AUSTRAC has released Australia’s first national risk assessment of the proliferation of weapons of mass destruction and the financing or support of these activities.
Proliferation financing is when a person makes an asset available, provides a financial service or conducts a financial transaction intended to facilitate the proliferation of weapons of mass destruction, regardless of whether the activity occurs or is attempted.
The results of this assessment have found that Australia is primarily targeted by state-based or linked procurement networks that wish to exploit a range of sectors to export restricted, sensitive or dual-use goods and knowledge. Procurement networks targeting Australia operate on behalf of Democratic People’s Republic of Korea (DPRK) and Iran, as well as other countries of proliferation concern.
The report states that the most significant proliferation financing threats facing Australia include the:
• use of Australian financial services and infrastructure to procure dual-use goods and evade sanctions
• use of Australia-based corporate structures to facilitate proliferation financing and evade sanctions
• use of Australian or third-country nationals to facilitate proliferation financing and evade sanctions
• exploitation of Australian citizens to source and export sensitive technologies and knowledge for actors of proliferation concern
• use of designated non-financial businesses and professions (DNFBPs) to facilitate proliferation financing and evade sanctions.
Procurement networks use a range of methods to help obscure their illicit activities and evade
sanctions. For example:
• using front or shell companies
• mislabelling goods
• sourcing either components or sub-components from a variety of suppliers
• using transhipment hubs to hide the ultimate destination of goods
• exporting goods just under control or reporting thresholds.
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Author: David Jacobson
Principal, Bright Corporate Law
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About David Jacobson
The information contained in this article is not legal advice. It is not to be relied upon as a full statement of the law. You should seek professional advice for your specific needs and circumstances before acting or relying on any of the content.
