Enforcement: PayPal gives undertaking to AUSTRAC
AUSTRAC has accepted an enforceable undertaking from PayPal Australia Pty Ltd.
PayPal Australia offered the enforceable undertaking to AUSTRAC’s Chief Executive Officer (CEO) as a legally binding commitment to address its breaches of Australia’s anti-money laundering and counter-terrorism financing (AML/CTF) laws.
Under Part 15 Division 7 of the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (AML/CTF Act), the AUSTRAC Chief Executive Officer (CEO) may accept enforceable undertakings.
An enforceable undertaking is a written undertaking that is enforceable in a court, given to and accepted by the AUSTRAC CEO. They are generally an alternative to civil or administrative action where there has been a contravention of the AML/CTF Act, the regulations or the AML/CTF Rules.
The AUSTRAC CEO may accept an undertaking that a person will, to comply with the AML/CTF Act, the regulations or the AML/CTF Rules:
* take specified action
* refrain from taking specified action
* take specified action towards not contravening or being likely to contravene, the AML/CTF Act, the regulations or the AML/CTF Rules in the future.
AUSTRAC determined that PayPal "does not have adequate systems in place to assess " the risk of money laundering or terrorist financing posed by a customer prior to providing a designated service, nor "systems and controls to manage its ML/TF Risk and that the systems which have been adopted by PayPal may not allow PayPal to comply fully with its reporting and other obligations."
We have previously reported, in wmlro.com and in World Money Laundering Report, on PayPay Europe's lack of understanding of the law and regulation relating to money laundering that apply to it.
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