The debate about tranche 2 of Anti-Money Laundering/Counter Terrorism Financing (AML/CTF) requirements has been ongoing since 2007 and has taken innumerable twists and turns in that time.
Last year, we looked at developments at a Senate committee inquiry and calls to expedite the extension of AML/CTF regulation to lawyers, real estate agents and accountants.
Now, with the change of Government, AML/CTF and tranche 2 is back on the table, with federal Attorney-General Mark Dreyfus recently releasing consultation on “overdue” reforms to Australia’s AML/CTF regime, saying:
“The existing regime is complex, resulting in regulatory inefficiencies for business and government. The Albanese Government is committed to simplifying and modernising the regime to address these inefficiencies.
“Lawyers, accountants, trust and company service providers, real estate agents, and dealers in precious metals and stones (known as tranche-two entities) are particularly vulnerable to exploitation by transnational, serious and organised crime groups and terrorists.
“Australia is now one of only five jurisdictions, including China, Haiti, Madagascar and the United States, out of more than 200, that do not regulate tranche-two entities.”
The Government has accepted all recommendations of the Senate Legal and Constitutional Affairs References Committee Inquiry into the adequacy and efficacy of Australia’s anti-money laundering and counter-terrorism financing regime.
The committee made four bipartisan recommendations, including that the AML/CTF regime be extended to tranche 2 entities and I thank the Committee for its work.”1
The public consultation material on proposed reforms released contained two parts, focusing on:
- reforms that will simplify and modernise the operation of the AML/CTF regime, such as addressing the AML/CTF Rules which were described as hard to follow and largely inaccessible, particularly for small business, and
- reforms extending the AML/CTF regime to certain high-risk professions, including lawyers, accountants, trust and company service providers, real estate agents and dealers in precious metals and stones.
Queensland Law Society and the Law Council of Australia have undertaken longstanding advocacy on the application of AML/CTF regulation to the legal profession.
Please provide any comments or views on the proposal, and in particular on questions 23-28 on pages 23 and 24 of the Consultation paper, to email@example.com by 2 June 2023. Submissions are due to Government by 16 June 2023.