On 1 July 2026, Australia’s AML/CTF regime expanded to cover real estate agents, accountants, lawyers, and other professional services businesses for the first time. If you are unsure whether these laws apply to you — this guide is the place to start.
The Short Answer
AML/CTF Tranche 2 is the extension of Australia’s Anti-Money Laundering and Counter-Terrorism Financing framework to a new group of businesses — specifically the professional services sectors that have been identified as high-risk channels for financial crime. If your business provides any of the designated services listed under the AML/CTF Act 2006, you are a reporting entity and you have obligations that commenced on 1 July 2026.
The consequences of not complying are serious. Penalties reach up to AUD $2.22 million per breach for businesses and up to AUD $6.6 million for individuals. Principals are personally liable. There is no small business exemption.
What Is Tranche 1 and Why Is Tranche 2 Different?
Australia’s AML/CTF framework has been in place since 2006 — but until 2026, it applied only to financial institutions, banks, casinos, and remittance providers. These are the Tranche 1 entities that have been subject to AUSTRAC oversight for nearly two decades.
Tranche 2 extends the same framework to a new set of industries. The reason is straightforward: international bodies including the Financial Action Task Force (FATF) have repeatedly identified Australia’s professional services sectors — particularly real estate — as high-risk channels for money laundering. Australia was one of the last FATF member countries to close this gap.
The legislation was passed in late 2024. The obligations commenced 1 July 2026. The window for preparation was approximately 18 months — and for many businesses, that window is now closed.
“Property is one of the most common vehicles for money laundering in Australia. Tranche 2 closes a gap that has existed for nearly two decades.” — AUSTRAC
Who Does Tranche 2 Apply To?
Tranche 2 applies to businesses and individuals who provide designated services. The key sectors affected are:
| Business Type | Designated Services That Trigger Obligations |
| Real Estate Agents | Selling, buying, or auctioning property on behalf of another person. Buyer’s agency services. Property development sales directly to purchasers. |
| Accountants and Bookkeepers | Providing services involving managing client funds, buying or selling businesses, managing real property, and trust and company services. |
| Lawyers and Conveyancers | Assisting clients with property transactions, managing client funds, trust and company services, and buying and selling businesses. |
| Trust and Company Service Providers | Forming companies, acting as directors or secretaries, providing registered office services, and managing trusts. |
The obligations are service-based, not business-type based. This means that even a small sole-principal real estate agency that sells one property per month is a reporting entity if that service is a designated service under the Act.
What Are the Core Obligations?
If Tranche 2 applies to your business, you have nine core obligations:
- Enrol with AUSTRAC on the Reporting Entity Roll
- Develop and maintain an AML/CTF Program Part A — your risk governance framework
- Develop and maintain an AML/CTF Program Part B — your customer identification procedures
- Conduct a formal ML/TF Risk Assessment across your business
- Perform Customer Due Diligence before providing any designated service
- Screen every client against sanctions lists and Politically Exposed Persons registers
- Report Suspicious Matters to AUSTRAC within 24 hours (terrorism) or 3 business days (other)
- Keep AML/CTF records for a minimum of 7 years
- Provide AML/CTF training to all staff — documented and acknowledged
The Critical Dates
| Date | What Happens |
| 31 March 2026 | AUSTRAC enrolment portal opens. Businesses can register as reporting entities. |
| 1 July 2026 | ALL obligations commence. Your AML/CTF program must be in place, staff trained, and CDD procedures operational. |
| 29 July 2026 | Deadline to enrol with AUSTRAC. Failure to enrol by this date is itself a breach. |
| 1 July 2027 | First annual compliance report due. AUSTRAC will expect reporting entities to demonstrate a functioning program. |
Does the Size of My Business Matter?
There is no minimum size threshold under the AML/CTF Act. A sole-principal real estate agency is subject to exactly the same obligations as a multi-office operation. The Act does allow for a risk-based approach — meaning your program should be proportionate to the actual money laundering and terrorism financing risk your business faces — but the obligation to have a program exists regardless of size.
What this means in practice: a smaller agency typically has a simpler risk profile, which means a simpler program. But “simpler” does not mean “optional.” Every reporting entity must have a documented, implemented, and maintained AML/CTF program.
What Does a Compliant AML/CTF Program Actually Include?
A complete AML/CTF program for a real estate agency includes:
- A written ML/TF Risk Assessment covering four dimensions — your customers, your services, your delivery channels, and your geographic exposure
- AML/CTF Program Part A — your governance structure, risk appetite, and the controls you use to manage risk
- AML/CTF Program Part B — step-by-step procedures for identifying and verifying clients before providing any designated service
- Compliance policies covering CDD, enhanced due diligence, sanctions screening, suspicious matter reporting, record keeping, and staff training
- Work instructions — the practical, operational guides your agents follow when a client walks in the door
- Forms and registers — the documents that prove your compliance activities are actually happening
- Staff training — delivered, completed, and acknowledged in writing by every person involved in designated services
- AUSTRAC enrolment — confirmed and on file
Can I Just Use AML/CTF Software?
Several software platforms have entered the market offering AML/CTF programs generated from questionnaires. They produce documents quickly and at low cost. For some businesses with very simple structures and risk profiles, this may be sufficient.
But there is an important distinction between having a document and having a compliant program. AUSTRAC does not just want the document to exist — it expects the program to reflect a genuine, tailored understanding of your specific business. A program that cannot be explained by your Compliance Officer, or that does not account for your actual client types and risk exposures, is not a compliant program. It is a liability dressed up as compliance.
A compliance professional does what software cannot — applies judgment, tailors the program to your actual business, trains your team to use it, and remains available when a suspicious matter lands on your desk on a Friday afternoon.
How Long Does It Take to Get Compliant?
A properly designed AML/CTF program for a small to medium real estate agency takes 4 to 6 weeks from start to completion. That includes gap assessment, program design, staff training, and AUSTRAC enrolment. If you have not started, the time to act is now — not next month.
