Tax Alert - New financial crime regulations start from 1 July 2026 – is your business going to be regulated?

Lowe Lippmann Chartered Accountants

New financial crime regulations start from 1 July 2026 – is your business going to be regulated?


The Federal Government is introducing new financial crime regulation from 1 July 2026.


The Anti-Money Laundering and Counter Terrorism Financing (AML/CTF) regime will expand its scope to include a new cohort of higher‑risk services and providers, commonly described as “Tranche 2 entities”.


For the last 30 years, the Australian Transaction Reports and Analysis Centre (AUSTRAC) has regulated businesses in the financial services and gambling sectors, like banks and casinos.


As money laundering methods becomes increasingly sophisticated and fast-moving, AUSTRAC is expanding their regulation to include services provided by high-risk sectors that work on the front line of high value transactions.

What industries are included within Tranche 2?


Tranche 2 entities will include those operating within the following industries:

  • real estate professionals – such as real estate agents, buyer's agents and property developers;
  • dealers in precious stones, metals and products;
  • lawyers;
  • conveyancers;
  • accountants; and
  • trust and company service providers.


In addition, virtual asset-related services (ie. cryptocurrencies exchanges) will also come under AML/CTF law from 31 March 2026.


The precise scope of the AML/CTF depends on which services provided in the above industries are “designated services” under the legislation with a geographical link to Australia. Common triggers include; handling client money, facilitating property transactions, establishing or administering legal entities and providing corporate trustee or nominee services.


Criminals often exploit businesses in these industries to hide or clean (money launder) their criminal proceeds, and it is now important that Tranche 2 entities are included to help disrupt these activities.


What should affected Tranche 2 entities do before 1 July 2026?


  1. Check the AUSTRAC website (click here) to confirm if your business is affected.
  2. Subscribe to updates from AUSTRAC (click here) for the latest information for the AML/CTF rules.
  3. Enrol and register (if affected) with AUSTRAC (click here) and obtain reporting entity status; early enrolment reduces last‑minute pressure and allows staging of compliance activities.
  4. If your business provides any of the newly regulated virtual asset services or intermediary transfer message services, these new laws start 31 March 2026 – enrolment would be required before 28 April 2026.
  5. If you provide any other newly regulated designated services, the new laws start on 1 July 2026 – enrolment would be required before 29 July 2026.
  6. Perform a risk assessment by mapping the business services, clients and delivery channels to identify where AML/CTF risks arise and what controls are proportionate. See AUSTRAC website here and also here.
  7. Develop and maintain a tailored AML/CTF program which is a comprehensive, risk-based framework with components including; appointing a dedicated compliance officer, conducting regular risk assessments, training all staff, and meticulously maintaining records. See AUSTRAC website here and also here.
  8. Conduct customer due diligence, upgrade client intake and know your customer (KYC) processes by implementing identity verification, beneficial ownership checks and changes to trust/account opening workflows. See AUSTRAC website here and also here.
  9. Provide training for your staff so they understand their obligations, and conduct personnel due diligence (testing) to assess their knowledge for identifying suspicious matters. See AUSTRAC website here and also here.
  10. Evaluate software for ongoing monitoring, screening and secure recordkeeping. If using external providers, ensure contractual obligations support compliance and data access for reporting.


After 1 July 2026 passes, many of these obligations will be a continual requirement to frequently review, and adapt where necessary if the services of your business change over time.

The extent of the impact, and associated regulatory burden caused by the AML/CTF regime, on your business will depend on the services you provide with your business. In other words, each business will have a bespoke obligation and there is no “one-size-fits-all” solution available.


If your business falls within the Tranche 2 industries, there is a significant amount of information to familiarise yourself with to prepare for the AML/CTF obligations before 1 July 2026.


In the short term, in addition to subscribing to updates from AUSTRAC, we recommend seeking out guidance from your industry body. Each industry will have its own special services and specific risks that may be impacted by these rules.


From our own experience, the accounting industry bodies we are associated with expect to provide us with some assistance and further guidance for preparing our AML/CTF program, which will be bespoke to our industry. We anticipate (and hope) your industry bodies will be providing similar guidance.


We will continue to monitor updates from AUSTRAC and will share any significant information.


Please do not hesitate to contact your Lowe Lippmann Relationship Partner if you wish to discuss any of these matters further.

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