Anti-Money Laundering and Counter-Terrorism Financing (AML/CTF) Reform

What are the reforms? 

Australia has introduced long-awaited significant reform to the Anti-Money Laundering and Counter-Terrorism Financing regime. Anti-Money Laundering (AML) and Counter-Terrorism Financing (CTF) laws includes a set of regulations that require businesses to “know” their customers and monitor and report suspicious financial transactions. The goal is to prevent the financial system from being used for criminal activities, such as laundering money from crime or financing terrorist groups. 

Who will be affected? 

Along with bringing new entities into the regime (known as “Tranche 2 entities”), existing Reporting Entities will need to review their entire AML/CTF framework. This includes updating Programs and changing the way they perform identity verification and customer due diligence. 

What are the key changes? 

Key changes to navigate include: 

• Customer identification and verification (KYC): expanded scope of collection and tightened verification requirements 

• Changes to Enhanced Customer Due Diligence (ECDD) procedures 

• Strengthening due diligence for Politically Exposed Persons (PEPs) and High-risk customers 

• Improving ongoing Customer Due Diligence (CDD) and Program governance 

When do these changes take effect? 

Changes impacting existing Reporting Entities will take place on 31 March 2026. Obligations for Tranche 2 entities begin 1 July 2026. 

Where can I find more information? 

AUSTRAC has released detailed guidance to assist Reporting Entities to prepare for the changes, which can be found here. Further information, including Fact Sheets and sector-specific guidance is expected from the Regulator in the coming months. 

How is Automic preparing to support clients? 

To support clients, Automic is engaging with our partner BronID, to operationalise the reforms, and implement a seamless transition into the new regime for Automic clients. Bronid has published a concise summary of the changes relevant to electronic identity verification here. 

What should Automic funds clients do now? 

Navigating these reforms is complex. If you have any questions about these changes or want to discuss how Automic is preparing to support your transition, please get in touch with your Customer Success Manager.