Binance
The case of Binance is not confined to Australia. In France, the exchange is also under investigation for suspected money laundering and breaches of financial laws.
The platform allegedly facilitated illegal activity related to drug trafficking and tax evasion, according to French prosecutors. Binance has denied the charges but is still under investigation.
The move against Binance also underscores the firmer approach regulators are taking as cryptocurrencies increasingly become embedded in financial systems.
Regulators in Australia are indicating that no operator, small or large, can count on offshore systems without porting them to local regulations.
Also Read: ASIC Warns Crypto Exchange Bitget Over Unlicensed 125:1 Crypto Futures In Australia