Moneygram hit with largest fine in Austrac's history

The Australian Transaction Reports and Analysis Centre has levied its largest ever fine on one of the world's biggest remittance network providers, as a penalty for what Austrac describes as "systemic contraventions of Australia's anti-money laundering and counter-terrorism financing laws."

A copy of the infringement notice on the Austrac website shows that the remittance firm was found to have made a total of 33 alleged contraventions, although these are not specified.

As a result, MoneyGram Payment Systems has paid a A$336,600 infringement notice for providing money remittance services through unregistered remittance businesses.

This action from Austrac follows on from the penalty of $122,400, paid by MoneyGram in January under the same rules, bringing the total paid by this single remitter to 2015 to almost half a million dollars. The previous fine came after MoneyGram advised Austrac that it had provided remittance services through six affiliate businesses that were not registered with Austrac.

Both infringement notices arose from an Austrac compliance assessment in 2014.

Austrac chief executive officer Paul Jevtovic noted that the money remittance sector was "recognised internationally as being particularly vulnerable to exploitation by criminals.

"Businesses with systemic vulnerabilities, or repeated AML/CTF non-compliance, risk exploitation by criminals,  severe regulatory action from Austrac and serious reputational damage," he said.

In determining its enforcement approach in January, Austrac said it took into account the voluntary disclosure made by MoneyGram. It was not clear if that same principle applied this time as neither Austrac or MoneyGram had responded to requests for further comment by publication deadlines.

This is only fourth infringement notice issued by Austrac for contraventions of the AML/CTF Act.

The fine eclipses the previous record fine levied on the Australian business of another large global remittance provider, Ria Financial Services.

In 2013 Ria paid $225,600 for similar infringements of the AML/CTF rules.

The fourth fine under these particular rules was the relatively small amount of $10,200, levied on Australian online bookmaker ClassicBet in February for failing to apply to enrol with Austrac as a reporting entity within prescribed time limits.