Episode Transcript
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Speaker 1 (00:11):
Hello and welcome to
the Canberra Business Podcast.
I'm Greg Harford, your hostfrom the Canberra Business
Chamber, and today I'm joined byTim Burke, the Director of ACT
AML.
Tim, welcome to the podcast,thanks for having me Greg.
Now AML.
Anti-money laundering andcounter-terrorism finance
fighting is obviously somethingthat's topical in the world at
(00:33):
the moment, but what is ACT-AML?
Speaker 2 (00:39):
Well, act-aml is a
small business operating out of
the Canberra region and we'rehere to provide advisory
services to businesses.
Ctaml is a small businessoperating out of the Canberra
region and we're here to provideadvisory services to businesses
who are trying to comply withthe anti-money laundering
legislation and regulations thatare in place federally.
Speaker 1 (00:57):
And that sounds
really complicated and scary.
Is this new?
Speaker 2 (01:03):
It's not new for a
lot of regulated entities at the
moment.
Banks and financialinstitutions and a range of
other organisations have had tocomply since the Act came in in
2006.
They've been complying sinceabout 2009.
2009,.
(01:28):
But there are big changescoming and that will bring a lot
of new reporting entities intothe anti-money laundering space
that haven't been operating inthat space well, haven't been
complying with that legislationso far.
Speaker 1 (01:39):
So what kind of
businesses are going to get
caught up in the anti-moneylaundering net?
Speaker 2 (01:43):
So the new tranche,
two entities are law firms,
accounting firms and real estateagents and some precious metal
sort of jeweler type businesses,but the big group is real
estate agents when you look atnumber.
But it's going to be a bigchange for anyone who's dealing
with law firms, accountants andreal estate agents.
Speaker 1 (02:07):
And what do those
firms themselves need to know?
Speaker 2 (02:12):
So they need to know
that they must comply with the
Anti-Money Laundering Act ifthey offer what are called
designated services under theAct, and there's a significant
list of those, about ninedifferent types when you're
talking about professionalservices and a couple when
you're talking about real estate.
If you provide any of thoseservices, then you must have a
(02:36):
full anti-money launderingprogram.
You must have processes andprocedures in place to address
your anti-money laundering risksand ensure that you've got the
right approach in yourorganisation for the governance
of those legislativerequirements.
Speaker 1 (02:57):
So there'll be some
people listening to this,
possibly, who are surprised tohear that there aren't already
anti-money laundering rules inplace across those sectors.
Why has it taken us so long tocatch up on them?
Speaker 2 (03:11):
That's a good
question.
The law has been in place forfinancial services generally for
the better part of the last 16or so years.
What they call tranche two isan additional range of
non-financial institutionproviders of particular services
(03:36):
that are more susceptible tomoney laundering the
international bodies it's called.
The FATF, which is theFinancial Action Task Force, is
an international body that looksat international compliance,
and Australia is one of thefinal countries to put in the
(04:02):
tranche two capabilities andthat will then align us to what
is seen as global good practice.
Speaker 1 (04:13):
And just to be clear.
So at the moment you go and buya house or you make a big
financial transaction, you'realready having to provide sort
of screeds of information toyour bank or your real estate
agent or so forth.
You're saying that there's moreto come.
Speaker 2 (04:28):
To an extent, it
depends on how you, as an
individual or business, dealwith your lawyer, accountant and
real estate agent.
There are a range ofobligations relating to
identification that relate tothe Anti-Money Laundering Act
and how those businesses mustoperate.
(04:50):
There are also other pieces oflegislation that relate to how
land titles are exchanged and avariety of other compliance
obligations.
Some of these obligations mayoverlap or duplicate to an
extent or be new, depending onwhat the service is that's being
(05:10):
provided, and businesses alsoneed to work out within their
own offerings which ones areregulated, designated services
like giving advice on financialmatters or exchanging property
or buying and selling, but theymight provide other services
(05:32):
that aren't covered.
Things like being a propertymanager isn't the same sort of
regulatory obligation.
So you might be providingidentification and going through
various processes today thatcan be reused or are duplicative
, but there might be somebusinesses that you're dealing
(05:54):
with that need to do new things,and it's going to be a big
variety of different scenarioshere.
Speaker 1 (06:00):
Okay, and the key
date for businesses to be aware
of about all this is the 1st ofJanuary.
