Cointree hit with AUSTRAC fine

AUSTRAC has hit crypto exchange Cointree with a $75,120 infringement notice over alleged failures to submit suspicious matter reports (SMRs) to AUSTRAC on time.

The action comes after Cointree voluntarily disclosed it had not met the reporting timeframes required by the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (AML/CTF Act).

AUSTRAC chief executive Brendan Thomas said that failing to submit SMRs on time denied AUSTRAC and its law enforcement partners the opportunity to act on the information in a timely manner.

"SMRs provide AUSTRAC and our law enforcement partners with information about suspected misuse of the financial system and this information goes on to trigger countless criminal investigations each year," Thomas said.

"We take timely SMR reporting seriously because these reports form the backbone of our intelligence function.

"We need to action these reports as soon as possible, which is why the timeframes are put in place - they allow us to move with pace and alert our partners to suspected criminal conduct."

Thomas acknowledged that Cointree fully cooperated with AUSTRAC in self-disclosing the breaches and said the exchange was taking proactive steps to remediate its systems and controls.

"Without these steps, Cointree may have been subject to a much more serious regulatory response," he said.

In 2024, AUSTRAC released the Money Laundering in Australia National Risk Assessment which identified the digital currency exchange (DCE) sector as being vulnerable to money laundering due to its speed, global reach, pseudonymity and ability to facilitate funds flows to and from foreign jurisdictions with low visibility.

"The DCE sector is undergoing rapid growth, and we have significant concerns about some DCE's capacity for and commitment to AML/CTF compliance," Thomas said.

"Addressing heightened risk in the sector is a regulatory priority for AUSTRAC and we are focusing on DCE compliance across 2025."

AUSTRAC said Cointree has paid the amount in full and acknowledged that payment does not constitute an admission of liability.