AUSTRAC — Australia’s money laundering and counter terrorism financing watchdog — says that it has suspended the registrations of two digital currency exchanges.
The move follows the arrest by the Australian Federal Police of a 27-year-old man from the Melbourne suburb of Bulleen who was allegedly a “key member” of the crypto services.
The AFP investigation dates back to 2017 when two Victorian men were arrested and charged with drug importation offences. The AFP said following those arrests it continued its investigation into the import of illicit drugs via mail, leading to a series of raids carried out yesterday.
The AFP raided premises in Bulleen, Templestowe Lower and Malvern. During the raids steroids, money and “cryptocurrency related items” were seized, according to the AFP.
The Bulleen man has been charged with allegedly importing, trafficking and possessing 30 kilograms of drugs, including MDMA, cocaine, methamphetamine and ketamine.
The AFP said it would allege that he “played 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.”
The Criminal Assets Confiscation Taskforce obtained orders to restrain property valued in excess of $2 million related to the investigation.
“Investigations such as this are inherently complex and the operational results achieved by the investigative team are a testament to good police work and strong interagency cooperation,” said AFP Detective Superintendent Paul Hopkins.
AUSTRAC issues warning to cryptocurrency exchanges
Separately today AUSTRAC and NSW Police warned digital currency exchanges to be aware of their obligations under federal anti-money laundering rules.
Last year the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 was amended to bring cryptocurrency within its scope. The government in late 2017 moved to close what it described as a “regulatory gap” in the treatment of digital currencies.
“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. We continue to actively monitor the sector’s compliance,” said AUSTRAC’s national manager for regulatory operations, Dr Nathan Newman.
“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.”