Australia’s highest-profile money-laundering regulator is preparing for significant cuts to its workforce barely a month after its financial crime fighting role was expanded to oversee tens of thousands of new businesses.
Austrac is seen as the country’s most feared financial regulator and has previously taken legal action that led to massive fines for breaches of anti-money-laundering and counter-terrorism financing laws, raising billions in government revenue.
The watchdog also monitors financial transactions through banks, casinos and an array of other businesses for potential criminal activity including money-laundering, child exploitations, terrorism financing and fraud of government programs.
On Wednesday, it signalled it was preparing to cut jobs after growth in its workforce including among staff employed on projects coming to an end.
“Consultation is under way on a number of potential organisational and workforce changes, and no final decisions have been made on structures, positions or individual outcomes,” Austrac chief executive Brendan Thomas said.
The agency did not comment on information provided to this masthead by Austrac staff that the regulator will be reducing its workforce by as much as 8 per cent to less than 800 people.
Thomas said Austrac had grown significantly in recent years to support major anti-money-laundering reforms and regulate a much larger number of businesses.
“Since 2024, our workforce has increased by more than 300 people as we built the capability needed to deliver those reforms,” he said.
“Austrac employed a range of staff on temporary projects and many of those are coming to an end. As work moves into its next phase, we are considering how we best organise our people and resources to meet our future priorities.”
Insiders not authorised to speak about the cuts due to the sensitivity of the matter have attributed the cull to a government mandate to reduce government spending, as well as the wind-back of resourcing due to the completion a transformation project.
In November last year Finance Minister Katy Gallagher confirmed the government was looking at federal public service cuts to avoid a budget blowout. Government departments and agencies were expected to save as much as 5 per cent of their costs in a move that sparked warnings of further public service job losses.
Department of Home Affairs, the federal agency that oversees Austrac, declined to comment on the matter.
Austrac is responsible for combating criminals who launder an estimated $60 billion in illicit profits in the Australian economy each year which is used to fuel further criminal activity.
Last month, the watchdog’s coverage was expanded to include real estate agents, lawyers, conveyancers, accountants and dealers in precious metals and stones.
“Bringing these sectors into the regime is about closing those gaps – putting more scrutiny on high-risk transactions and stopping dirty money at the point it enters the system,” Thomas said at the time.
“This means more eyes on the ground where we know criminal exploitation occurs, helping us detect suspicious behaviour earlier and disrupt it at scale.”
Late last year, Austrac’s anti-child abuse experts joined with eight banks to combine data and tools to identify suspected purchases of child abuse material and identified multiple suspicious payments to “vulnerable minors”.
Austrac has been one of the most high-profile government regulators with a track record of extracting record fines and settlements with some of Australia’s biggest corporations.
This includes Westpac’s $1.3 billion fine in 2020 for systemic anti-money-laundering breaches – the largest civil penalty in Australian corporate history.
The watchdog eight years ago also hit the Commonwealth Bank with a $700 million penalty for breaking anti-money-laundering and counter-terrorism financing laws, and in 2023 secured a $450 million fine for Crown Resorts for systemic money-laundering breaches.
The Federal Court is still determining an appropriate fine for casino operator Star Entertainment, which could top $400 million and could put its financially struggling business in jeopardy.
Last month, Thomas gave a speech outlining the massive challenges Austrac is facing with the volume of illicit money in the Australian economy rising sharply due to drugs and illicit tobacco.
“The challenge is not simply the scale of illicit money, but the speed at which it now moves and the creativity with which it is disguised,” he said.
“We are now seeing AI tools capable of generating entire identity ecosystems – passports, payslips, bank statements and employment histories – within minutes.”
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Colin Kruger is a senior business reporter for the Sydney Morning Herald and The Age.Connect via email.From our partners
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