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In October 2025, Australia's Minister for Home Affairs Tony Burke announced a proposal that should make every cash-handling remittance operator sit up and take notice. The government intends to introduce legislation giving the AUSTRAC CEO the power to restrict or prohibit certain high-risk products, services, and delivery channels used by reporting entities.
The immediate target? Crypto ATMs. But the power is drafted broadly — and in an industry where cash remains the dominant transaction method, remittance operators need to understand what this could mean for their business models.
What Was Announced
On 16 October 2025, the government announced proposed new powers that would enable the AUSTRAC CEO to take direct regulatory action against products, services, or delivery channels assessed as presenting unacceptable money laundering, terrorism financing, or proliferation financing (ML/TF/PF) risks.
This isn't a minor procedural change. As Herbert Smith Freehills noted in its February 2026 analysis, these powers "would represent a significant regulatory intervention into otherwise lawful activities and could materially impact business models in high-risk sectors."
The power would allow the AUSTRAC CEO to:
- Restrict the use of certain products, services, or delivery channels — potentially imposing conditions, transaction limits, or enhanced due diligence requirements
- Prohibit specific products or channels entirely if the ML/TF/PF risk cannot be adequately managed
Unlike existing enforcement tools (which target individual entities for compliance failures), this power targets the product or channel itself — meaning a single determination could affect an entire segment of the industry.
Why Crypto ATMs Are the First Target
AUSTRAC's Crypto Taskforce has built a compelling case against crypto ATMs. The numbers are stark:
- Six years ago, there were 23 crypto ATM machines in Australia
- Three years ago, that number had grown to 200
- By late 2024, when AUSTRAC established the Crypto Taskforce, there were 1,200
- By mid-2025, the number had risen to approximately 2,000
- An estimated 150,000 transactions occur annually, moving approximately $275 million through crypto ATMs each year
More concerning, in a sample of 90 of the most prolific crypto ATM users across Australia, AUSTRAC and its law enforcement partners found that 85 per cent were scam victims or money mules who had been tricked or coerced into moving money. Large volumes were going to wallets in high-risk jurisdictions.
Crypto ATMs present a particular risk because they allow users to convert cash into digital currency that can be sent instantly and virtually anonymously across the globe — essentially combining the anonymity of cash with the speed and reach of digital transfers.
AUSTRAC CEO Brendan Thomas indicated he would use the new power immediately once enacted, and in the meantime, the agency stepped up enforcement, carried out targeted investigations, and introduced a cap of $5,000 on cash transactions at crypto ATMs, along with stricter customer due diligence requirements.
Where the Legislation Stands
As of early 2026, the product ban power has not yet been enacted into law. Here's the timeline so far:
| Date | Development |
|---|---|
| October 2025 | Government announces proposed power |
| December 2025 | Government releases consultation paper seeking industry feedback |
| Early 2026 | Consultation period — exposure draft not yet released |
The new framework will be introduced as an amendment to the AML/CTF Act. However, the exposure draft of the legislation has not yet been published, meaning the precise scope, triggers, and safeguards of the power are still being defined.
This matters. The detail of how this power is structured — what threshold of risk triggers it, what consultation process applies, whether affected entities have appeal rights — will determine how broadly it could be applied beyond crypto ATMs.
Could Cash Remittance Be Targeted?
This is the question remittance operators should be asking. And the honest answer is: it's unlikely in the near term, but not impossible in the medium term.
Here's why the question isn't as far-fetched as it might seem:
AUSTRAC's Own Priorities Flag Cash Risk
AUSTRAC's regulatory priorities for 2025-26 explicitly call out cash as a high-risk area. The regulator notes that while the use of cash in Australia is declining, more than $100 billion remains in circulation, and cash is "highly susceptible to money laundering because it is anonymous, accessible and widely accepted."
AUSTRAC has stated it expects reporting entities with cash exposure to "adequately manage their ML/TF/PF risks" and intends to "improve the adoption of industry-accepted controls in relation to the mitigation of risks associated with cash."
