AUSTRAC (Australian Transaction Reports and Analysis Centre) is expanding its Fintel Alliance, a partnership with major financial institutions, to combat money-laundering and other financial crimes more effectively. This initiative involves pooling data from financial providers, including the big four banks, to identify criminal activities that were previously undetectable through standard reporting channels.

The Fintel Alliance gained prominence after helping to uncover a money-laundering ring in Melbourne, known as Operation Avarus-Midas, in 2023. This operation involved criminals depositing cash below the $10,000 reporting threshold at various ATMs. By collaborating with banks to analyze cash deposit data between $1,000 and $10,000, AUSTRAC identified 50 million unique data points, leading to the discovery of significant criminal networks.

AUSTRAC chief executive Brendan Thomas emphasizes that the Fintel Alliance is a "game changer," enabling access to larger datasets and diverse analytical perspectives. This collaboration helps in understanding criminal threats, assessing risks to the financial system, and identifying major criminal networks. The alliance uses information to detect scams like micro-laundering, where illicit funds are mixed with legitimate money through low-value digital transactions, and money muling, which involves overseas students selling their bank accounts to criminals.

Another threat the alliance addresses is scambling, where unlicensed gambling operators lure individuals, particularly in regional and remote Aboriginal communities, to scam websites. This collaborative approach marks a significant shift in the relationship between AUSTRAC and the companies it regulates. In the past, several financial institutions faced substantial penalties for money-laundering breaches, including Westpac ($1.3 billion fine in 2020), Commonwealth Bank ($700 million fine in 2018), and Crown ($350 million penalty in 2023).

These penalties prompted banks and casinos to strengthen their anti-money laundering units, enhancing the alliance's effectiveness. The collaboration allows companies to assess the efficacy of their controls, identify weaknesses, and mitigate the risk of money-laundering breaches. ANZ Group’s financial crime risk boss, Cassandra Hewett, notes the importance of working together to develop new tools and approaches to combat crime.

Looking ahead, AUSTRAC aims to globalize the Fintel Alliance, recognizing that most laundered money originates from international sources. Brendan Thomas stresses the need for international cooperation among governments and global banks to combat organized crime effectively.