[Clips] Austrac runs eye over net payments

--- begin forwarded text Delivered-To: clips@philodox.com Date: Tue, 8 Nov 2005 12:30:51 -0500 To: Philodox Clips List From: "R. A. Hettinga" Subject: [Clips] Austrac runs eye over net payments Reply-To: rah@philodox.com Sender: clips-bounces@philodox.com http://australianit.news.com.au/common/print/0,7208,17167384%5E15319%5E%5Enb... Australian IT Austrac runs eye over net payments Simon Hayes NOVEMBER 08, 2005 PAYMENTS watchdog Austrac will continue to consider whether tighter regulation is needed for the growing internet payment systems sector in light of concerns that criminals could use the gateways to launder money. Austrac director Neil Jensen told Senate Estimates that Austrac would recommend changes to the Financial Transactions Reporting Act if it felt payment systems were being used to evade cash reporting requirements. The Attorney-General's Department is considering broader changes to bring the Act up to the requirements of the Financial Action Task Force. "We will look at payment systems to see what they are and if they are caught by the existing legislation," Mr Jensen said. "If they're not, is this an issue and do we need to refer it to the Attorney-General's Department for a policy decision?" Mr Jensen said Austrac examined each payment system separately to see if it was covered by the reporting requirements in the existing legislation. PayPal, the payment system owned by internet auction giant eBay, reports suspicious transactions to Austrac, but it is not required to report all transactions of $10,000 or more because it does not accept cash and does not operate accounts. "We only monitor the transactions they provide to us, and PayPal is a cash dealer under the legislation," Mr Jensen said. "Because of the way PayPal operates it generally reports only the suspicious transactions." Mr Jensen said Austrac was monitoring the internet payment sector to see if additional legislation was needed. "We have done monitoring of payment systems that may be used across the internet and we will be doing more work on that," he said. "It is part of an ongoing strategic approach to looking at alternative systems that may be eluding, or are not caught by, the current legislation. "If we found something that we believed should be caught by the legislation, we would refer that to the Attorney-General's Department." PayPal managing director Andrew Pipolo said the company had taken additional steps to prevent fraud. "PayPal imposes an internal limit of $US10,000 ($13,600) on transactions in the PayPal system," he said. PayPal had a 0.24 per cent fraud rate, Mr Pipolo said. "Importantly, PayPal is a safe way to pay online and has very few losses because of fraud." Earlier this year Austrac warned that criminals could be operating offshore bank accounts and using credit cards to pay for goods and services in Australia, escaping reporting requirements. -- ----------------- R. A. Hettinga The Internet Bearer Underwriting Corporation http://www.ibuc.com/ 44 Farquhar Street, Boston, MA 02131 USA "... however it may deserve respect for its usefulness and antiquity, [predicting the end of the world] has not been found agreeable to experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire' _______________________________________________ Clips mailing list Clips@philodox.com http://www.philodox.com/mailman/listinfo/clips --- end forwarded text -- ----------------- R. A. Hettinga The Internet Bearer Underwriting Corporation http://www.ibuc.com/ 44 Farquhar Street, Boston, MA 02131 USA "... however it may deserve respect for its usefulness and antiquity, [predicting the end of the world] has not been found agreeable to experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire'