⚡ Direct Answer: Australia’s AML/CTF reforms — passed as the Anti-Money Laundering and Counter-Terrorism Financing Amendment Act 2024 — are the most significant update to the regime since the original Act in 2006. The reforms expand the AML/CTF regime to include professional service providers (accountants, lawyers, real estate agents), modernise the framework, and introduce new obligations from 1 July 2026. Newly regulated businesses must apply to enrol with AUSTRAC by 29 July 2026.
Background: Why Did Australia Reform Its AML/CTF Laws?
For many years, Australia was one of only a small number of FATF (Financial Action Task Force) member countries that had not extended AML/CTF obligations to professional service providers — particularly lawyers, accountants, and real estate agents. These professions are often referred to as “gatekeeper” professions because they can facilitate — knowingly or unknowingly — access to the financial system and the movement of illicit funds.
FATF’s mutual evaluation of Australia in 2015 identified the lack of regulation of these gatekeeper professions as a significant gap in Australia’s AML/CTF regime. Subsequent FATF assessments reinforced this finding. After years of consultation and delay, Australia enacted the Amendment Act in late 2024.
Key Changes Under the 2024 Amendment Act
1. Extension to Tranche 2 Entities
The most significant change is the extension of the AML/CTF regime to “Tranche 2” entities — professional service providers who were previously unregulated. From 1 July 2026, businesses providing the following services will be subject to AML/CTF obligations:
- Accountants providing certain financial services (managing client assets, company structures, trusts)
- Lawyers and law firms providing certain legal services (conveyancing, trust and company management, asset management)
- Conveyancers
- Real estate agents (both residential and commercial, for sales and high-value leasing)
- Trust and company service providers
- Precious metals, stones, and jewellery dealers
- New categories of virtual asset service providers
2. Modernisation of the Existing Framework
The reforms also modernise the AML/CTF framework for existing reporting entities. Key changes include:
- A simplified and more flexible AML/CTF program structure, focusing on outcomes rather than prescriptive requirements
- Updated Customer Due Diligence (CDD) obligations, including a clearer framework for simplified and enhanced due diligence
- New requirements for identification and verification of beneficial ownership
- Revised record-keeping obligations
- Strengthened governance requirements, including board and senior management accountability
- Expanded provisions around reporting groups
3. Updated Reporting Obligations
The reforms update and clarify reporting obligations, including:
- Updated provisions for Suspicious Matter Reports (SMRs)
- New information to be included in reports submitted from 1 July 2026
- Strengthened provisions around the tipping off prohibition
- Expanded obligations for International Funds Transfer Instructions (IFTIs)
Who Is Affected by the 2026 Reforms?
New Reporting Entities (Tranche 2)
Businesses that will be regulated for the first time from 1 July 2026 are most significantly affected. These businesses need to:
- Determine whether they provide any of the new designated services
- Develop an AML/CTF program from scratch before 1 July 2026
- Implement customer due diligence procedures
- Establish reporting systems
- Train staff
- Enrol with AUSTRAC by 29 July 2026
Existing Reporting Entities
Businesses that are already reporting entities also need to update their AML/CTF programs and procedures to comply with the reformed Act. The reforms change certain definitions, obligations, and processes — even for long-established reporting entities. A review and update of existing programs should be completed before 1 July 2026.
The 2026 Enrolment Deadline
The key compliance date for newly regulated businesses is 29 July 2026. This is the deadline by which newly regulated entities must apply to enrol with AUSTRAC. Operating as a newly regulated reporting entity from 1 July 2026 without having enrolled is a breach of the Act from day one.
AUSTRAC has signalled that it expects newly regulated entities to prepare well in advance — not to scramble to enrol at the last minute with a bare-minimum compliance framework. Having a properly functioning AML/CTF program in place from 1 July 2026 is the expectation, not simply completing the enrolment form.
What Should Businesses Do to Prepare?
- Assess your exposure: Determine whether your business provides any of the new designated services from 1 July 2026.
- Conduct a gap analysis: Compare your current practices against what the AML/CTF Act will require.
- Conduct an ML/TF risk assessment: Your AML/CTF program must be built on a proper assessment of your specific ML/TF risks.
- Develop your AML/CTF program: Create written policies, procedures, and controls tailored to your business.
- Design CDD processes: Implement procedures for verifying customers, screening for PEPs and sanctions, and ongoing monitoring.
- Train your staff: Ensure all relevant personnel understand their obligations before 1 July 2026.
- Enrol with AUSTRAC: Submit your enrolment application in time to meet the 29 July 2026 deadline.
Frequently Asked Questions
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When do the Tranche 2 reforms take effect?
The new designated services and obligations for Tranche 2 entities commence on 1 July 2026. Newly regulated businesses must enrol with AUSTRAC by 29 July 2026.
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Do existing reporting entities need to do anything?
Yes. The reforms also update obligations for existing reporting entities. All reporting entities should review their AML/CTF programs against the updated requirements and implement any necessary changes before 1 July 2026.
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Will there be a grace period for newly regulated entities?
The Act provides for the 28-day enrolment window after commencement of a designated service. Beyond the enrolment deadline, AUSTRAC has not announced a formal grace period for compliance. The expectation is that businesses will have their compliance frameworks in place from the commencement date.
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What is FATF and why does it matter for Australian AML laws?
The Financial Action Task Force (FATF) is an inter-governmental body that sets international standards for AML/CTF compliance. Australia is a member of FATF, and the 2024 reforms were significantly driven by the need to meet FATF standards and address identified gaps from FATF’s mutual evaluation of Australia.
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