What are Money mule accounts? Australia’s financial intelligence regulator targets financial crime vulnerabilities in foreign-owned banks

AUSTRAC (Australian Transaction Reports and Analysis Centre) has carried out two supervisory campaigns into foreign-owned banks in Australia, discovering weaknesses in controls and reporting across branches and subsidiaries AUSTRAC is Australia’s financial intelligence unit and anti-money laundering/counter-terrorism financing (AML/CTF) regulator.

The reviews examined low levels of reporting of suspicious activity in foreign bank branches and money-mule risks in foreign bank subsidiaries, reflecting different business models and risk profiles across the sector.

Among the two campaigns, one focused on foreign bank branches operating in Australia. The government agency found that many institutions had settled on the view that their businesses carry limited money-laundering risk, but said that assessment did not align with the exposure it observed in parts of their operations.


On the other hand, the second campaign examined six foreign bank subsidiaries in the country and discovered a very high degree of exposure to money mules. It is pertinent to note that these subsidiaries are separately incorporated in Australia unlike branches and offer retail banking services to millions of customers.

What are Money mule accounts?

According to the Federal Bureau of Investigation, a money mule is someone who transfers or moves illegally obtained funds on behalf of others. Criminal networks recruit such individuals to launder proceeds from online scams, fraud, and crimes including human trafficking and drug trafficking.

These mule accounts are then used to channel money through unrelated individuals to evade detection—a practice that remains widespread globally and continues to facilitate the movement of proceeds from various criminal activities.

Money mules add layers of distance between crime victims and criminals, which makes it harder for law enforcement to accurately trace money trails. Money mules can move funds in various ways, including through bank accounts, cashier’s checks, virtual currency, prepaid debit cards, or money service businesses.

Some money mules know they are supporting criminal enterprises; others are unaware that they are helping criminals profit. Money mules often receive a commission for their service, or they might provide assistance because they believe they have a trusting or romantic relationship with the individual who is asking for help.


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Money mules create layers of separation between victims and criminals, making it more difficult for law enforcement to trace the flow of funds. They move money through various channels, including bank accounts, cashier’s checks, virtual currencies, prepaid debit cards, and money service businesses.

While some mules knowingly support criminal operations, others are unaware of their involvement. They may receive a commission for their role or act out of trust, including in cases where they believe they are in a genuine or romantic relationship with the person requesting assistance.