Supplier Integrity Due Diligence in Public Procurement : Limiting the Criminal Risk to Australia

The potential for criminals and terrorism financiers to secure lucrative government contracts poses a risk to Australia’s anti-money laundering, anti-corruption and counter-terrorism financing objectives. This article compares the customer due diligence measures that banks are required to implement to prevent money laundering and terrorism financing with the general supplier due diligence practices and processes of key Australian government departments and agencies. It identifies various weaknesses in current procurement practices relating to standard contracts and argues that these render Australian public procurement vulnerable to criminal abuse, threaten compliance with its sanctions regime and potentially undermine the crime combating objectives of its money laundering and terrorism financing laws. The article recommends that the national interest calls for a whole-of-government approach to improve supplier due diligence in public procurement