Compass Global Holdings to pay $252,000 over failure to report international funds transfers

AUSTRAC has issued $252,000 infringement notice to Compass over its failure to report international funds transfers between 2018 and 2019.

Australia’s financial intelligence agency AUSTRAC has earlier today announced that it has issued $252,000 infringement notice to Compass Global Holdings Pty Ltd, a company which provides payment products, foreign exchange contracts and derivatives. The penalty is due to Compass’ failure to report international funds transfers between 2018 and 2019.

The regulator explains that the entities it regulates, such as money transfer dealers and banks, are required to submit International Funds Transfer Instruction (IFTI) reports to AUSTRAC in a timely manner. This is pursuant to a requirement under the Anti-Money Laundering and Counter-Terrorism Financing Act 2006.

AUSTRAC says it is now working with Compass to address concerns that it does not have adequate systems and processes in place to identify, mitigate and manage money laundering and terrorism financing risks.

Money transfer businesses are a major part of Australia’s financial system, with individuals and businesses reporting $60 billion worth of international funds transfer instructions sent and received by people in Australia using registered money transfer services in 2018/19. In the same year, there were around 17.3 million transactions reported through Australia’s registered remittance (money transfer) sector.

“AUSTRAC is working with Compass, to ensure they understand their compliance obligations. Where businesses don’t comply with the law, AUSTRAC will not hesitate to take action to protect Australia’s financial system and the community from criminal activity,” AUSTRAC Chief Executive Officer, Nicole Rose PSM said.

Last month, AUSTRAC launched a national, community-focused campaign to target illegal money transfer dealers that have not registered with AUSTRAC. The campaign aims to raise awareness among money transfer businesses of the risks posed by illegal money transfer businesses.

AUSTRAC notes that it has a range of enforcement powers available, such as issuing infringement notices and seeking injunctions and/or civil penalty orders in the Federal Court, as well as referring a matter to the Commonwealth Director of Public Prosecution for possible criminal prosecution.