AUSTRAC Demands Binance Audit: Global Crypto Giants Must Adapt to Local Rules

AUSTRAC, Australia’s financial intelligence agency, has mandated that Binance Australia appoint an external auditor following concerns over the cryptocurrency exchange’s anti-money laundering (AML) and counter-terrorism financing (CTF) controls. The directive, issued on August 22, follows an internal review that identified significant gaps in the adequacy of Binance’s compliance framework relative to its scale, business offerings, and associated risks. AUSTRAC cited issues such as a limited scope of independent review, high staff turnover, insufficient local staffing, and weak senior management oversight as contributing to these concerns.

Binance Australia, a unit of the global crypto exchange, is registered with AUSTRAC as a digital currency exchange provider. Despite its reputation as the world’s largest centralized crypto exchange by transaction volume, the firm faces mounting regulatory scrutiny in Australia. AUSTRAC’s National Risk Assessment 2024 highlighted the increasing vulnerability of digital currencies to criminal abuse, underscoring the need for stronger safeguards to prevent illicit activities such as money laundering and terrorism financing. According to AUSTRAC CEO Brendan Thomas, businesses operating in high-risk environments must ensure their compliance systems are robust and aligned with local regulatory requirements.

AUSTRAC emphasized that global operators like Binance must maintain rigorous customer identification, due diligence, and transaction monitoring processes. Thomas noted that businesses should not expect their multi-jurisdictional systems to override local obligations. The regulator also stressed that the capacity and risk controls of a digital currency operator must scale proportionally with the size of its operations. This expectation becomes particularly critical for global exchanges like Binance, which handle high transaction volumes and face a greater risk of being exploited by criminals.

Binance Australia has 28 days to nominate external auditors for AUSTRAC’s consideration and selection. The regulator expects the audit to provide a comprehensive assessment of the firm’s AML/CTF systems and ensure that necessary improvements are implemented. Matt Poblocki, General Manager of Binance Australia and New Zealand, acknowledged the directive as part of AUSTRAC’s supervisory measures and stated the company’s commitment to maintaining best-in-class compliance standards. However, this recent action reflects the broader regulatory pressures faced by Binance in Australia, following previous legal actions over consumer protection failures and misclassification of retail clients as wholesale clients.

The increased scrutiny comes at a challenging time for Binance, which has been under regulatory fire in multiple jurisdictions. Earlier in 2024, the Australian Securities and Investments Commission (ASIC) took legal action against Binance Australia Derivatives over alleged consumer protection violations. Binance has also faced operational limitations in the Australian market, including the forced suspension of its Australian dollar fiat services in 2023 after its payment provider, Zepto, was instructed to discontinue support. These challenges highlight the broader regulatory and operational risks faced by global crypto firms operating in a rapidly evolving compliance landscape.

Source:

[1] AUSTRAC orders audit of global crypto exchange (https://www.austrac.gov.au/news-and-media/media-release/austrac-orders-audit-global-crypto-exchange)

[2] Australia watchdog orders Binance unit to conduct audit over money laundering (https://www.reuters.com/sustainability/boards-policy-regulation/australia-watchdog-orders-binance-unit-conduct-audit-over-money-laundering-2025-08-22/)

[3] Australian Regulator Orders Audit of Binance AML Systems (https://cointelegraph.com/news/australia-orders-external-audit-of-binance-s-local-unit-over-aml-concerns)

[4] Money laundering watchdog calls in auditors at Binance (https://www.afr.com/technology/money-laundering-watchdog-calls-in-auditors-at-binance-20250822-p5mp2i)

[5] Australia orders audit of crypto trading giant Binance (https://www.france24.com/en/live-news/20250822-australia-orders-audit-of-crypto-trading-giant-binance)