Date posted: 02/12/2021

CA ANZ backs tougher AML and counter-terrorism stance

CA ANZ has confirmed its willingness to join the effort to stamp out illegal practices.

In brief

  • Professional accounting bodies emphasised the need for a cost-benefit analysis
  • They called for Tranche II to leverage existing professional and ethical standards
  • They also sought consideration of existing regulatory obligations

Professional accounting bodies told a hearing of the Legal and Constitutional Affairs References Committee on November 9 that they support  the introduction of Tranche II of the anti-money laundering and counter-terrorism financing regime in Australia.

The Senate Committee is considering the adequacy and efficacy of Australia's anti-money laundering and counter-terrorism financing regime. 

Karen McWilliams FCA, Business Reform Leader, CA ANZ said that to capture accountants under Tranche II would “require specific amendments to the regime rather than simply being captured under the current regime”. 

The professional accounting bodies said a cost-benefit analysis was needed to ensure inclusion was efficient and effective given that accountants were inherently different from financial institutions.

This means the design should consider and leverage the wide range of professional and ethical standards and industry oversight already in place for professional accountants.

‘The duplication of existing compliance obligations on accountants would exacerbate the compliance burden and associated costs, particularly for our small practice members,” McWilliams said.

For example, the Commonwealth should avoid duplicating the Australian Taxation Office and Tax Practitioners Board’s recently released client verification guidelines that align with AML/CTF client due diligence requirements. 

Tranche II provides the opportunity to align regulatory obligations across all Commonwealth agencies and harness existing and emerging technologies to rely on technology first ID verification processes.  

The professional accounting bodies therefore welcome comments from the Department of Home Affairs that work is underway to design a cost-benefit analysis on how best to expand the regime to Tranche II.  

“We want to do a stocktake or have an understanding of the existing regulatory obligations and professional obligations and look at those in terms of what may cover the field, what we would leverage and where the gaps are, and how we might address those,” said Ciara Spencer, First Assistant Secretary, Aviation and Maritime Security and Executive Director Transport Security, Department of Home Affairs. 

There should be extensive consultation with a broad range of stakeholders throughout the process, including raising awareness with consumers. 
Karen McWilliams FCA, Business Reform Leader, CA ANZ

“We're really focusing on getting high-value actionable intelligence without a great regulatory impost.”   

McWilliams added that: “There should be extensive consultation with a broad range of stakeholders throughout the process, including raising awareness with consumers” to ensure the inclusion of professional accountants was effective and efficient. 

The Chair, Senator Kim Carr, asked: “Would that principle – of industry associations being given some temporary assistance to help in the transition to a new regulatory regime – be of any value?” 

This suggestion was welcomed by the professional accounting bodies given the significant reform and regulatory changes over the past 18 months and the impact of COVID, particularly on smaller and sole practitioner firms.  

The committee is expected to report back by the last sitting day in March 2022 and CA ANZ is ready to work with the relevant government agencies and other professional bodies to create a robust regime to prevent criminals from using Australia for illegal activities. 

Related submission

Read our submission on the adequacy and efficacy of Australia’s anti-money laundering and counter-terrorism financing regime.

Read more

Related public hearing

Listen to the public hearing. Accounting bodies start at around 15:25.

Listen here

Read our media release

CA ANZ supports stronger anti-money laundering and counter-terrorism finance regs

Read more

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