Cash-Based Remittance Is Inherently High-Risk
Remittance services that accept cash deposits for international transfers combine several high-risk factors:
- Anonymity: Cash transactions are harder to trace than electronic ones
- Structuring risk: Multiple smaller cash transactions can be used to avoid reporting thresholds
- Cross-border movement: The funds ultimately move internationally, often to high-risk jurisdictions
- Customer base: Remittance services often serve populations that may be less familiar with formal financial systems, creating additional due diligence challenges
The Power Is Drafted Broadly
The proposed power isn't limited to crypto ATMs. It applies to any "high-risk products, services, and delivery channels." If the legislation is enacted in broad terms, there's nothing structurally preventing a future AUSTRAC CEO from using it to impose restrictions on cash-based remittance services — or specific aspects of them, such as cash acceptance above certain thresholds or in-person cash transfers without digital verification.
But There Are Reasons It's Unlikely Soon
Cash remittance remains a legitimate and regulated financial service used by millions of Australians. Banning or severely restricting it would have significant social and economic consequences, particularly for migrant communities who rely on cash-based transfers.
The more likely scenario is that AUSTRAC uses this power — if and when it's enacted — to target specific high-risk delivery channels or product features rather than entire service categories. For example:
- Restrictions on cash remittance transactions above a certain value without enhanced verification
- Requirements for digital identity verification for all cash-based remittance transactions
- Prohibitions on specific informal or unregistered channels that facilitate cash-based transfers
What Remittance Operators Can Do Now
Regardless of whether this power is ever used against cash remittance directly, the regulatory direction is clear: AUSTRAC wants to see better risk management around cash. Operators who get ahead of this trend will be better positioned — both from a compliance perspective and, potentially, from a commercial one.
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Review your cash handling controls. Assess whether your current procedures for accepting cash — identity verification, transaction monitoring, threshold reporting — meet AUSTRAC's expectations. The regulator has repeatedly said it wants to see "industry-accepted controls" for cash risk.
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Document your risk assessment for cash channels. Under the AML/CTF Rules 2025, your ML/TF/PF risk assessment must specifically address the risks associated with each delivery channel you use, including in-person cash acceptance. Make sure your assessment is current and thorough.
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Consider diversifying your service channels. Operators that offer both cash and digital remittance options are less exposed to potential channel-specific restrictions. If you're 100 per cent cash-dependent, now is a good time to explore digital transfer capabilities.
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Monitor the consultation process. The exposure draft of the product ban legislation will be a critical document. When it's released, review it carefully — or have your legal adviser review it — to understand the scope and potential implications for your business.
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Engage with industry bodies. If you're a member of a remittance industry association, ensure they're actively participating in the consultation process. The shape of this power will be influenced by industry feedback, and the remittance sector needs a voice at the table.
What To Watch
The key milestones to monitor are:
- Release of the exposure draft — this will reveal the precise scope of the AUSTRAC CEO's proposed power and any safeguards built into the legislation
- Parliamentary introduction and debate — the legislation will need to pass both houses of Parliament
- AUSTRAC's first use of the power — how it's applied to crypto ATMs will set a precedent for how aggressively it might be used in other sectors
- AUSTRAC's 2026-27 regulatory priorities — look for any signals about cash-based services being elevated as a priority area
The Bottom Line
The proposed product ban power is a significant expansion of AUSTRAC's regulatory toolkit. While crypto ATMs are the immediate target, the broader implications for any business that relies on high-risk delivery channels — including cash-based remittance — shouldn't be dismissed.
The operators who take this most seriously won't be the ones scrambling when restrictions are announced. They'll be the ones who have already built robust cash handling controls, diversified their service channels, and demonstrated to AUSTRAC that they take cash risk management seriously.
The best defence against a product ban is making the product safe enough that a ban isn't needed.
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