AUSTRAC Flags AML Failures in Australia’s Expanding Crypto ATM Sector

Australia’s financial intelligence unit, AUSTRAC, has raised concerns over potential anti-money laundering lapses in the country’s rapidly growing network of cryptocurrency ATMs. The agency warned that several operators may be falling short of mandatory compliance standards, opening the door to scams and financial crime.

“AUSTRAC’s cryptocurrency taskforce has found that some crypto ATM providers may lack proper anti-money laundering and counter-terrorism (AML/CTF) checks,” the agency said in an official statement.

Under Australian law, operators of crypto ATMs—also known as crypto kiosks—are legally required to register with AUSTRAC, implement transaction monitoring, and conduct know-your-customer (KYC) protocols. However, recent developments suggest these obligations are not being consistently met.

AUSTRAC launched an internal task force in December to examine the risks of money laundering and terrorism financing associated with crypto ATMs. The agency’s CEO, Brendan Thomas, stated that the unit had uncovered “worrying trends” and indicators of illicit activity, particularly linked to fraud and scams.

Australia currently leads the Asia-Pacific region in terms of crypto ATM numbers, with installations soaring from just 23 in 2019 to around 1,600 today. Most machines allow users to deposit cash in exchange for Bitcoin, a process that AUSTRAC says must be closely monitored to prevent abuse.

The agency’s concerns mirror regulatory action taken in the UK, where unlicensed crypto ATMs have faced a strict crackdown. The UK’s Financial Conduct Authority (FCA) recently secured a four-year prison sentence for 46-year-old Olumide Osunkoya, who operated a network of unregulated machines in defiance of national rules. Although UK authorities permit crypto ATMs in theory, none have received licenses to operate legally.

Brendan Thomas emphasized that while AUSTRAC is working with the sector to improve oversight, it will not hesitate to pursue enforcement measures against those failing to comply. “We want crypto ATM providers to have strong safeguards to prevent money laundering and fraud,” he said. “We will support compliance efforts but won’t hesitate to take action against non-compliant operators.”

By fLEXI tEAM