ATM Loophole Fuels Illegal Tobacco Trade, Sparks Government Action

Queensland is pushing for a crackdown on private ATMs, alleging they facilitate black-market tobacco sales and money laundering. This follows revelations about the largely unregulated nature of these machines, some backed by major financial institutions, that are popping up in stores selling illicit products.

ATM Networks Aid Illicit Trade

An investigation revealed that private ATMs are being installed in stores that sell illegal tobacco products. These businesses are exploiting the machines to offer customers a convenient way to pay. Some even provide discounts to those paying with cash, thus sidestepping financial oversight.

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“The Commonwealth government should be pulling every appropriate lever to stop this criminal trade and prevent these illicit products from getting into the country in the first place,”

—Tim Nicholls, Queensland Health Minister

The excise duty on a pack of 20 cigarettes is currently $28.06, which, with GST, pushes the price up. In contrast, illicit cigarettes are openly sold in some stores for approximately $8 a pack. The Australian Border Force seized over 184 tonnes of illicit tobacco in 2022-2023 (Australian Border Force).

Government Response and Concerns

Queensland’s Health Minister, Tim Nicholls, has called on the federal government to take action to stop the illegal tobacco trade. Nicholls stated that the practice of laundering money via ATMs is alarming. His department is considering legislation targeting landlords who knowingly rent to illicit tobacco sellers.

Julian Leeser, the shadow federal attorney-general, noted that AUSTRAC had previously flagged private ATMs as a money-laundering risk. He also stated that any changes to anti-money laundering laws require thorough analysis. AUSTRAC, the nation’s financial crime watchdog, has highlighted that private ATMs are targets for criminals.

As a result, a major financial institution’s ATM company, Next Payments, claims to cooperate with authorities. The company states it proactively flags suspicious behavior to prevent money laundering.