Background to the reforms
Development of the anti-money laundering and counter-terrorism financing (AML/CTF) legislation has resulted from an extensive consultation process between the Attorney-General's Department, AUSTRAC, industry and the community. The legislation achieves a balance between the Government’s law enforcement obligations and industry’s day-to-day business reality.
Initial consultation
On 8 December 2003 the Government, announced a review of Australia's AML/CTF system as part of the implementation of revised international standards issued by the Financial Action Taskforce on Money Laundering (FATF). The FATF is an inter governmental body which sets international standards and promotes policies to combat money laundering and terrorist financing.
The first stage of consultations with stakeholders in Australia's AML/CTF system resulted in a range of in-principle agreements between the Government and industry on the approach to the proposed reforms. Further details are contained in joint communiqués issued by the Government following a series of round table meetings with industry during 2005.
Following the conclusion of these consultations, the Government announced on 11 October 2005 that it would proceed with a package of reforms to strengthen Australia's AML/CTF system. The Government also decided that the reforms would be progressed in two tranches.
On 17 October 2005, the FATF published a Mutual Evaluation Report on Anti-Money Laundering and Combating the Financing of Terrorism on its evaluation of AML/CTF measures in place in Australia. The FATF identified strengths and weaknesses in Australia’s system.
On 16 December 2005, the Government released the exposure draft AML/CTF Bill (the exposure Bill) along with sample Rules for a period of four months of initial industry consultation which concluded on 13 April 2006. The Attorney General’s Department (AGD) received 120 submissions on the exposure Bill.
Submissions on the first exposure Bill (December 2005—April 2006)
The exposure Bill was referred to the Senate Legal and Constitutional Legislation Committee. The Committee reported on its inquiry on 13 April 2006.
Senate Legal and Constitutional Legislation Committee Report (April 2006)
The Government released the revised draft Bill and draft Rules for a further period of three weeks public consultation, which ended on 4 August 2006. The AGD received a further 70 submissions on the revised exposure Bill. A further meeting with key stakeholders on 28 August 2006 provided a further opportunity to refine the legislative package prior to Government consideration.
Submissions on the second revised exposure Bill (July—August 2006)
In September 2006 an independent Privacy Impact Assessment (PIA) was conducted to identify and address issues in the development of the AML/CTF legislation that may affect the personal privacy of Australians. The Government also published a Privacy Impact Statement which was largely a response to the PIA’s findings and recommenda tions and was used in its consideration of the AML/CTF Bill.
Since the PIA was written, the AML/CTF Bill has been revised, resulting in a renumbering of clauses within the Bill. A schedule
of renumbered clauses has been prepared to allow reference between the PIA and the final version of the Bill.
- Privacy Impact Assessment - PDF 667KB
- Privacy Impact Statement - PDF 202KB
- Schedule of Renumbered clauses - PDF 7KB
The AML/CTF Bill was introduced in the Parliament on 1 November 2006. After its introduction, the AML/CTF Bill was referred to the Senate Legal and Constitutional Legislation Committee. The Senate Committee reported on its inquiry on 28 November 2006.
Senate Legal and Constitutional Legislation Committee Report (November 2006)
On 7 December 2006 the AML/CTF Bill was passed by the Parliament and received Royal Assent on 12 December 2006.