Australia's financial intelligence agency, AUSTRAC, has directed Binance Australia, the local arm of the world's largest cryptocurrency exchange, to appoint an external auditor to examine its anti-money laundering (AML) and counter-terrorism financing (CTF) controls. This decision follows the identification of "serious concerns" regarding the effectiveness of Binance's systems in preventing illicit financial activities.

AUSTRAC's concerns stem from several issues, including the limited scope of Binance Australia's latest independent review relative to its size, business offerings, and associated risks. The regulator also flagged issues such as high staff turnover, a lack of local resourcing, and weak senior management oversight within the Australian unit. These factors raise questions about the adequacy of Binance's AML/CTF governance and its ability to effectively manage financial crime risks.

Brendan Thomas, AUSTRAC's chief executive, emphasized the importance of digital currency providers implementing robust measures to prevent their platforms from being used for money laundering. He stated that while global companies may appear well-positioned to meet complex regulatory requirements, they must also understand and address local money laundering and terrorism financing risks to fulfill their AML/CTF obligations in Australia. Thomas added that systems must adapt to the regulatory requirements, not the other way around.

Binance Australia has been given 28 days to nominate external auditors, with AUSTRAC retaining the final selection authority. The appointed auditor will conduct a thorough examination of Binance's AML/CTF programs to identify weaknesses and recommend improvements.

Matt Poblocki, Binance's general manager for Australia and New Zealand, acknowledged AUSTRAC's decision and stated that the company has been engaging openly and transparently with the regulator. He affirmed Binance Australia's commitment to maintaining best-in-class compliance standards and continuously enhancing its capabilities.

This move is part of a broader effort by AUSTRAC to crack down on the crypto sector and ensure compliance with AML/CTF regulations. In June 2025, AUSTRAC imposed a A$5,000 limit on cash deposits and withdrawals from crypto ATMs. The agency is also targeting 13 remittance and digital currency exchange providers over compliance breaches and investigating 50 additional providers.

Binance has faced increased scrutiny from regulators in various countries due to concerns about its AML controls and compliance with financial regulations. In December 2024, Australia's corporate watchdog sued Binance Australia Derivatives over alleged misclassification of retail clients as wholesale clients. In late 2023, Binance's former CEO, Changpeng Zhao, pleaded guilty to violating US anti-money-laundering laws.

AUSTRAC's order for an external audit of Binance Australia's AML controls underscores the growing regulatory focus on the cryptocurrency industry and the need for exchanges to implement effective measures to prevent financial crime. The outcome of the audit and any subsequent actions taken by AUSTRAC could have significant implications for Binance's operations in Australia and its global compliance efforts.