Thousands of new businesses are about to face AML rules for the first time

Beginning on July 1^st, 2026, new Anti-Money Laundering and Counter-Terrorism Financing (AML/CTF) obligations will take effect in Australia—expanding regulations to additional professions under what is known as Tranche 2. Those affected will include lawyers, conveyancers, real estate professionals, accountants, trust and company service providers, and dealers in precious metals and stones. These businesses, which were not previously regulated, will now be designated reporting entities under AUSTRAC’s oversight and need to adopt compliance measures similar to banks and financial institutions.

Essential compliance obligations for firms

Firms subject to the expanded set of regulations will need to prepare by developing frameworks and systems to guarantee compliance. The key obligations outlined in the new regulations are focused on robust protections against risk, and ensuring thorough monitoring to prevent illicit activities.

Enroll with AUSTRAC

Businesses must enroll with AUSTRAC within 28 days of offering a regulated service with a deadline of July 29^th, 2026. Virtual Asset Service Providers (VASPs) must also register by March 31^st, 2026 and cannot provide services until AUSTRAC confirms their registration.

AML/CTF program

Entities must establish an AML/CTF program tailored to their risks, including policies, procedures, and controls. In addition, they must appoint a compliance officer and conduct reviews every three years.  

Customer Due Diligence (CDD)

Before providing services, firms must verify customer identities and monitor transaction activity on an ongoing basis. Enhanced checks are required for high-risk clients, such as politically exposed persons or those linked to high-risk jurisdictions.

Reporting

Firms must submit timely reports to AUSTRAC, including Suspicious Matter Reports (SMRs), Threshold Transaction Reports (TTRs), and Cross-Border movement Reports (CBMCRs).

Record-keeping

Businesses must keep AML/CTF records, CDD files, and transaction histories for at least seven years, ensuring they are accurate and accessible for regulatory review.

Operational implications of the expansion

These reforms will require businesses to adapt their operations, with processes such as real estate transactions, client trust accounts, and high-value services now subject to customer checks and reporting. As firms adjust, they will face new costs for compliance staff, technology, and training. While compliance may seem burdensome, those that implement strong frameworks early can gain an advantage, building client trust, streamlining processes, and reducing the risk of AUSTRAC scrutiny.

Preparing for the compliance shift

To help keep you on track and guarantee that you meet needed compliance requirements, here is a list of the key actions you must take:

• Confirm if your services fall under regulated “designated services.”
• Prepare for AUSTRAC enrollment by July 2026.
• Develop a risk-based AML/CTF program and appoint a compliance officer
• Set up customer due diligence processes for onboarding and monitoring
• Build systems for reporting suspicious and large transactions
• Invest in RegTech solutions for digital onboarding, automated screening, and transaction monitoring
• Train staff and ensure records are retained for seven years
• Plan independent reviews at least every three years

Turning regulatory change into opportunity

While the natural first reaction to additional regulations can be one of dismay, they will create numerous opportunities post their implementation. Below, we share a few key considerations.

• For firms
  Opportunity: Strong compliance systems can double as risk insights, helping firms offer advisory services like risk consulting or secure investment support.
• For compliance and outsourcing providers
  Opportunity: Rising demand for KYC/CDD support, compliance setup, and reporting—especially from smaller firms lacking in-house teams.
• For tech and regtech providers
  Opportunity: New market for AML tools, ID verification, and reporting automation. Real estate, legal, and accounting firms are now key targets.
• For industry groups
  Opportunity: Law, accounting, and real estate associations can offer shared compliance tools and training, opening doors for consulting services.

Positioning your business for success under AML/CTF rules

The Tranche 2 reforms bring new AML/CTF obligations to professions previously outside Australia’s regulatory framework. Firms that act now—by designing robust compliance systems, training staff, and embedding risk-based processes—can not only reduce regulatory exposure but also streamline operations and maintain business continuity. Beyond meeting legal requirements, early preparation creates a strategic advantage: firms can leverage compliance to build trust with clients, explore new service opportunities, and position themselves as leaders in a more transparent, accountable market.

For more information, click to read the full guidance and factsheet.