03 Mar 2026
Australia’s AML/CTF regime: What’s changed and what’s coming in 2026?
Introduction
Australia’s laws to prevent money laundering and terrorism financing are undergoing their biggest overhaul in almost two decades. These reforms touch everything from digital assets to professional services such as law, accounting and real estate. Understanding them is now essential for businesses that handle customer funds, transfer value, or provide high-risk services.
This guide breaks down what has already changed, what’s coming soon, and what your business needs to know — explained clearly and based on official sources from the Australian government and AUSTRAC.
Why the AML/CTF reforms?
Australia’s Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (AML/CTF Act) forms the backbone of the country’s effort to stop criminals from using the financial system to launder money or finance terrorism.
The Government and AUSTRAC. Australia’s regulator and financial intelligence unit, are updating this framework to:
- Strengthen protections against Financial Crime
- Bring the law in line with global standards, and
- Capture new technologies and business models such as virtual assets
These changes are not optional. They represent new obligations under Australian law that many businesses will need to prepare for this year.
What’s already changed in 2025?
Repeal of the Financial Transaction Reports Act (FTR Act)
As of 7 January 2025, the Financial Transaction Reports Act 1988 was repealed. This law previously applied to certain cash dealers such as solicitors, sellers of travellers’ cheques, motor vehicle dealers acting as insurance intermediaries, and certain remitters. Those reporting requirements ended with the repeal.
However, these businesses may still have confidential reporting and record-keeping obligations under other laws. The repeal simply removed the separate FTR Act regime and consolidated reporting requirements under the modern AML/CTF Act.
Tipping-off laws updated
From 31 March 2025, the law on “tipping-off” changed. Previously, it could be an offence to disclose that suspicious activity was being investigated. The updated offence now focuses on information disclosures that could reasonably be expected to prejudice an investigation. This modernised approach aims to balance effective reporting with protecting investigations from compromise.
Major reforms taking effect in 2026
Australia’s reform program introduces a number of significant changes from 31 March 2026 and 1 July 2026. These will have widespread impact on both existing reporting entities and many new business sectors.
31 March 2026 | Changes for Current Reporting Entities
Existing regulated entities, such as banks, remittance providers, virtual asset service providers and others already under the AML/CTF Act, will operate under a reformed regime that includes:
1. Expanded AML/CTF obligations
The law broadens the range of virtual asset and value transfer services that attract AML/CTF obligations. This includes:
“Existing regulated entitles… will operate under a reformed regime”
- transfers of virtual assets on behalf of customers
- safekeeping or administration of virtual assets, and
- ervices connected with the offer or sale of virtual assets
- To ensure newer asset types such as stablecoins and NFTs are captured, the legislation now uses the term “virtual asset” instead of “digital currency”.
“Entities must now adopt holistic risk-based frameworks that identify and mitigate the financial crime risks they face.”
2. Stronger, risk-focused compliance programs
Rather than simply having box-tick AML programs, entities must now adopt holistic risk-based frameworks that identify and mitigate the financial crime risks they face. This includes broader risk assessments, proportionate controls, and governance over compliance roles.
3. Updated customer due diligence (CDD)
Customer due diligence, the process of identifying and verifying who your customers are, will be reframed into a more outcomes-oriented structure, clarifying when enhanced checks are needed and when simplified client checks may apply.
4. Modernising value transfer and international reporting
The regime simplifies reporting obligations associated with sending value across borders.
Existing concepts (like international funds transfer instructions) are replaced with an updated international value transfer service (IVTS) reporting model to ensure key data travels with the value, regardless of technology.
1 July 2026 — New entities come under regulation (“Tranche 2”)
This is a landmark expansion of the AML/CTF regime. From this date, a range of high-risk professional services will become reporting entities under the law including
- Real Estate Professionals & Conveyancers
- Dealers in Precious Stones & Metals
- Lawyers
- Accountants
- Trust & Company Service Providers
These sectors are recognised internationally as potential gateways for criminals to disguise and move illicit funds, which is why they are now being brought into the formal AML/CTF framework.
What this means in practice:
- These businesses must register with AUSTRAC as reporting entities
- They must implement an AML/CTF compliance program
- They must appoint a dedicated compliance officer
- Staff training, customer due diligence, and suspicious matter reporting become mandatory obligations
AUSTRAC recognises that this is new territory for many of these industries and has published regulatory expectations including starter kits and guidance materials to help entities prepare for the July 2026 commencement.
Regulatory expectations and why preparation matters
AUSTRAC’s regulatory documents emphasise that the reforms place risk management at the centre of compliance. The regulator expects entities, both existing and newly regulated, to take proactive steps now to:
- Strengthen AML/CTF systems and controls
- Show progress against implementation plans, and
- Address vulnerabilities before enforcement action becomes necessary
For newly regulated sectors, AUSTRAC notes that perfection on day one is not required — but sustained effort and honest compliance systems are expected from the start.
Looking ahead: further legislative change
Beyond these milestones, the Government is pursuing additional reforms aimed at enhancing AUSTRAC’s enforcement powers
Proposed changes under consultation in late 2025 and early 2026 include giving the regulator authority to restrict or prohibit high-risk products, services or delivery channels, and refining the definition of “financing of terrorism” to strengthen national security protections.
In Conclusion
Australia’s AML/CTF reforms represent a seismic shift in how financial and non-financial businesses manage financial crime risks. They broaden the scope of regulated entities, modernise old obligations, and embed deeper risk-based compliance expectations. Whether your business is already regulated or on the path to becoming so, these reforms are reshaping compliance obligations and require careful planning and action.
To stay compliant, businesses should be actively monitoring AUSTRAC guidance, preparing internal AML/CTF programs, and ensuring that governance, staff training and risk-based controls are in place well before the key commencement dates in March and July 2026.
This article was researched and developed by Daryl Wong, Content Developer for LexisNexis Regulatory Compliance.