The New Foundation: A Truly Risk Based Approach

The core principle of modern AML/CTF compliance has shifted. AUSTRAC now mandates that your entire framework be built upon a specific, documented Money Laundering and Terrorism Financing (ML/TF) Risk Assessment.

This is your most critical obligation. It requires you to systematically identify, assess, and mitigate the unique risks your business faces from your:

• Customer base and their activities
• Products and services offered
• Methods of delivery (e.g., face-to-face vs. online)
• Geographic areas of operation

This risk assessment is not a one-time task; it is a living document that informs every aspect of your compliance program.

The New Era of Regulation: The Tranche 2 Reforms

The upcoming ‘Tranche 2’ reforms will significantly expand Australia’s anti-money laundering and counter-terrorism financing (AML/CTF) regime. These reforms will extend the AML/CTF Act to cover professional ‘gatekeepers’ vulnerable to criminal exploitation, while also simplifying the framework for existing reporting entities. Commencing on 31 March 2026, these changes may require businesses to make significant operational adjustments, depending on their size and nature.

Who is being brought into the regime?

• Lawyers and Conveyancers
• Accountants
• Real Estate Agents
• Trust and Company Service Providers
• Dealers in Precious Metals and Stones

The new AML/CTF Rules are expected to be finalised in August 2025 with AUSTRAC guidance released later this year.

• December 2025: AUSTRAC will release “starter program” kits to assist small businesses.
• 31 March 2026: Enrolment with AUSTRAC opens for all new Tranche 2 entities.
• 1 July 2026: Full AML/CTF obligations commence. From this date, your business must be compliant.
• 29 July 2026: Deadline to be enrolled with AUSTRAC.

Core Compliance Obligations for All Reporting Entities

Whether you are an existing reporting entity or part of Tranche 2, your obligations are extensive and require active management.

1. Develop a Risk-Based AML/CTF Program Your program must be a dynamic framework of policies, procedures, and controls tailored to the risks you identified. The old, rigid “Part A” and “Part B” structure is being replaced by a more holistic and integrated program that is demonstrably linked to your risk assessment.

2. Appoint an AML/CTF Compliance Officer You must designate a senior manager responsible for program oversight, staff training, and acting as the primary contact for AUSTRAC.

3. Enroll with AUSTRAC All reporting entities must be enrolled with AUSTRAC before providing designated services (after the compliance date).

4. Conduct Customer Due Diligence (CDD) Often called “Know Your Customer” (KYC), you must identify and verify your customers before providing a service. The extent of this due diligence will be determined by the customer’s risk profile.

5. Report to AUSTRAC You have a legal duty to report certain activities:

• Suspicious Matter Reports (SMRs): For any activity you reasonably suspect is related to criminal activity including money laundering and terrorism financing.
• Threshold Transaction Reports (TTRs): For all transactions involving AUD $10,000 or more in physical currency.
• International Funds Transfer Instruction (IFTI) Reports.

6. Ongoing Monitoring and Record Keeping You must continuously monitor customer activity against their risk profile and keep detailed compliance records for up to seven years.

The Independent Review: Your Mandatory Compliance Health Check

All reporting entities must subject their AML/CTF program to a regular independent review. This is not optional.

What is it? A critical assessment of your program’s design and operational effectiveness, conducted by a qualified and independent professional.

Why is it important? It validates that your program is genuinely risk-based, identifies control weaknesses before they are exploited, and demonstrates strong governance to regulators.

How often? The frequency is determined by your risk level but is a recurring obligation.

How MIntegrity Delivers AML/CTF Compliance with Certainty

Navigating AUSTRAC’s requirements, especially during a period of major reform, demands specialist expertise. MIntegrity provides end-to-end services to ensure your business is protected, efficient, and fully compliant.

ML/TF Risk Assessments: We facilitate comprehensive risk assessments that provide the essential, compliant foundation for your entire framework.

Custom AML/CTF Program Development: We design and write bespoke, integrated programs that meet the new risk-based requirements and are tailored to your specific business operations.

Tranche 2 Readiness: We are actively guiding lawyers, accountants, and real estate agents through the preparation process, from initial risk assessment to program implementation, ensuring they are ready for the 1 July 2026 deadline.

Independent Reviews: Our qualified experts conduct robust independent reviews, providing your board with the assurance that your program is effective and compliant.

AUSTRAC Liaison and Support: We assist with enrolments, regulatory enquiries, and preparing for potential compliance audits.

• Industry expertise – Expert guidance on AUSTRAC compliance, AML/CTF Program & Tranche 2 reforms.
• Tailored solutions – We customise our services to meet your specific needs and regulatory obligations, ensuring the best possible outcome.
• Proactive approach – We assist you in identifying potential challenges early on, preventing unnecessary issues with regulatory compliance.
• Efficient and effective responses – We manage interactions with regulators, ensuring timely and accurate responses to any requests or queries.