Anti-money laundering / Counter terrorism funding

Australia

Nb. All references are to the Future Law Compilation of the AML/CTF Act unless otherwise stated.

What should I be doing?

• Read CPA Australia’s October 2024 and March 2025 articles on this issue for an overview of the new regime.
• Review AUSTRAC’s dedicated AML/CTF Reform page.
• Be familiar with the information on this page.
• Follow our updates on this issue.

Overview

AML/CTF is part of Australia’s legislative regime to counter money laundering and terrorism funding activities. To understand the importance of this regime you need only look as far as Appendix B of the Victoria Police Counter Terrorism Strategy 2022 – 2025. It details 34 counter terrorism operations since 2005, including thwarting a plan to bomb the AFL Grand Final in that year.

Background

The Australian Government's Joint Committee on Law Enforcement handed down its report on financial-related crime on 7 October 2015, recommending the expansion of the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (AML/CTF Act) to cover professions, such as accountants, lawyers and real estate agents.

The Anti-Money Laundering and Counter-Terrorism Financing Amendment Bill 2024, (the Bill) comprising many of those recommendations, received royal assent in December 2024. The Bill extends the list of ‘designated services’ to include ‘professional services’ typically provided by accountants and lawyers (Table 6 of section 6 of the AML/CTF Act as it is expected to read as at 1 July 2026).

As noted in the Explanatory Memorandum to the Bill:

The reforms ensure that Australia’s AML/CTF regime meets international standards set by the Financial Action Task Force (FATF), the global financial crime body. The FATF Standards are a comprehensive framework of measures to combat money laundering, terrorist financing and proliferation financing. These standards set an international benchmark for countries to implement and adapt to their legal, administrative, and operational frameworks and financial systems. The FATF Standards are regularly revised to strengthen requirements and adapt to emerging crime trends and threats.

Subordinate legislation and guidance

Following the passage of the Bill, AUSTRAC is updating the Anti-Money Laundering and Counter-Terrorism Financing Rules Instrument 2007 (No.1), (the Rules). These Rules are subsidiary legislative instruments that provide detailed information in relation to specific requirements under the AML/CTF Act.

In addition, AUSTRAC is developing industry-specific guidance and resources, such as AML/CTF Starter Program Kits, to assist small businesses transition to the new requirements.

CPA Australia continues to participate in consultation and industry forums hosted by AUSTRAC in the development of the AML-CTF Rules and guidance.

Table 6—Professional services

As mentioned above, the Bill extends the list of ‘designated services’ to include services typically provided by accountants and lawyers These expanded designated services will be contained in a new Table 6 of section 6 of the AML/CTF Act.

It is important to remember that the AML/CTF Regime does not regulate industries, it regulates services. Therefore, it is what you do, not what you are, which is important.

The expanded designated services, referred to as ‘professional services’, are:

1. assisting a person in the planning or execution of a transaction, or otherwise acting for or on behalf of a person in a transaction, to sell, buy or otherwise transfer real estate, where:
   1. the service is provided in the course of carrying on a business; and
   2. the sale, purchase or other transfer is not pursuant to, or resulting from, an order of a court or tribunal
2. assisting a person in the planning or execution of a transaction, or otherwise acting for or on behalf of a person in a transaction, to sell, buy or otherwise transfer a body corporate or legal arrangement, where:
   1. the service is provided in the course of carrying on a business; and
   2. the sale, purchase or other transfer is not pursuant to, or resulting from, an order of a court or tribunal
3. receiving, holding and controlling (including disbursing) or managing a person’s:
   1. money; or
   2. accounts; or
   3. securities and securities accounts; or
   4. virtual assets; or
   5. other property;
   as part of assisting the person in the planning or execution of a transaction, or otherwise acting for or on behalf of a person in a transaction, in the course of carrying on a business, other than in a circumstance covered by subsection (5C), being:
   • the money, accounts, securities, securities accounts, virtual assets or other property being held or managed is payment by the person for the provision of goods or services by the business
   • both:
     • the business does not provide any designated services other than the services referred to in this item 3; and
     • the money, accounts, securities, securities accounts, virtual assets or other property being held or managed is for payments reasonably incidental to the provision by the business of a service that is not a designated service
   • the money, accounts, securities, securities accounts, virtual assets or other property being held or managed is to be received or payable under an order of a court or tribunal
   • the service provided by the business is the receipt or disbursement of a payment mentioned in subsection (5D), being:
     • a payment to or from any of the following:
       • government body
       • a court or tribunal of the Commonwealth, a State, a Territory or a foreign country;
       • a public international organisation;
       • a person who is licensed under a law of the Commonwealth, a State or a Territory to provide insurance, including self-insured licensees; or
     • a payment of a kind specified in the Rules.
   • the service is any other designated service
   • a circumstance specified in the Rules.
4. assisting a person in organising, planning or executing a transaction, or otherwise acting for or on behalf of a person in a transaction, for equity or debt financing relating to:
   1. a body corporate (or proposed body corporate); or
   2. a legal arrangement (or proposed legal arrangement);
   in the course of carrying on a business
5. selling or transferring a shelf company, in the course of carrying on a business
6. assisting a person to plan or execute, or otherwise acting on behalf of a person in, the creation or restructuring of:
   1. a body corporate (other than a corporation under the Corporations (Aboriginal and Torres Strait Islander) Act 2006); or
   2. a legal arrangement;
   in the course of carrying on a business
7. acting as, or arranging for another person to act as, any of the following, on behalf of a person (the nominator), in the course of carrying on a business:
   1. a director or secretary of a company;
   2. a power of attorney of a body corporate or legal arrangement;
   3. a partner in a partnership;
   4. a trustee of an express trust;
   5. a position in any other legal arrangement that is functionally equivalent to a position mentioned in any of the above paragraphs;
   other than in a circumstance covered by subsection (5E), being:
   • acting, or arranging for another person to act, in a fiduciary capacity pursuant to, or as a result of, an order of a court or a tribunal; or
   • acting as the trustee of a regulated debtor’s estate (within the meaning of Schedule 2 to the Bankruptcy Act 1966); or
   • a circumstance specified in the Rules.
8. acting as, or arranging for another person to act as, a nominee shareholder of a body corporate or legal arrangement, on behalf of a person (the nominator), in the course of carrying on a business
9. providing a registered office address or principal place of business address of a body corporate or legal arrangement, in the course of carrying on a business

