Reporting significant cash transactions

Public news

Motor vehicle dealers who provide insurance or act as insurance intermediaries must report any:

  • significant cash transactions of A$10,000 or more (or the foreign currency equivalent)
  • suspect transactions.

Reports should be made through AUSTRAC Online. You will need an AUSTRAC account to make these reports.

Significant Cash Transaction Reports

If you are involved in a significant cash transaction of A$10,000 or more (or the foreign currency equivalent) you must submit a significant cash transaction report (SCTR). This includes receiving amounts of cash from the same customer which together amount to A$10,000 or more.

It is against the law to make a transaction in a way that enables you to avoid reporting obligations.

If the transaction involves foreign currency, you must report by the end of the day after the transaction took place. If the transaction was all in Australian currency, you have until 15 days after the day the transaction took place to report.

If you are convicted of refusing or failing to report a significant cash transaction to AUSTRAC you can face penalties of up to two years in prison. If you are convicted of knowingly giving incomplete information, you can face penalties of up to five years in prison.

Example of a significant cash transaction

Alpha Cars is a motor vehicle dealer that offers its customers motor vehicle insurance policies on behalf of Delta Insurance. This means that Alpha Cars is an insurance intermediary and a cash dealer under the Financial Transactions Reports (FTR) Act.

Mr Kappa purchased a motor vehicle from Alpha Cars and paid a deposit of A$10,000 in cash on Monday and returned the following day to pay the balance of A$15,000 in cash. Alpha Cars accepted the payments.

In this example, Alpha Cars must submit two SCTRs to AUSTRAC:

  • one for the cash deposit of A$10,000
  • another for the final cash payment of A$15,000.

Suspect Transactions Reports

You must submit a suspect transaction report (SUSTR) if you have good reasons to suspect a transaction may:

  • be relevant to tax evasion or fraud
  • be relevant to an investigation or the prosecution of an offence
  • involve the proceeds of crime
  • be part of preparations for financing a terrorism offence, or be relevant to an investigation or prosecution of a terrorism financing offence.

It is an offence to make a transaction in a way that enables you to avoid your reporting obligations.

You need to report all types of suspect transactions, whether or not physical cash is involved. Even if a suspect transaction doesn’t go ahead, you must still report it to AUSTRAC.

You must keep information about a suspect transaction report secret. It is against the law to tell anyone about the transaction that aroused your suspicion, or that you have reported it to AUSTRAC. Disclosing this information can be punishable by up to two years in prison.

You must submit a suspect transaction report to AUSTRAC as soon as possible after you become suspicious about a transaction. If your suspicions relate to terrorism financing, you should report to AUSTRAC within 24 hours. Three business days is acceptable for reporting your suspicions about other crimes.

If you are convicted of refusing or failing to submit a suspect transaction report to AUSTRAC you can face penalties of up to two years in prison. If you are convicted of knowingly giving false or incomplete information in a report, you can face penalties of up to five years in prison.

Any motor vehicle dealer, or someone acting on their behalf, who submits a suspect transaction report is immune from any legal action, suit or proceeding that relates to submitting that report. Immunity does not apply if you intentionally make a false or misleading report to AUSTRAC.

If you are asked for more information about a suspect transaction (for example transaction records or other written records) you must provide it.

It is up to you whether or not you choose to maintain a business relationship with the customer. If you decide to terminate the business relationship, you must not let anyone – including the suspect – know it was because of your suspicions, or that you reported a transaction to AUSTRAC.

You must keep the following documents for seven years:

  • financial transaction documents
  • account and signatory information.

Example of a suspect transaction

Motor vehicle dealer Alpha Cars offers its customers insurance policies on behalf of Delta Insurance. This means that Alpha Cars is both an insurance intermediary and a cash dealer under the FTR Act.

Mr G purchased a car from Alpha Cars and entered into a contract for an insurance policy with Delta Insurance. Mr G bought the car for A$25,000 and offered to pay in cash. Mr G also paid Alpha Cars A$7000 for a car insurance policy. The cash payments were made over several days in bundles of $5000 and $7000.

Mr G claimed the cash was the proceeds of his house sale, but the customer service representative noticed the notes were damaged and dirty. Mr G insisted on paying for the car with cash and was not going to go ahead if Alpha Cars didn’t agree. The customer service representative thought Mr G’s behaviour and the transaction were suspicious and submitted a suspect transaction report to AUSTRAC.

Several weeks later Mr G contacted Alpha Cars and asked them to cancel the insurance policy and refund the remaining insurance premium as a cheque. The customer service representative thought this request was also suspicious and submitted another suspect transaction report to AUSTRAC reporting this information.

If you unsure if you should be reporting, contact the WR team to assist, on 8291 2000 or at wr@mtasant.com.au.