Australia Demands Audit of Airwallex Over Compliance Concerns

Australia’s financial watchdog, AUSTRAC, has initiated an audit of Airwallex to scrutinize its adherence to anti-money laundering and counter-terrorism financing regulations. This move reflects growing concerns that the payment platform’s transaction monitoring systems may not be adequately aligned with its risk profile.

The directive was issued on Thursday by AUSTRAC, formally known as the Australian Transaction Reports and Analysis Centre. The agency has ordered Airwallex to appoint an independent auditor within 14 days. This auditor will investigate potential violations of Australia’s AML/CTF Act spanning from January 2024 through this month, focusing particularly on the company’s efforts—or lack thereof—to monitor transactions, verify customer identities, report suspicious activities, and maintain sufficient compliance oversight.

Bradley Brown, AUSTRAC’s National Manager for Regulatory Operations, signed off on the enforcement notice. He emphasized that the audit should produce its findings within 180 days, with the costs borne by Airwallex.

The core issue centers around whether Airwallex’s transaction monitoring systems are adequately tuned to detect diverse financial crimes that could exploit its platform. The audit will assess how well the company can identify fraudulent activities and transactions linked to illicit practices like drug trafficking and child exploitation.

Brendan Thomas, AUSTRAC’s CEO, expressed concerns over Airwallex’s ability to comprehend its customer base and what regulatory reporting is required. “As a global payment platform facilitating cross-border fund transfers, it’s imperative for Airwallex to have a robust understanding of the risks it faces,” he stated.

This scrutiny is not entirely new for Airwallex. The company has faced regulatory challenges before but has continued forging ahead into new markets and expanding its product offerings.

The timing of this enforcement action adds another layer of complexity. Just a day prior to AUSTRAC’s announcement, Airwallex had publicized its acquisition of Paynuri, a South Korean payment gateway operator holding vital licenses in prepaid electronic payments and foreign exchange. This deal is strategic for positioning Airwallex to cater to both Korean businesses venturing abroad and global companies entering Korea’s market.

Arnold Chan, General Manager for APAC at Airwallex, hailed this acquisition as “a pivotal milestone” in a statement issued on Tuesday. The company plans a local hiring spree—20 staff members by year-end—and aims to launch global business accounts and payment services in South Korea by 2026.

Meanwhile, buoyed by a recent Series G funding round that valued it at $8 billion—a 30% increase from previous figures—Airwallex reported substantial growth: $1.2 billion in annualized revenue and $266 billion in transaction volume as of December 2025. In Asia-Pacific alone, revenues surged by 85% year-on-year with transaction volumes climbing 71%.

AUSTRAC’s scrutiny is part of a broader pattern of regulatory actions against fintech entities in Australia. In September 2025, Revolut Australia faced a $123,000 fine for delayed compliance reports; however, Revolut had self-reported these issues and cooperated with regulators extensively.

The outcome of the audit will determine whether further regulatory measures against Airwallex are necessary. Notably undeterred by oversight challenges, Airwallex continues its aggressive expansion strategy. It recently acquired San Francisco-based startup OpenPay to rival industry giants like Stripe Billing and Recurly and secured a Dutch MiFID license to offer money market investments across Europe.

Moreover, aligning itself with high-profile partners after its funding windfall reflects ambitions beyond regulatory hurdles: an exclusive sponsorship deal with Arsenal FC signals their intent to strengthen brand visibility globally.

As these developments unfold, the fintech world awaits AUSTRAC’s findings: will they reveal shortcomings warranting further action or validate a system under swift enhancement?

The regulatory focus on Airwallex comes at a time when financial institutions globally are under increased scrutiny to tighten compliance frameworks. This is especially true for platforms handling cross-border transactions, as they are often seen as vulnerable to misuse. The company’s rapid growth, marked by its recent $8 billion valuation, underscores the importance of robust oversight mechanisms in maintaining trust and avoiding potential pitfalls.

On the ground in South Korea, Airwallex’s acquisition of Paynuri not only expands its operational footprint but also introduces new compliance challenges specific to the region. Given South Korea’s stringent financial regulations, integrating Paynuri will require meticulous attention to local laws and practices to ensure seamless operations. Arnold Chan has expressed confidence in meeting these regulatory expectations while capitalizing on the burgeoning opportunities the Korean market presents.

Airwallex’s ambitious expansion strategy is further exemplified by its recent ventures into Europe. By securing a MiFID license in the Netherlands, the company is positioning itself to offer money market investments across European markets. This strategic move not only diversifies its service offerings but also subjects it to another layer of regulatory compliance from European authorities, who have their own set of stringent standards.

The fintech firm’s ongoing global partnerships, such as its sponsorship deal with Arsenal FC, highlight a broader strategy of aligning with well-known brands to enhance visibility and credibility. These partnerships are part of Airwallex’s efforts to strengthen its brand presence worldwide amidst growing competition and regulatory demands. However, navigating these complex landscapes requires a delicate balance between innovation and adherence to compliance norms—a challenge that Airwallex must address head-on as it continues its global journey.

Airwallex’s recent maneuvers reflect its strategic focus on capturing diverse markets while navigating the regulatory landscape. The acquisition of Paynuri comes at a crucial time, as South Korea’s financial sector is opening up to more international players. This move enables Airwallex to leverage Paynuri’s established licenses, enhancing its ability to offer a comprehensive suite of financial services tailored for Korean enterprises aiming for global expansion. Arnold Chan highlighted the significance of this acquisition in positioning Airwallex as a key facilitator for cross-border commerce in Asia.

In addition to expanding its geographical footprint, Airwallex’s engagement with European markets through the Dutch MiFID license demonstrates its intent to diversify offerings beyond traditional payment services. This license allows Airwallex to engage in investment activities within Europe, potentially increasing its market share in the region. By strategically positioning itself within both Asian and European markets, Airwallex aims to mitigate regional risks and capitalize on varied economic growth opportunities.

The company’s rapid valuation increase to $8 billion, driven by a successful Series G funding round, underscores investor confidence in its growth trajectory despite regulatory challenges. This funding not only boosts Airwallex’s financial resilience but also supports its ongoing development of innovative solutions aimed at enhancing customer experiences across different jurisdictions. The backing from investors is indicative of strong market trust, even as the company faces heightened scrutiny from regulators like AUSTRAC.

However, the spotlight from AUSTRAC could influence how future expansions are perceived by stakeholders and regulators alike. As Bradley Brown from AUSTRAC emphasized the importance of robust compliance mechanisms, Airwallex will need to demonstrate significant improvements in its transaction monitoring systems and overall compliance framework. The outcomes of this audit could serve as a critical determinant for Airwallex’s operational strategies moving forward, especially in maintaining regulatory goodwill while pursuing aggressive business growth globally.