Afterpay may cancel share purchase plan

Afterpay Touch has deferred and could cancel a $30 million share purchase plan until the completion of a regulator-mandated probe into its anti-money laundering and terrorism financing compliance.

The buy now, pay later firm on Wednesday said it has given AUSTRAC details of three external candidates to conduct an audit ordered by the federal financial intelligence agency.

It added that it will defer the share purchase plan component of a $330 million capital raising until it has considered any recommendations stemming from the audit.

"The board reserves the right to not proceed with the SPP if it considers it inappropriate to do so," Afterpay said in a statement to the ASX.

Co-founders Anthony Eisen and Nick Molnar, who remain Afterpay's largest shareholders with a 22.5 per cent holding each, have also promised not to sell any shares at least until FY21.

Afterpay shares rose on the announcement and were on course for a seventh straight session of gains.

The stock was 2.4 per cent higher at $26.34 at 1105 AEST and has now clawed back most of the 30 per cent retracement since hitting an all-time high $28.70 on May 7.

AUSTRAC ordered Afterpay two weeks ago to hire an external auditor to probe its compliance with anti-money laundering and terrorism financing law, threatening unspecified action if the firm wasn't taking it seriously.

AUSTRAC's concerns specifically revolve around the identification and verification of customers, its suspicious matter reporting obligations and its governance and oversight of decisions related to its anti-money laundering and counter-terrorism financing framework.

Austrlaian Associated PressBack to Breaking News

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