Dates to remember

For most CPA Australia members providing any of the designated services set out in Table 6, the extended regime (Tranche 2) will commence on 31 March 2026 and apply from 1 July 2026. CPA Australia members brought into the regime under the Tranche 2 amendments should note the following dates:

New obligations

The Anti-Money Laundering (AML) and Counter Terrorism Financing (CTF) Act 2006 (AML/CTF Act) reforms and expands how the Australian Government monitors financial transactions for the purpose of deterring, preventing and detecting money laundering and terrorism financing.

The AML/CTF Act (as amended) applies to the provision of the following ‘designated services’:

• Financial services (Table 1)
• Bullion and precious metals, stones and products (Table 2)
• Gambling services (Table 3)
• Services as prescribed in the regulations (Table 4)
• Real estate services (Table 5) – 1 July 2026
• Professional services (Table 6) – 1 July 2026

The key obligations under the AML/CTF Act are:

• Enrol and register with AUSTRAC
• Develop and maintain an AML/CTF program tailored to your business
• Conduct initial and ongoing customer due diligence
• Report certain transactions and suspicious activities
• Make and keep records

Enrol and register with AUSTRAC

Enrolment and registration obligations will vary depending on the designated service(s) being provided. Members should refer to the table above.

Develop and maintain an AML/CTF program tailored to your business

The provider of designated services (‘reporting entity’) must have and comply with an AML/CTF program comprising:

• the reporting entity’s assessment of the risk of money laundering, financing of terrorism and proliferation financing that the reporting entity may reasonably face in providing its designated services, and
• the reporting entity’s AML/CTF policies to appropriately manage and mitigate those risks.

The risk assessment must be completed and up-to-date, and the policies must be developed and maintained, prior to providing designated services.

Example: A reporting entity may routinely sell or transfer shelf companies for clients. While the reporting entity itself is not involved in such activity, it is known that this designated service may be used by criminals to phoenix companies for money laundering or terrorism funding purposes. Therefore, due to the risk inherent in the designated services it provides, the reporting entity’s assessment of risk and preventative policies must reflect the risk attached to that designated service.

The AML/CTF program must be documented and approved by a senior manager of the reporting entity. It must be kept up to date to reflect significant changes to the reporting entity’s business and relevant ML/TF/PF risk products released by AUSTRAC.

The AML/CTF program must be reviewed at the intervals or with the frequency specified in the AML/CTF Rules (still under development), and in any event at least once every 3 years.

Additionally, the AML/CTF program must be independently evaluated at least once every 3 years.

Conduct initial and ongoing customer due diligence

Reporting entities must conduct initial customer due diligence (CDD) before providing a designated service to a client and ongoing customer due diligence in relation to the provision by the reporting entity of designated services. However, simplified customer due diligence may be undertaken in certain low risk circumstances as part of initial and ongoing customer due diligence.

For reporting entities entering the AML/CTF regime from 1 July 2026, customer due diligence must be completed before designated services are provided.

Report certain transactions and suspicious activities

A reporting entity may need to submit the following reports to AUSTRAC:

• Suspicious matter reports (SMR): When it is suspected, on reasonable grounds, that a person is not who they claim to be or that a matter is linked to criminal activity or proceeds of crime.
• Threshold transaction reports (TTR): For individual physical currency transactions valued at A$10,000 or higher.
• International value transfer service reports (IVTS): For all international transfers of value transactions.
• Cross border movement reports: Submit when carrying physical currency or bearer negotiable instruments payable to bearer valued at A$10,000 or higher into or out of Australia.

A reporting entity will need to submit an annual compliance report summarising how the reporting entity has met its AML/CTF obligations in the previous year.

Make and keep records

A reporting entity must keep records that are reasonably necessary to demonstrate compliance with the reporting entity’s AML/CTF obligations, which are in the English or in a form in which is readily accessible and readily convertible into writing in English.

The reporting entity must retain the records until 7 years after the record is no longer relevant to the reporting entity’s compliance with its AML/CTF obligations.

AUSTRAC Resources

AML/CTF Reform

 

New Zealand

The New Zealand Government has legislated to improve its ability to tackle money laundering and terrorism financing.

The Anti-Money Laundering and Countering Financing of Terrorism (AML/CFT) Amendment Act 2017 received royal assent on 10 August 2017. It put in place Phase 2 of New Zealand's AML/CFT laws, extending its coverage to include real estate agents, conveyancers, lawyers, accountants, and some businesses that deal in expensive goods.

From 1 October 2018, accountants who provide certain types of business services must comply with the AML/CFT Act.

You may wish to add the below statement to your email signature:

From 1 October 2018, all New Zealand accounting practices became subject to New Zealand's Anti-Money Laundering and Countering Financing of Terrorism Act 2009. Where we are required to conduct customer due diligence, this Act does not allow us to act, or continue to act, for our clients unless we have conducted that due diligence. Please see the Ministry of Justice website for more information.

The below documents may assist you in complying with the legislation in New Zealand.

DIA primary resources

• NZ Department of Internal Affairs accountants guideline

Ministry of Justice resources

• Tackling money laundering and terrorist financing