Speaker 2 (06:08):
No, well, the there
are a few different dates that
you need to know.
If you're an existing reportingentity, then and that applies to
pubs and clubs and andproviders of gaming services,
just so we're clear about thatso if you're, if you're
providing those sorts ofdesignated services, then you're
going to have to, by March theend of March, so 31st of March
(06:32):
2026, uplift your AML program tomake sure that it's in line
with the current expectationsand requirements.
You're going to have to have anew governance body to oversee
your program and make sureyou've got the right reporting
through to the real people whoare accountable in your business
(06:53):
from a senior leadershipperspective.
If you're not currentlyregulated, then after March 31,
2026, you have to register withAUSTRAC as a designated service
provider and you have until 30June 2026 to do that and after
(07:23):
that date you must be compliantand have your AML program in
place.
So you're going to have toimplement your program sometime
after March, but before 30 June,okay so 30 June 26 is the
deadline for anyone coming intothe system essentially to be
compliant.
Speaker 1 (07:39):
Well, let's jump back
a little bit to your business.
What exactly do you do as anAML consultant?
Speaker 2 (07:52):
Simply put, I'm here
to help.
If you've got a business inCanberra or in the region that
needs to be compliant with theAct, the obligations are on you
to comply.
And if I can help, if I canprovide support services or
(08:12):
advice or guidance or have alook at your program and make
sure you're ticking the rightboxes, I'm here to help.
That's really as simple as itis.
It's pretty niche.
There's a lot of supportmaterial out there from AUSTRAC
(08:33):
and it is really really good,and they're going to be putting
out a lot more for the tranche 2entities in the second half of
this year.
So we'll all look to see whatthat is and hopefully and I
expect it will be very helpfulwhat I've seen so far is very
good, but I think you'll stillneed help.
And if you've got a biggerbusiness or if you've got some
(08:56):
challenges in front of you thatyou're just unsure about, that's
what I want to help people with.
Speaker 1 (09:03):
And just to be clear,
this is national legislation,
right?
So you're caught up in this,whether you're operating across
the border in New South Wales orhere in the ACT.
Speaker 2 (09:11):
That's right.
This is federal Commonwealthlegislation that applies to all
Australian organisations.
Speaker 1 (09:20):
Yeah, Appreciate it's
early days and many businesses
won't have been giving thisnecessarily a huge amount of
thought so far.
But how long do you reckon itwill take an average business to
put in place the complianceprogrammes that it will need to
have?
Speaker 2 (09:44):
The requirements are
not small.
This is not a ticker box andshouldn't be a ticker box
approach.
It really does depend a lot onthe size of your business and
the complexity of your businessand the risks that your business
(10:07):
face.
And that's also what AUSTRACrepeatedly talk about.
They want you to make an honesteffort and have senior
management engagement and have acontinuous improvement
methodology and approach to theway you deal with your program.
(10:28):
So you need to be always in abit of a tug of war between what
you see in your businessoccurring, with a feedback loop
into your policies andprocedures, and what you're
doing to manage those risks andthen again watching to see how
(10:49):
they play out.
So it's not something thatshould be finished.
It should always be improvingand developing.
But to have a good program, youknow you need to really
understand what your policiesand procedures are.
You need to train all yourpeople.
(11:10):
You need to have goodonboarding processes.
These things will requireconsiderable investment, that
they all require time, effort,focus.
It's not something that you cansay.
It takes a week, a month or ayear In saying that if you're
(11:36):
regulated today, you've gotuntil the 31st of March next
year.
So there's a fair bit of workin redesigning your program to
make sure that it is meeting thecurrent requirements, setting
up that governance body thatthey want you to have and that
you should have to manage yourrisks and to make sure those
(11:59):
risks are visible If you're newto this whole space.
You've got less than a year now.
It's not going to be months.
You should start soon.
Speaker 1 (12:15):
Start now.
Start now, Tim.
You talk about having agovernance body.
What does that mean?
Speaker 2 (12:24):
It means having a
depends a bit on your entity
structure, but realistically itmeans the accountable people
that have the rights to makedecisions in your organisation
are aware of the risks and whatis occurring to mitigate those
(12:48):
risks.
Speaker 1 (12:50):
So that could be a
board in some cases.
