Date of Award

2012

Degree Type

Thesis

Degree Name

Bachelor of Science (Honours)

School

School of Computer and Security Science

Faculty

Computing, Health and Science

First Advisor

Mr David Cook

Abstract

Money laundering is a persistent threat to the economic viability of every nation. However the intent behind this behaviour does not always converge with the criminality of the act. A study of 395 international university students in Australia demonstrated a prominent cultural and regional norm in South Asia to use untraceable ‘informal’ remittance systems. Under Australian legislation, the use of a non-compliant alternative or informal value transfer system (IVTS) is an act that predicates the laundering of money regardless of intent. Yet in line with a clear cultural proclivity and trust in money transfer businesses, it is evident that many ordinary people still use these systems everyday alongside criminals and terrorists.The data in this study highlights a trend of willingness in remittance staff to accept student identification as valid identification for an international money transfer. The international anti-money laundering regime is a broad-scope, top-down system, which recommends a standard format of anti-money laundering and counter-terrorism financing (AML/CTF) regulation for all at-risk sectors of a national economy. However, the abuse of globally recognised monetary transfer systems is symptomatic of the flaws in this broad approach. Australia’s Financial Intelligence Unit AUSTRAC has recognised the need for less restrictive regulation of alternative remittance business. Despite this fact, the regulation of the Australian alternative remittance sector has failed to account for the environmental, cultural, and informal heritage impact factors in this process, which has reduced the efficacy of Australia’s AML/CTF programme. A second data set suggests that regulatory inadequacies extend beyond the border, to alternative and informal systems which regularly send untraceable money to and from Australia uninhibited. The findings of this research conclude that there are eight barriers which inhibit AML/CTF compliance in alternative remittance businesses. These barriers range from cultural, environmental, and trust based networks, to commercial and regulatory opportunism.

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