02 July 2025
3 min read
#White Collar Crime & Regulatory Investigations, #Property, Planning & Development, #Superannuation, Funds Management & Financial Services
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The second tranche of reforms to Australia’s Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (AML/CTF Act) is now underway, with major compliance obligations set to commence from 1 July 2026.
The reforms aim to deter, detect and disrupt money laundering and terrorism financing, and to bring Australia in line with global standards set by the Financial Action Task Force. The changes also expand the powers of AUSTRAC, the Australian Transaction Reports and Analysis Centre, to investigate and enforce compliance more effectively.
The new framework captures businesses providing certain ‘designated services’, including:
These businesses, if they provide a ‘designated service’, will be deemed ‘reporting entities’ from 1 July 2026 and must comply with a suite of new compliance obligations. Use AUSTRAC’s tool here to check if your business is covered by the new regime.
If your business falls within the scope of the new AML/CTF framework, you will need to:
AUSTRAC will have expanded powers to obtain information and issue civil penalties. The reforms introduce a more flexible approach to compliance, removing the need for regulatory pre-approval of AML/CTF programs, but this comes with a clear expectation that internal compliance will be proactive, robust and regularly reviewed.
While the 1 July 2026 deadline may seem distant, businesses should start preparing now to meet their obligations on time.
Begin by identifying which of your services may fall under the ‘designated services’ category, conducting a risk assessment, and drafting AML/CTF compliance policies. You should also start developing your AML/CTF compliance program and engage with your professional body and AUSTRAC for guidance.
While the core requirements apply across the board, AUSTRAC will finalise tranche 2 sector-specific guidance by the end of this year.
Entities that fail to comply face a range of enforcement options including civil penalty orders up to $33 million for businesses and $6.6 million for individuals, enforceable undertakings, infringement notices, remedial directions and, in some cases, the appointment of an external auditor to review AML/CTF compliance.
This is not just a regulatory update – it’s a shift in compliance culture that aims to close long-identified gaps in Australia’s financial crime framework. Businesses that prepare early will not only avoid regulatory pain but will also demonstrate their commitment to responsible corporate conduct in an increasingly transparent business environment.
If you have questions about how the AML/CTF regime impacts you or need support with developing your compliance program, please get in touch with our team below.
Disclaimer
The information in this article is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, we do not guarantee that the information in this article is accurate at the date it is received or that it will continue to be accurate in the future.
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