Some WA entities not meeting AML requirements

A review by Western Australia’s Auditor General has found that not all state government entities are complying with their obligations under anti-money laundering and counter-terrorism requirements.

In tabling its Compliance Frameworks for Anti-Money Laundering and Counter-Terrorism Financing Obligations limited assurance review, the Auditor General noted that six entities had deficiencies with respect to mandatory reporting and due diligence measures.

The Auditor General, Ms Caroline Spencer, pointed out that “recent high-profile matters exposing significant control deficiencies in the banking and gambling sectors led my Office to consider the potential exposure of State government entities”.

Ms Spencer said the review “provides a barometer” on the “standard of anti-money laundering and counter-terrorism financing compliance programs” at the eight state government entities encompassed by the review, that are required to fulfil obligations under the Anti-Money Laundering and Counter-Terrorism Financial Act 2006.

The Auditor General made 18 findings and suggested three improvement opportunities across six entities to ensure they comply with Commonwealth legislation requirements.

For instance, the review found that one entity was completely unaware that the types of transactions it was conducting were covered by the Act and needed to be reported to AUSTRAC.

Another entity did not have appropriate controls in place for screening and re-screening potential and current employees.

A further two agencies had not fully fixed issues raised following earlier reviews by, or directions from, AUSTRAC.

“Non-compliance and failing to adequately mitigate the risk of receiving, transferring and storing funds that facilitate serious crimes could result in significant reputational damage and financial consequences for the State,” Ms Spencer said.

‘As highlighted by recent public inquiries considering anti-money laundering and counter-terrorism financing compliance matters, senior executives, boards and ministers will continue to be important to maintaining oversight of improvements made to address identified weaknesses and meet evolving expectations of this regulatory framework.”

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