PayPal gets serious slap on the wrist from AUSTRAC

Agency finds PayPal's systems inadequate for anti-money laundering and counter-terrorism financing laws

PayPal Australia has agreed to undergo an enforceable undertaking after it was found to have breached anti-money laundering and counter-terrorism financing laws by AUSTRAC.

The agency found that PayPal did not have adequate systems in place to asses and manage the risk associated with the anti-money laundering and counter-terrorism financing laws.

As part of the enforceable undertaking PayPal has agreed to several actions including to revise its risk assessment, review and strengthen its systems and controls, and submit a Remedial Action Plan by the end of July 2010.

In a statement, AUSTRAC CEO, John Schmidt said the undertaking was the third the agency had accepted.

"Compliance with the Act's risk assessment requirements is crucial in Australia's fight against money laundering and terrorism financing," he said. "The acceptance of this undertaking is a clear sign to industry that they must have robust systems and controls in place to manage and mitigate the risks their business may face."

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Tags paypalAUSTRACanti-money launderingcounter-terrorism financing

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