Privacy Commissioner comments on Anti-Money Laundering and Counter-Terrorism Financing Bill 2006

The Privacy Commissioner has released a second round of comments in relation to the second exposure draft of the proposed anti-money laundering and counter-terrorism regime.

In August 2006, the Office of the Privacy Commissioner (office) provided comments to the Attorney-General’s Department (department) in relation to the second exposure draft of the Anti-Money Laundering and Counter-Terrorism Financing Bill 2006 (draft). This second round of comments follow the office’s previous recommendations made to the department and to the Legal and Constitutional Legislation Committee Inquiry in March 2006.

The office’s key comments include:

• Designated agencies, which are defined by the draft, are allowed direct access to personal information collected to prevent money laundering and terrorism funding and are permitted to use this information for secondary purposes. In addition, the list of designated agencies can expanded through regulation. The office proposes that the department undertake a consultation process prior to the expansion of the list of designated agencies to ensure that this aspect of the draft is properly scrutinised.
• The draft contemplates that personal information collected by AUSTRAC will be passed on to state and territorial agencies. Because not all states and territories have adequate privacy protections or remedies this could result in inconsistent protection throughout Australia. In order to ensure uniform protections, the office recommends that stronger privacy protections be applied to information after it has left the control of AUSTRAC.
• The draft contemplates the retention of suspicious matter reports for a period of seven years and, in certain cases, even longer. It also precludes an individual from checking information held by the reporting entity. The office recommends that information only be retained by the reporting entity if there is a specific and clearly justified reason.
• Significant data quality issues are raised by the fact that there is no limitation on the retention of personal information in the suspicious matter database and no provision allowing individuals to access and correct any inaccurate, misleading and out-of-date information. The office suggests that if no action has been taken on suspicious matters, the related personal information be deleted after a two-year period.
• The draft compels individuals to identify themselves before engaging in a wide range of transactions. While the office recognises the deterrence value of requiring identification, it suggests that the number and range of transactions for which identification is required be circumscribed (ie not providing identification where the individual is only making enquiries, where the activity is of low value or where the amount of foreign currency exchanged is small).
• In order to contain the amount of personal information collected, the office recommends that the department revisit and amend the threshold transaction value of $10,000 and set threshold figures for certain transactions where there is currently no threshold.

For more information please contact

Name : Duncan Giles
Title : Special Counsel
Office : Sydney
Phone : +61 2 9225 5954
Fax : +61 2 9322 4000
Email : duncan.giles@freehills.com