AUSTRAC Slaps Cointree with $48K Fine for Late SMRs – Who’s Next?

Key Takeaways:

• AUSTRAC penalizes Cointree A$75,120 for missing SMR deadlines, hindering criminal fund tracing.
• Crypto exchanges must file SMRs within three days (or 24 hours for terrorism financing) or face fines.
• Australia’s purge targets over 400 inactive platforms.

In a statement released on May 16, Australia’s financial intelligence agency (AUSTRAC) has fined Melbourne-based crypto exchange Cointree A$75,120 for submitting suspicious matter reports (SMRs) after the legal deadline.

NEW: Australia's AUSTRAC fines Melbourne-based crypto exchange Cointree $75,120 for delays in submitting suspicious activity reports.

AUSTRAC said Cointree’s late filings slowed police efforts to trace criminal funds. This penalty comes shortly after Cointree informed the regulator it had failed to meet reporting timeframes due to internal workflow gaps.

According to AUSTRAC guidelines, exchanges must file an SMR within three business days when they suspect money laundering and within 24 hours for terrorism-financing concerns.

AUSTRAC chief executive Brendan Thomas welcomed the disclosure but stressed the importance of speedy filings. He stated that prompt reporting lets authorities respond swiftly and alert partners to suspected criminal activity, warning that uncooperative firms will face tougher penalties.

AUSTRAC confirmed that Cointree cooperated fully and is now fixing its systems to avoid future delays.

The exchange has settled the penalty. However, AUSTRAC noted that paying the fine does not mean Cointree admits fault; it does settle the case.

The penalty extends AUSTRAC’s broader crackdown on digital-asset platforms, which the government fully supports. Since the start of 2024, Australia’s main regulator has taken formal action against 13 exchanges and sent warning letters to more than 50 others.

The financial intelligence agency has also identified 427 registered crypto exchanges that appear inactive and may cancel their registrations.

To prevent consumers from falling for scams or deregistered companies, the regulator plans to introduce a public register listing legitimate platforms.

In a related move, Australia’s Federal Court approved ASIC’s request on April 8 to shut down 95 companies tied to pig-butchering crypto and romance scams.

Justice Stewart cited false registrations and “overwhelming” evidence, as joint liquidators found that only three firms held assets and recommended deregistration for 92.

Victims across 14 countries filed nearly 1,500 claims, reporting losses exceeding $35.8 million. ASIC says it continues to combat scams, shutting down around 130 fraudulent websites each week. So far, ASIC has closed more than 10,000 platforms to safeguard investors.

While regulators are keen on further developing the sector with clear rules, cases like AUSTRAC’s action against Cointree show they won’t hesitate to impose penalties when noncompliance is found.

For example, KuCoin, operated by Peken Global, agreed to a $297 million fine in the U.S. for operating without a money-transmitting license and having weak anti-money laundering (AML) and know-your-customer (KYC) controls.

We’re pleased to announce that KuCoin has reached a settlement with U.S. authorities, a major step forward in our journey. This milestone brings clarity to our future and strengthens our commitment to innovation, compliance, and delivering value to our 38M+ users worldwide.… pic.twitter.com/EVZI1UI4Zc

Regulators found that KuCoin failed to report suspicious activity on billions in transactions and only partially implemented KYC checks.

Similarly, the UK’s Crypto Asset Reporting Framework (CARF), set for 2027, will require firms to submit detailed user and transaction data to tax authorities. Late, incomplete, or inaccurate filings may result in steep fines. Noncompliant firms could be fined up to £300 per user.

Together, these actions illustrate a worldwide trend that regulators demand rigorous, timely compliance from crypto businesses.

Companies that neglect registration requirements, fail to flag suspicious activity, or delay reporting now face hefty fines and potential deregistration, emphasizing the industry’s shift from reactive enforcement to proactive oversight.

While fines are the most common penalty, repeated or intentional delays in filing SMRs could result in criminal liability for executives under Australia’s anti-money laundering laws. It all depends on the level of negligence or involvement by senior management.

The register is expected to increase transparency by allowing investors to easily identify compliant exchanges. However, it may also expose inactive or non-compliant firms, pushing platforms to maintain strict standards or face loss of credibility and customer trust.

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