Australia: Anti Money Laundering & Counter Terrorism Financing (AML\CTF)

Who is affected: Accountants providing designated services (e.g. managing client funds, establishing companies or trusts, facilitating financial transactions) will be classified as reporting entities under the AML/CTF Act.

‍

Registration & enrolment:

• Must enroll with AUSTRAC within 28 days of providing a designated service.

• Registration opens 31 March 2026; compliance is mandatory from 1 July 2026.

‍

AML/CTF Program:

• Develop and maintain a tailored AML/CTF compliance program.

• Must include:

• Risk assessment of money laundering and terrorism financing (ML/TF) threats.

• Policies and procedures to mitigate identified risks.

• Appointment of a compliance officer.

• Staff training on AML/CTF obligations.

• Independent review of the program at least every 3 years.

‍‍

Customer Due Diligence (CDD):

• Initial CDD: Verify customer identity before providing services.

• Ongoing CDD: Monitor transactions and update customer profiles.

• Enhanced CDD: Required for high-risk clients (e.g. politically exposed persons).

• Simplified CDD: May apply to low-risk clients.

‍

Reporting obligations:

• Suspicious Matter Reports (SMRs): Submit within 24 hours of forming a suspicion.

• Threshold Transaction Reports (TTRs): Required for cash transactions ≥ AUD 10,000.

• International Funds Transfer Instructions (IFTIs): Report cross-border transfers.

• Annual Compliance Reports: Summaries AML/CTF compliance activities.

• Record-keeping:

• Maintain records of CDD, transactions, and AML/CTF compliance for at least 7 years.

• Legal professional privilege:

• Protections remain in place for information subject to legal professional privilege. ‍
• Third-party reliance:

• Accountants may rely on third parties for CDD but must ensure compliance and access to records.

• Transitional provisions:

• Existing clients (pre-commencement) are exempt from CDD unless risk profile changes or a suspicious matter arises.

• Penalties for non-compliance:

• Civil penalties, enforceable undertakings, and possible suspension of registration for serious breaches.

‍

Reference/Citation

Summary of AML/CTF obligations for tranche 2 entities | Australian Government AUSTRAC -

https://www.austrac.gov.au/about-us/amlctf-reform/summary-amlctf-obligations-tranche-2-entities

‍