Public Consultation Opens for AUSTRAC’s New AML/CTF

Brendan Thomas, AUSTRAC CEO, is encouraging industry associates & business leaders to participate in the public consultation process for the new draft of Anti-money laundering & Counter-Terrorism Financing (AML/CFT) regulations.

The federal parliament passed the “AML/CTF Amendment Bill 2024” on November 29, 2024. According to this bill, AUSTRAC is working continuously to develop new rules, reform the AML/CTF regime, reduce regulatory impact, and simplify the bill to enhance flexibility and support every business to detect & prevent illegal activities such as financial crimes.

We want to ensure that these new Rules are practical and effective, and we value the input of industry. By engaging with businesses, we can develop a robust AML/CTF framework that supports innovation and economic growth while maintaining strong safeguards against financial crime.”

Mr. Thomas

The 1st round of public consultation on the draft rules will open until February 14, 2025. 2nd round of consultation will be in early 2025.

The new rules covered in the first draft are AML/CTF programs, customer due diligence, reporting groups, specifically business groups, compliance reports, correspondent banking relationships, travel rules, and open notices.

“I hope businesses – both currently regulated by AUSTRAC and those whose services will be covered by the new AML/CTF regime – take the time to read the consultation paper and make a submission.”

AUSTRAC

Businesses currently regulated by AUSTRAC and in DNFBP’s sector, operating in legal, accounting, real estate, precious stones, trust & company services, and virtual assets sectors, are highly encouraged to review the consultation paper and submit their feedback because these new AML/CTF rules can affect them.

Upcoming AML/CTF rules will be more flexible and follow risk-based, outcomes-oriented approach approaches to compliance, shifting away from the current perspective model that requires certain actions to meet AML/CTF obligations.

Read Also

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AUSTRAC Rules Structure

AUSTRAC has announced that it will amend the regulatory framework by creating two separate instruments to strengthen the AML/CTF regime, including:

• This new instrument will incorporate most of the rules and align them with the amended AML/CTF, and will named “Anti-Money Laundering & Counter-Terrorism Financing Rules 2025( New General Rules)”.
• Certain exemptions from the current Act will be preserved in the current instrument that will be renamed as “AML/CTF (Exemptions) Rules 2007 (Exemption Rules).”

Outcome-Based Approach

AUSTRAC wants to reduce unnecessary regulatory burdens on businesses by maintaining a strong AML/CTF regime and implementing an outcome-based approach.

This approach also emphasizes adaptability & scalability as the amended AML/CTF rules allow for a more customized approach relevant to every regulated entity’s unique circumstances.

AUSTRAC Expands Regulatory Reach to Different Businesses

AUSTRAC has also announced an expansion of the regulatory scope to diverse businesses – from small-scale to large financial institutions.

The amendment in the AML/CTF act will impose new obligations on entities, including:

• Partnerships and sole traders operate in professional services, retail, and hospitality sectors.
• Businesses located in rural & regional areas.
• Credit unions, banks & other large service providers.

According to a press release, implementing these certain obligations will vary according to business nature, company size & complexity. However, all regulated entities will be subjected to general obligation under the AML/CTF act. This flexibility is also recognized in the amended legislation.