Australia’s Anti-Money Laundering and Counter-Terrorism Financing (AML/CTF) regime is undergoing a significant reform. From 1 July 2026, Businesses providing designated services, known as Tranche 2 entities, will become reporting entities under AUSTRAC, including:
- Trust and company service providers (TCSPs)
- Accountants
- Legal practitioners
- Dealers in precious stones, metals and products
- Real estate professionals
This marks a major shift for Tranche 2 entities. Early preparation is critical to avoid penalties, operational disruption, and reputational risk. Use this practical checklist to get your firm compliance-ready.
Tranche 2 AML/CTF Preparation Checklist
- Determine whether your firm provides designated services
Review your business activities against AUSTRAC’s list of designated services. Many everyday services in accounting, legal, real estate, and TCSP work will now trigger reporting obligations.
Action: Work through AUSTRAC’s list of designated services for newly regulated industries. - Register with AUSTRAC as a reporting entity
Enrolment opened on 31 March 2026. You must enrol by 29 July 2026 if you provide designated services from 1 July 2026. Gather your business details, ABN, and key personnel information ahead of time.
Action: Set a reminder and complete registration promptly via AUSTRAC Online to avoid last-minute issues. - Develop and approve a risk-based AML/CTF Program
Assess your specific money laundering and terrorism financing (ML/TF) risks based on your clients, services, delivery channels, and geography. Then document policies, procedures, and controls tailored to your risk profile.
Action: Use AUSTRAC’s Program Starter Kits (available for accountants, legal professionals, conveyancers, jewellers, and other sectors) to help build a compliant, sector-specific AML/CTF program. Ensure the program is board-approved (where applicable) and regularly reviewed. - Appoint key roles and train your staff
Designate an AML/CTF Compliance Officer and deliver ongoing training so your team can identify red flags, perform customer due diligence, and meet reporting requirements.
Action: Create a training schedule and maintain records of all sessions. - Consider engaging specialist compliance technology providers
Manual processes are time-consuming and error-prone. Modern AML/CTF solutions like SentroWeb can streamline customer due diligence, ongoing monitoring, sanctions screening, PEP checks, and regulatory reporting — significantly reducing compliance burden while improving accuracy and efficiency.
Action: Assess purpose-built tools designed specifically for Tranche 2 entities in Australia. Check out SentroWeb AML/CTF Solution on how they support you to meet your obligations efficiently and cost-effectively.
Next Steps for Tranche 2 Entities for Full Compliance
Once the foundational preparation is complete, implementing and maintaining effective ongoing compliance operations are essential:
- Implement robust customer due diligence (CDD) processes
Establish clear procedures for initial and ongoing CDD, including beneficial ownership identification, verification of identity, and enhanced due diligence for higher-risk clients. - Set up screening systems and ongoing monitoring
Screen clients against sanctions, Politically Exposed Persons (PEPs), and adverse media lists, and continuously monitor their risk profiles. - Maintain record-keeping and reporting capabilities
Ensure you can maintain comprehensive records for the required period and submit reports to AUSTRAC within strict timeframes. - Report suspicious matters when required
Be prepared to identify and promptly submit Suspicious Matter Reports (SMRs) to AUSTRAC, typically within 24 hours, where a suspicion has been formed. - Conduct an independent evaluation
Arrange independent reviews or audits of your AML/CTF program at least every 3 years to ensure effectiveness and ongoing compliance.
Download the Essential Checklist for Tranche 2 AML/CTF Compliance
Conclusion
Compliance with the new AML/CTF rules is not just a regulatory requirement, it protects your business, your clients, and Australia’s financial system.
Start preparing today. Firms that act early will gain a competitive advantage through smoother operations and greater client confidence.
Ready to simplify your Tranche 2 compliance journey? Contact our team for a no-obligation compliance readiness assessment or book a personalised demo today.
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