Australia is one of the world's major money laundering countries and home to terrorist cells involved in fundraising, according to a US government report.
However, Australia fares well in the 2015 International Narcotics Control Strategy report, which praises the federal government's system to detect, prevent and prosecute money laundering.
The annual State Department report lists Australia with more than 60 other nations, including Afghanistan, Iran, Iraq, Brazil, Russia, the UK, US and China, as major money laundering countries.
A major money laundering country is defined as one whose financial institutions engage in currency transactions involving significant amounts of proceeds from international narcotics trafficking.
The report points to the Australian Crime Commission's conservative estimate that serious and organised crime costs Australia close to $15 billion each year.
"Money laundering remains a key enabler of serious and organised crime (in Australia)," the US report says.
Terrorist cells in Australia also act as fundraisers.
"Terrorism financing in Australia varies in scale and sophistication, ranging from organised fundraising by domestic cells which are part of a larger, organised international network, to funds raised by small, loosely organised, and self-directed groups," the report says.
Australia is also identified as a destination for illicit drugs and precursor chemicals.
"ContacNT originating from China is the most prevalent type of pseudoephedrine combination product found in Australia and New Zealand, which is often used for the manufacture of methamphetamine", the report says.
Although legally manufactured for domestic consumption in China, ContacNT is frequently smuggled and seized in Australia and New Zealand."
Methamphetamine, largely from China, Nigeria and Iran, and ketamine, mostly from India, are smuggled through Malaysia on the way to consumers in Thailand, Japan, Indonesia, Singapore and Australia.
Canada was also identified as a source of synthetic drugs and amphetamine-type stimulants to Asia, Europe and Australia.
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