The Anti-Money Laundering and Counter-Terrorism Financing Amendment Bill 2024 was passed by both Houses of Parliament on 29 November 2024 and is awaiting Royal Assent. Background.

UPDATE: The Act was given Royal Assent on 10 December 2024. 

The Bill:

• Expands the AML/CTF regime to certain high-risk services provided by lawyers, conveyancers, accountants, trust and company service providers, real estate professionals, and dealers in precious metals and stones – also known as ‘tranche 2’ entities;
• Simplifies the AML/CTF regime for current regulated entities (including the tipping of offence);
• Modernises the regime to reflect changing business structures, technologies and illicit financing methodologies (including replacing “digital currency” with “virtual assets” and replacing “designated remittance services” with “value transfer chain”).

Most of the changes (including Tranche 2) will commence on 31 March 2026 but the changes to the “tipping off” offence will commence on 31 March 2025.

The next step is for Austrac to publish draft operational rules which will be finalised before March 2026.

New regulated (Tranche 2) entities

Amendments made to the Bill as passed include:

• While the new designated services include real estate professional services the definition of real estate now excludes leases of 30 years or less (previously 20 years in the draft Bill);
• a service is not a designated service if the service is provided by a person in the course of legal practice as a barrister on the instructions of a solicitor, if the instructions are given in connection with the provision of a designated service;
• assisting a person in a real estate transaction is not a designated service if it is done pursuant to a court or tribunal order.

There will be no general exemption for small businesses.

Changes for existing and new regulated entities

• The tipping off prohibition now only applies to disclosing or sharing relevant information where that could reasonably prejudice an investigation into an offence.

• Existing reporting entities will need to review and update their AML/CTF program to reflect a new definition: an AML/CTF program is now defined as comprising of a risk assessment and required policies.

• All reporting entities will be required to undertake risk assessments of ML/TF/proliferation financing.

• The governing body of a reporting entity will also have specific obligations to ensure compliance with AML/CTF programs.

• Reporting entities that are AFSL holders that only provide item 54 designated services (for example, financial planners) will retain their exemption from certain AML/CTF program obligations. These reporting entities are only required to undertake an AML/TF risk assessment, and develop and implement AML/CTF policies that deal with how the reporting entity undertakes initial Customer Due Diligence. They will be exempt from exemption from ongoing Customer Due Diligence.

• Any business that provides a designated service in addition to providing an item 54 service must comply with the full range of AML/CTF obligations for those services.

• AUSTRAC has been given new information gathering powers.

If you found this article helpful, then subscribe to our news emails to keep up to date and look at our video courses for in-depth training. Use the search box at the top right of this page or the categories list on the right hand side of this page to check for other articles on the same or related matters.