Chris Ellison (WA, Liberal Party, Minister for Justice and Customs) Share this | Hansard source

With regard to the more general issue that Senator Ludwig mentioned in relation to the transactions between banks where you have an intermediary, suggestions were made by the Australian Bankers Association which were taken on board. I understand that the private sector was consulted in relation to the wording of this bill, and I think that that covers what Senator Ludwig has said. Other countries, such as the United States and the United Kingdom, have been dealing with the same issues we have and are in the process of implementing their responses to the 40 recommendations from FATF, plus the nine special recommendations.

In a visit recently to London and Washington it was made very clear to me that they also regarded this as very much a continual work in progress and that you would never reach a specific point in time where you could rule a line through things. The complexity of it is demanding, and that is why we have gone very carefully with the private sector. I have said repeatedly that we do not want to render the financial sector of Australia uncompetitive because of inappropriate regulation. We do not want to burden that sector with such regulation and red tape that internationally we are not competitive. They work in a very global environment, if I can put it that way, and it is essential, therefore, that we achieve a balance between security needs, on the one hand, and the needs of the private sector, on the other.

To give you an example of one of the things that FATF requires, and one of the issues that we are dealing with: for credit card transactions FATF requires the full details of the customer and the number. On the one hand, this sounds like a good suggestion, and there are security aspects to it, but, on the other hand, does it really achieve that which it sets out to? We have said—and you have seen this recently with changes to credit card details—that when you get a receipt your full number is not on it for security reasons: so that people cannot hack into your credit card and commit credit fraud. One of the things I would say when somebody comes along and says, ‘This is what you’ve got to do,’ is that you have to go a bit further and see what ramifications there may be in providing the full details. Are you exposing the cardholder to possible fraud by doing that? That is just one very small aspect of what is a very big area of reform, and that is something we are taking up with FATF, for instance. FATF has suggested that and said that that is a good way to go. I think we need to have a good look at that and make sure that it is the best way to go, because it could have the reverse effect by publishing the details in such a fashion that a person’s identity could be stolen.