Anti Money Laundering Using Orion to activate the Australian AML legislation

The AML/CTF act refers to definitions in other pieces of legislation, including the Australian Constitution It is intended that only enough of these other acts be read to flesh out the definitions

Defining Terms 5 Definitions In this Act: account includes: (a) a loan account (for example, a credit card account); and (b) an account of money held in the form of units in: (i) a cash management trust; or (ii) a trust of a kind prescribed by the AML/CTF Rules. account provider: if an account is with a person, the person is the account provider for the account. acquiring: in determining whether something is a designated service, acquiring includes anything that, under the regulations, is taken to be acquiring for the purposes of this definition. ADI (short for authorised deposit-taking institution) means: (a) a body corporate that is an ADI for the purposes of the Banking Act 1959; or (b) the Reserve Bank of Australia; or (c) a person who carries on State banking within the meaning of paragraph 51(xiii) of the Constitution. AFP member (short for Australian Federal Police member) means a member or special member of the Australian Federal Police. allowing a transaction: in determining whether a person has allowed a transaction, it is immaterial whether the person was obliged to allow the transaction. AML/CTF Rules (short for Anti-Money Laundering/Counter-Terrorism Financing Rules) means the rules made under section 191. Note the forward reference to AML/CTF, as the definitions are in alphabetical order, the use of the same term to define a term - “allow a transaction”

I before E We need to have already required the properties of an object so we can group things appropriately when defined terms are used together. Some defined terms are used before they are defined, so the machine needs to read the definitions in the order they are required, rather than the order in the document. Sometimes it will encounter circular definitions - A is defined in terms of B and C, and C is defined in terms of A (and sometimes it is acceptable). Sometimes, there will be no definition. When reading existing legislation, we will end up with a set of explanatory notes, that any reader needs, for errors or omissions.

Complex Definition (1) For the purposes of this Act, if: (a) a person (the originating entity) instructs a person (the originating institution) to transfer money controlled by the originating entity to a third person (the ultimate recipient) on the basis that the transferred money will be made available to the ultimate recipient by: (i) being credited to an account held by the ultimate recipient with a fourth person (the destination institution); or (ii) being paid to the ultimate recipient by a fourth person (the destination institution); or (b) a person (the ultimate recipient) instructs a person (the originating institution) to transfer money controlled by a third person (the originating entity) to the ultimate recipient on the basis that the transferred money will be made available to the ultimate recipient by: (i) being credited to an account held by the ultimate recipient with a fourth person (the destination institution); or (ii) being paid to the ultimate recipient by a fourth person (the destination institution); the instruction is a multiple-institution person-to-person funds transfer instruction. This is of form If A and B, C is D

Complex Definition The definition becomes complex and has multiple threads, but is exactly what the legislation says (and implies) Object being defined Multiple threads through object group

Sample Text 74 Anti-money laundering and counter-terrorism financing programs (1) An anti-money laundering and counter-terrorism financing program is a program that: (a) is designed to ensure that appropriate action is taken to: (i) identify; and (ii) materially mitigate; the risk that the provision by the reporting entity of designated services at or through a permanent establishment of the entity in Australia might (whether inadvertently or otherwise) involve or facilitate a transaction that is connected with the commission of: (iii) a money laundering offence; or (iv) a financing of terrorism offence; and (b) requires the reporting entity to monitor the provision by the reporting entity of designated services at or through a permanent establishment of the entity in Australia, with a view to: (i) identifying; and (ii) materially mitigating; the risk that the provision by the reporting entity of a designated service at or through a permanent establishment of the entity in Australia might (whether inadvertently or otherwise) involve or facilitate a transaction that is connected with the commission of: (iii) a money laundering offence; or (iv) a financing of terrorism offence; and (c) requires the reporting entity to take such action as is specified in the AML/CTF Rules in relation to the provision by the reporting entity of designated services to customers who are politically exposed persons; and (d) requires the reporting entity to take such action as is specified in the AML/CTF Rules in relation to the provision by the reporting entity of designated services at or through a permanent establishment of the entity in a foreign country;and (e) includes a system directed towards ensuring that the reporting entity complies with this Act; and (f) complies with such requirements as are: (i) specified in the AML/CTF Rules; and (ii) declared by the AML/CTF Rules to be requirements relating to ongoing customer due diligence; and (g) complies with such other requirements (if any) as are specified in the AML/CTF Rules. The terms in blue are defined terms, making it much easier to handle the text. The text is defining another term (in red), already found in formal definitions and pointing to this clause

AML/CTF Rules Much of the text is prescriptive, so it is not easily turned into simple rules. Making the text directly generate the structure used for analysis and querying ensures that meaning is not lost or corrupted in the process.