Compli3d - Stakeholder Briefing: Tranche 2 AML/CTF Reforms

Stakeholder Briefing: Tranche 2 AML/CTF Reforms – Implications for your business

Overview

The Australian Government is moving ahead with Tranche 2 AML/CTF reforms, which will bring new industries (e.g. lawyers, accountants, real estate agents) into the regulated financial crime compliance framework. While these reforms are not directly targeting banks and fintechs, the implications are significant — especially for SMEs that work with, service, or rely on these industries.

This briefing outlines the key changes, our business risks and opportunities, and the strategic response plan being implemented by [Your Business Name].

1. What is Tranche 2?

Tranche 2 refers to the second phase of Australia's AML/CTF legislation, which expands the coverage of the AML Act to include Designated Non-Financial Businesses and Professions (DNFBPs), such as:

Lawyers and conveyancers
Accountants and auditors
Real estate agents
Trust and company service providers
Dealers in high-value goods

These entities will need to meet the same AML obligations that apply to banks, including:

Conducting customer due diligence (CDD)
Maintaining AML programs
Reporting to AUSTRAC

2. Why It Matters to [Your Business Name]

Even though we are already regulated, Tranche 2 will increase:

Scrutiny on our AML controls — especially when servicing DNFBP clients
Compliance risk if third-party partners or clients are not AML-compliant
Operational workload for onboarding, monitoring, and reporting

There is also a strategic opportunity: to become a trusted service provider for newly regulated industries seeking secure banking, payments, or digital onboarding solutions.

3. Key Risks and Considerations

Area	Risk	Mitigation
Customer onboarding	Higher failure rate from DNFBPs unprepared for KYC	Enhanced onboarding workflows, education
Third-party exposure	Reputational and legal risks from high-risk referrers	Contractual updates, KYB reviews
Reporting obligations	Surge in suspicious matter reports (SMRs)	Automation, training, early system reviews
Regulatory audits	AUSTRAC may increase audits or request proof of compliance	Program refresh, stronger documentation

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4. Our Response Plan

Initiative	Action
Program review	Conduct end-to-end AML program audit
Staff enablement	Deliver internal training by [Date]
Customer education	Launch onboarding support for new DNFBP clients
RegTech investment	Assess automation tools for transaction monitoring & eKYC
Partner due diligence	Update contracts, KYB checks for referrers

5. Next Steps for Stakeholders

Executive Team: Approve updated risk framework and funding for RegTech initiatives
Product/Onboarding Teams: Begin aligning workflows with enhanced CDD requirements
Compliance Team: Update AML/CTF program and prepare for AUSTRAC questions
Customer Success: Create support scripts and materials for DNFBP onboarding
Legal/Partnerships: Review all DNFBP contracts and referral agreements

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