The Anti-Money Laundering & Counter-Terrorism Financing Act (“the AML Act”) identifies, mitigates and manages money laundering and terrorism financing risks through supervising and regulating financial transactions.
The AML Act provides general principles and obligations. Detailed rules are provided by the Australian Transaction Reports and Analysis Centre (“AUSTRAC”) which administers the AML Act.
Money laundering involves injecting funds from illegal activities into the legitimate financial system to disguise the source of those funds. A common example might be for a criminal to gamble stolen money in a legalised gambling system, such as at a Casino. Any winnings from the casino are ‘legitimised’ as gambling proceeds.
Terrorism financing involves direct and indirect financing of terrorist activities.
The AML Act applies to “designated services” and the “reporting entities” which provide those services. Chapter 5 of the AML/CTF rules apply to all AFSLs.
Dover is a reporting entity for the purposes of the AML Act.
As a reporting entity Dover must:
- have procedures to verify each client’s identity before providing a designated service;
- adopt and maintain an AML/CTF program;
- have an AML/CTF Compliance Manager;
- report suspicious matters to AUSTRAC as required under the AML Act; and
- exercise due diligence on an on-going basis to ensure it complies with the AML Act and all related laws and regulations.
Dover’s AML Act compliance policy
Dover requires each Adviser to identify and record the identity of each client before providing a designated service or any other service in a form that complies with the AML Act and to retain that record as part of its client records.
Dover Advisers are required to ensure they have adequately identified each client before providing any financial product advice and any other service and are required to report any suspicious behaviour to Dover. The form of the identification depends on the nature of the client relationship. Copies of driver’s licences or other third party identification are often the easiest. A fuller list of available options is included in this form, which was developed by IFSA and the FPA.
If there is a reasonable belief that the AML/CTF law may be breached the adviser must decline to act for the client and must immediately report the suspicious activity to Dover for reporting to AUSTRAC. Details of the identification process must be retained on client files.