How the Abbott Government’s ‘anti-fraud’ program has ‘been a disaster’
Labor’s anti-filing program for the government’s economic recovery program is set to be thrown into turmoil after a number of high-profile financial firms have withdrawn from the program.
The withdrawal from the scheme comes as the Government prepares to introduce legislation to repeal the program that will give the Treasury more leeway to use its powers.
Under the Government’s program, the Treasurer, Scott Morrison, will be able to apply for and use an extra $3.4 billion to help the banking sector recover from the global financial crisis.
“A number of banks have indicated they may no longer provide services to clients in Australia,” Mr Morrison said in a statement to the ABC on Thursday.
“They have also indicated that they may seek to withdraw their services from Australia,” he said.
“The Government has not made a decision to withdraw from the anti-financial crime (AFC) program, but is working with the banks and the financial sector to provide clarity.”
Mr Morrison’s announcement comes as Finance Minister Mathias Cormann is preparing legislation to overturn the Coalition’s antifiling scheme, known as ASIC’s Anti‑Money Laundering Act, which has resulted in the closure of banks across Australia.
Mr Morrison told reporters on Thursday that the Government had taken a number inroads with the industry.
“We have made progress in the past 24 hours and I’m very encouraged by that progress,” he told reporters in Canberra.
There are a number who are looking to exit Australia. “
It’s a very challenging time for financial services.
There are a number who are looking to exit Australia.
There is a number that are looking for opportunities elsewhere.”
The Treasury is expected to release legislation in the coming weeks to repeal ASIC’s anti‑filing system, known colloquially as the “anti-money laundering act”.
The legislation will see the Government give banks the right to withdraw up to $300 million from their balance sheets and apply it to the recovery of a $300,000 loan made by a company to a Commonwealth-regulated financial institution, which can then be used for the company’s own repayment.
But the Government has yet to release any details of how the legislation will work.
“This is a complex issue and it’s going to require a lot of time and consultation,” Mr Cormann said.
Mr Corman told reporters the Government would continue to work with the banking industry on the recovery process.
“Our focus is on providing a financial system that works for everyone, and that will mean keeping our rules around counter-money, counter-terrorism and the counter-dealing of proceeds from crime,” he added.
“These are complex matters, and I have to acknowledge that we’re not there yet.”
Opposition Leader Bill Shorten said the Treasurer’s move was an attempt to appease the banking lobby.
“He’s going out of his way to appease his business lobby,” Mr Shorten told reporters.
“But he has been talking up the anti‑money laundering bill for weeks now and the banks don’t want that.”
He’s not being helpful, he’s not listening to the bankers.
He’s making his own rules.
“Mr Shortens comments come amid an ongoing investigation into whether the Treasurer and Finance Minister were involved in an attempt by the banks to block ASIC’s investigation into the financial crisis, a move the Opposition has said was in the interests of the Government.
Mr Morrison has been given an opportunity to clarify his position, but he’s still refusing to do it,” Mr Smith said.