The AML/CTF Amendment Bill 2024 amending the AML/CTF Act passed Parliament on 29 November 2024. The new laws are designed to detect money laundering, terrorism financing and proliferation financing. AUSTRAC (https://www.austrac.gov.au/) will now regulate tranche 2 businesses which provide certain designated services and will include professional service providers such as accountants, lawyers, conveyancers, and trust and company service providers. 

To identify whether you will be regulated – you can use AUSTRAC’s online tool.

Here’s a closer look at what the AML/CTF reforms mean for these businesses:

Compliance Requirements

All businesses will need to implement new compliance measures to meet the AML/CTF regulations. This will include:

• Initial and Ongoing Customer Due Diligence: Collect and verify information on clients and business entities and monitor transactions for suspicious activity.

• Record Keeping: Maintaining detailed records of transactions and customer information.

• Reporting Obligations: Reporting suspicious transactions to AUSTRAC.

Costs and Resources

Implementing these compliance measures may involve additional costs and resources, such as:

• Training: Staff will need training to understand and comply with the new regulations. A compliance officer will need to be appointed by the business and pass the “fit and proper person” test to act as a contact point for the AML/CTF policy.

• Technology: Investment in software and systems to collect and verify identity, monitor transactions, and maintain records.

• Consultation: Potential need for legal or compliance consultants to ensure adherence to the new rules.

• Ongoing compliance appointments.

Benefits

While there are costs, there are also potential benefits:

• Enhanced Security: Improved measures can protect businesses from being exploited for money laundering or terrorism financing.

• Reputation: Compliance with international standards will enhance both Australian business’s reputation and trustworthiness and therefore your own.

• Australian authorities at Federal, Territorial, and State levels can use the data they receive from AUSTRAC as intelligence and evidence.

Flexibility and Support

The Bill simplifies and clarifies the AML/CTF regime, which will help reduce the regulatory burden:

• Simplified Processes: Clearer guidelines and streamlined processes will make compliance easier.

• Support from Authorities: Government agencies will provide resources (eg AML/CTF starter program kits) and support to help small businesses comply.

Conclusion

Overall, while the passing of the AML/CTF Amendment Bill 2024 will require small businesses to adapt and potentially incur additional costs, it also offers benefits in terms of security and reputation. The simplified framework and support from authorities should help mitigate some of the challenges.

If you have any specific concerns or need more detailed information, further details can be found at https://www.austrac.gov.au/about-us/amlctf-reform/check-if-youll-be-regulated  or feel free to email hello@verifime.com