Afterpay Shares Surge 14% Post AUSTRAC Update
Afterpay Touch Group’s share price has risen as much as 14.3% in morning trades following the release of an update related to Anti-Money Laundering and Counter-Terrorism Financing matters.
The confidential interim report of external auditor Neil Jeans has been provided to AUSTRAC, though does not provide any recommendations, as they will be left for the final report.
The investigation came about due to AUSTRAC saying in June that it had “reasonable grounds to suspect Afterpay has contravened and/or is contravening Sections 32 and 81 of the Anti-Money Laundering and Counter-Terrorism Financing Act”.
Section 32 refers to the requirement for companies to verify customers using their name and either address or date of birth using reliable and independent data from at least two separate sources, while Section 81 refers to the requirement of companies to have an anti-money laundering and counter-terrorism finance program in place.
Afterpay maintains there is no evidence of any wrongdoing, though if found guilty, could be facing a maximum penalty of up to $42 million.
“Afterpay’s systems include several features that help to control our money laundering and terrorism financing risk, including the implementation of strict spending limits,” the company told The Australian.
“Afterpay reiterates that it welcomes the opportunity to continue to work cooperatively with AUSTRAC and will approach this formal process as an opportunity to ensure that our AML/CTF compliance is robust.”
The final auditor’s report is expected to be delivered to AUSTRAC by November 23.
Afterpay intends to provide a further update once the final report is delivered to AUSTRAC.
This development saw the company’s shares climbing 5% to $33.30 as of 11am.