Speaker 2 (12:52):
Could be the board.
It could be a specialisedsubcommittee of a board, if your
board does a range of things.
Again, it's hard to answer thatinsofar as each business is
different and the whole point ofit is that you look at your
business and you work out whatthe appropriate risk governance
(13:15):
approach is for that business.
So if you're a smaller operator, then that's going to be a very
concentrated function,concentrated function.
If you're a big multi-franchiseorganization, that could be the
other extreme and you're goingto have a range of challenges
(13:35):
around the different parts ofyour business and how they
should integrate and who'sresponsible for what.
But you need to put appropriatefocus on this to make sure that
the right people have the rightinformation and the right
visibility and the decisionsrelating to your risk appetite
are made at the right level.
Speaker 1 (13:56):
This sounds like a
very complicated exercise for
many businesses, but how big'sthe problem?
Do you think that thelegislative solution that we
have coming into force is itappropriate for what we're
seeing out there in terms ofmoney laundering, or is it a bit
of a sledgehammer to crack anut?
Speaker 2 (14:18):
That is a really good
question.
The answer really is one of itis absolutely necessary at an
aggregate level and when youhave risks like criminal
activities occurring in societyand in the community, you need
(14:45):
to make sure that there aren'tholes and back doors and easier
avenues for them to to gothrough.
So what is happening now reallycloses the loop and and make
sure that we are consistent withinternational standards.
we we aren't or we don't havesome sort of soft underbelly
(15:08):
that is, you know, being used orabused by organised crime or
criminal activities.
This helps and is the holisticoutcome that really supports the
national approach as a wholeand if we work together and
(15:29):
collectively, it helps everyone.
Speaker 1 (15:32):
So are we leading the
world in this stuff, or are we
playing catch-up?
Speaker 2 (15:37):
We're largely playing
catch-up.
A lot of other countries havealready, a number of years ago,
implemented the Tranche 2capabilities.
So Australia is one of theremaining countries, a few
remaining countries that haven'tgot the Tranche 2 capabilities
(15:59):
in, and so to that extent we'replaying catch-up.
Speaker 1 (16:03):
So how did you get
into all of this?
What's your background?
Speaker 2 (16:10):
I have spent well.
Well, I was a career banker, um, and as part of that I probably
spent the first half of mycareer in sales and supporting
businesses from a lending and aand a product perspective.
And then, uh there, theanti-money laundering
(16:30):
legislation came in and Istarted my journey into risk,
risk governance and compliance,and I've been doing that for the
better part of the last 10years and it's sort of one of
those things sometimes yourfront office and other times
your back office or middleoffice and it's that journey of
(16:52):
the career.
You go where there'sinteresting work, and I often
think there is interesting workin the financial crime and fraud
space.
It's a big risk to a lot ofbusinesses.
It's often in the media.
You might not see it as blackand white like the legislation,
(17:15):
but the news is full offinancial crime and fraud and
different types of articles likethat.
Speaker 1 (17:26):
Tim Burke, the
director of ACT AML.
Thank you so much for joiningme here on the Canberra Business
Podcast.
I guess, just to round this offfor listeners who might just be
catching up here, big changescoming to anti-money laundering
rules, particularly for lawyers,real estate agents, financial
(17:47):
services providers, accountantsand things like that.
Two key dates 31 March forexisting businesses that need to
report and 30 June 2026 foreveryone else.
So if people need moreinformation, where do they go?
Speaker 2 (18:01):
I'd reach out on
email.
My email address iswwwactamlcomau.
Send us a note or reach out.
Happy to have a chat and seehow we can help.
There is also great material onthe Austrac website, and I'd
(18:23):
also be contacting your localindustry bodies, who have a lot
of information in this space aswell.
Speaker 1 (18:32):
Well.
Tim Burke, thank you so muchfor taking the time to speak to
us today.
It's been really interestingand I think there's a whole lot
of things that many businesseswill need to be thinking about
ahead of next year when thesenew anti-money laundering rules
come into place.
I'm Greg Harford from theCanberra Business Chamber.
I've been speaking to Tim Burkefrom ACT AML.
Thank you so much for joiningus today and don't forget to
(18:54):
follow us on your favouritepodcast platform for future
episodes of the CanberraBusiness Podcast.
We'll catch you next time you.