AML/CTF Obligations Commencing 1 July 2026

What the new AML/CTF laws mean for you - The Client

From 1 July 2026, Australian Anti-Money Laundering (AML) and Counter-Terrorism Financing (CTF) laws will expand to include Trust and Company Service Providers (TCSP) and Professional Service businesses such as ours.

As part of these reforms, CorpSec Services will be legally required to carry out identity verification and ongoing compliance checks for certain services we provide to clients that will now be regulated under the new laws.

While these changes are designed to strengthen the integrity of Australia’s financial system and reduce financial crime, they will also introduce additional compliance procedures for businesses and their advisers.

This means you may notice:

• Requests for identification documents

• Additional questions regarding your business structure

• Verification of directors, shareholders, trustees, and beneficial owners

• Periodic reviews and monitoring requirements

• Questions regarding the source of funds

• Additional administration and compliance costs

Our goal is to make this process as simple and efficient as possible, while continuing to support your business with minimal disruption.

What is AML and CTF?

Anti-Money Laundering (AML) laws are designed to prevent criminals from disguising illegally obtained funds as legitimate money.

Counter-Terrorism Financing (CTF) laws aim to prevent funds from being used to support terrorism or other serious criminal activity.

The AML/CTF laws require certain businesses and professional service providers to:

• Verify the identity of their clients

• Understand who owns or controls a business

• Monitor transactions and activities

• Maintain accurate records

• Monitor for suspicious or unusual activity

• Report suspicious matters where legally required

Who regulates these laws?

These obligations are overseen by AUSTRAC, Australia’s financial intelligence and AML/CTF regulator. Under the new regime, accounting and professional services firms will be required to comply with AUSTRAC regulations when providing designated services.

What will we need from you?

For our existing clients, we already maintain detailed records regarding officeholders, shareholders and company details. However, we may need to formally verify an individual that hasn't previously been identified or obtain a copy of a trust deed to confirm beneficial ownership, trustee information or the name of an individual who controls the trust.

For new client engagements involving designated services, we must gather personal information, perform initial client due diligence and verify the identity of key individuals before providing the service. Many of these requirements were already integrated into our onboarding processes. The AML/CTF reforms simply elevate the obligations and make us legally accountable if we fail to adhere. Where multiple entities are part of a business group, separate verification may be required for each entity.

These checks are mandatory and apply across the profession — they are not based on suspicion or concern about any individual client.

What services are 'designated services'?

Whilst many of the services we typically provide are designated services, there are some that are not regulated. It could take months or years into our engagement before a designated service is required. Examples of services we provide from 1 July 2026 that may trigger AML obligations include:       

• Company formations and trust establishments

• Officeholder appointments

• Share transfers of controlling interests

• Share allotments

• Company or trust restructures

• Local agent services for foreign registered companies in Australia

• Provision of a registered office or business address (pre-commencement clients).

Ongoing monitoring requirements

The legislation also requires firms to conduct ongoing monitoring of client relationships.

This may include:

• Periodic review of identification information

• Monitoring for unusual or suspicious transactions

• Reviewing unusual changes in business ownership or structure

• Compliance checks against government watchlists and

• Additional due diligence where higher-risk activities exist

For most clients, this process will operate quietly in the background and will not impact day-to-day business activities.

Why are these changes being introduced?

Australia is addressing significant regulatory gaps and aligning its laws with international standards aimed at combating:

• Money laundering

• Organised crime

• Fraud

• Terrorism financing

Professional service providers such as us, accountants, lawyers, real estate professionals, and trust service providers are now being brought within the expanded AML/CTF framework under the Tranche 2 reforms to commence on 1 July 2026.

Will this affect existing clients?

Yes. The laws apply to both new and existing clients where designated services are provided.

Even long-term clients may need to complete identification checks to ensure records meet current legal requirements.

The good news is that existing clients as at 30 June 2026 are referred to as 'pre-commencement customers' and initial client due diligence and verification procedures are only required under certain circumstances, even if a designated service is requested after commencement of the laws. For example, a 'pre-commencement' client requesting a designated service is not captured if the client is assessed as low risk under our AML Program and the requested designated service does not result in a 'significant change in the nature and purpose of the business relationship'.

The key point to remember is that you don't need to be concerned about what is captured or not; that's our responsibility, and we will instruct you accordingly.

Will there be additional costs?

The new obligations create a significant compliance burden and imposes additional costs for professional firms, including:

• Identity verification systems

• Specialist compliance software to manage risk assessments and ongoing monitoring processes

• Staff training

• Record keeping and reporting obligations to AUSTRAC

• Mandatory independence reviews of our AML Program every three years

As a result, some AML compliance-related fees may apply depending on the nature of your business structure and the services provided.

We will always aim to be transparent regarding any costs associated with these requirements.

What happens if information cannot be verified?

Under the legislation, professional firms may be unable to provide certain services if required identification procedures cannot be completed.

This may include situations where:

• Identification documents are unavailable

• Clients are uncooperative

• Ownership structures cannot be verified

• Required trust documentation is missing or not supplied

• Legal compliance obligations cannot be satisfied

We will always work with clients to resolve issues wherever possible.

Is my information secure?

Yes. Any information collected as part of AML/CTF compliance obligations is handled in accordance with Australian privacy laws and secure record-keeping requirements.

Information is only used for compliance purposes required under the legislation.

What should you do now?

At this stage, there is no immediate action required for most clients. However, to help ensure a smooth transition, we recommend:

• Keeping your identification documents current

• Advising us of any major business structure changes

• Responding promptly to any verification requests

• Ensuring trust deeds and company records are accessible and up to date

We will guide you through any required steps, if and when needed, after the new laws come into effect. However, providing certain services will no longer be about collecting the bare minimum information to deliver the service as quickly as possible. It will now involve collecting all required information to assess and manage AML/CTF risk and complying with our obligations.

We’re here to help

We understand these changes may feel like additional administration for business owners.

Our team is committed to making the process as straightforward and practical as possible while ensuring full compliance with the new legal requirements.

If you have any questions regarding the new AML/CTF obligations, or how they affect your business, please contact us at team@corpsecservices.com.au for further information.

For official guidance on the reforms, visit AUSTRAC.