Activity Indicators
Unusual transaction patterns, inconsistent information, or behaviour suggesting money laundering or terrorism financing.
Suspicious Activity
Suspicious Activity
Guide to suspicious activity detection and reporting in AML compliance. Learn about suspicious matter indicators, investigation, and AUSTRAC reporting obligations.
Key Information
Understanding Suspicious Activity
Suspicious activity in AML compliance refers to transactions or customer behaviour that may indicate money laundering, terrorism financing, or other financial crime. Reporting entities must have systems to detect suspicious activity and report it to AUSTRAC through suspicious matter reports (SMRs).
Detecting suspicious activity requires a combination of automated monitoring systems, staff training, and risk-based assessment. The focus is on identifying anomalies that warrant further investigation and, where grounds exist, reporting to AUSTRAC.
Suspicious Activity Components
Detection Methods
Transaction monitoring systems, staff awareness, customer screening, and anomaly detection techniques.
Alert Investigation
Reviewing flagged activity, gathering additional information, and making risk-based decisions.
Documentation
Recording investigation steps, findings, and rationale for decisions to file or not file reports.
SMR Filing
Reporting suspicious matters to AUSTRAC within required timeframes when grounds exist.
Tipping Off
Prohibitions on disclosing SMR existence or AUSTRAC information to customers.
Frequently asked questions
What is suspicious activity in AML?
Suspicious activity refers to transactions or behaviour that may indicate money laundering, terrorism financing, or other financial crime. This includes unusual patterns, inconsistent information, or activity without apparent legitimate purpose.
What triggers suspicious activity reporting?
A suspicious matter report (SMR) must be filed when there are grounds to suspect a transaction relates to money laundering, terrorism financing, a serious offence, or evasion of tax. The suspicion need not be proven, just reasonably formed.
What are common suspicious activity indicators?
Indicators include: unusual transaction patterns, structuring to avoid thresholds, inconsistent customer information, reluctance to provide ID, transactions with no apparent purpose, and activity inconsistent with known customer profile.
What happens after suspicious activity is detected?
After detection, investigate the alert, gather relevant information, document your analysis, and decide whether grounds for suspicion exist. If so, file an SMR with AUSTRAC. If not, document your reasoning for not filing.
Related resources
Suspicious Activity Detection
ARCaml helps businesses detect and investigate suspicious activity effectively.