By PAUL O’DONOGHUE, Senior Correspondent
AUSTRALIA’S financial crime watchdog has ordered an external audit of Mercedes Benz Financial Services due to concerns over AML (anti-money laundering) and CTF (counter-terrorism financing).
In a statement, AUSTRAC said: “Among the concerns were serious issues such as assuming most customers were low risk, a lack of systems to identify and escalate suspicious matters, and inadequate transaction monitoring.”
The order follows a regulatory campaign targeting non-bank lenders and financiers. That campaign revealed widespread vulnerabilities to money laundering across the sector.
AUSTRAC CEO Brendan Thomas said non-bank lenders, including vehicle financiers, must ensure they meet their AML/CTF obligations.
“The outcomes of this audit will help Mercedes Benz better meet their compliance obligations and will inform us if any further regulatory action is required,” he said.
“This industry is vulnerable to money launderers and organised criminals,” he said. “We need to get better at shutting down avenues for criminals to profit from crime.”
Mercedes Benz AML concerns part of broader trend
An AUSTRAC review revealed that nearly 90% of businesses in the sector failed to submit a single suspicious matter report (SMR) in 2024. In 2023, only two businesses submitted around half of all SMRs across the industry.
“Strikingly, 89% of businesses said they had no high-risk customers at all,” Thomas said. “This needs to change… or more businesses will end up in Mercedes Benz’s position.”
He added that low reporting rates make it harder to detect and disrupt criminal activity.
“No business is devoid of risk,” he said. “We’ve shared risk information with this sector for years, yet the full picture of potential criminal exploitation remains hidden.”
Mr Thomas said some companies have already taken steps to improve compliance after AUSTRAC flagged deficiencies during the campaign.
“when we showed them their shortcomings, many were quick to action. We expect this to occur more broadly across the sector,” he said.
AUSTRAC plans to monitor SMR submissions to track how the sector responds.
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