AUSTRAC Tranche 2 Compliance: A Strategic Imperative for Accountants

Australia's financial crime landscape is evolving, prompting the Australian Transaction Reports and Analysis Centre (AUSTRAC) to extend Anti-Money Laundering (AML) and Counter-Terrorism Financing (CTF) obligations to a broader range of professionals under the Tranche 2 reforms. For Chartered Accountants, this expansion signifies a critical shift in compliance responsibilities, necessitating proactive measures to safeguard clients and uphold professional integrity.

New to Tranche 2? Start here: Tranche 2 AML/CTF Reforms in Australia: What Professional Services Firms Need to Know — a high-level overview of what Tranche 2 means, who is impacted, and why firm leaders should be paying attention now.

Understanding Tranche 2

Passed on 29 November 2024, the Tranche 2 reforms amend the AML/CTF Act 2006, incorporating professional service providers—such as accountants, lawyers, real estate agents, and trust service providers—into the regulatory framework. This inclusion mandates that these entities implement robust compliance programs to detect and prevent financial crimes effectively.

Key Compliance Requirements

1. Risk Assessment Accountants must proactively identify and assess risks associated with clients and services, considering factors like industry, geography, and transaction patterns.

2. Customer Due Diligence (CDD)Implementing a risk-based approach to verify client identities, understand the nature of business relationships, and monitor ongoing activities is essential.

3. Ongoing Monitoring Continuous oversight of client transactions to detect and report suspicious activities is mandatory, ensuring timely compliance with regulatory obligations.

   
   

Tranche 2 Compliance Timeline

To assist Chartered Accountants in preparing for the upcoming compliance requirements, the following timeline outlines key dates and actions:

Date	Action
31 March 2026	Enrolment with AUSTRAC opens for existing entities and virtual asset service providers.
1 July 2026	Compliance obligations commence for newly regulated professions, including accounting.
July–December 2026	Finalisation of sector-specific guidance and training resources.
Ongoing	Continuous monitoring and reporting as per AUSTRAC requirements.

PacificNet: Your Partner in Compliance

Navigating the complexities of Tranche 2 compliance can be challenging. PacificNet offers a comprehensive solution to help professional services firms move from awareness to implementation in a structured, defensible way.

A critical first step is understanding your firm’s exposure. Our guide, AML Risk Assessments for Tranche 2 Entities: A Practical Guide for Professional Services Firms, explains how to assess client, service, geographic and transaction risk, and how this risk assessment underpins all other Tranche 2 obligations.

PacificNet supports firms across this journey through:

• Automated Customer Due Diligence: PacificNet’s platform leverages advanced identity verification technologies to perform real-time, accurate client onboarding, reducing manual errors and enhancing efficiency.

• Continuous Monitoring: Our systems provide ongoing oversight of higher-risk clients and activities, supporting timely escalation and reporting where required.

• Seamless Integration: Designed to integrate with existing accounting and practice management systems, PacificNet enables firms to uplift compliance capability without disrupting day-to-day operations.

Best Practices for Compliance

To effectively meet Tranche 2 obligations, accountants and professional advisers should adopt a structured, risk-based approach:

• Start with a documented AML risk assessment: A clear understanding of your firm’s risk profile provides the foundation for proportionate controls and informed decision-making.

• Develop a comprehensive AML/CTF program: Establish policies and procedures aligned to your risk assessment, covering client onboarding, escalation and record-keeping.

• Implement robust training: Ensure partners, managers and staff understand their obligations, key risk indicators and escalation pathways.

• Utilise appropriate technology solutions: Where appropriate, adopt automated tools to support consistency, accuracy and auditability in compliance processes.

• Understand KYC & ID verification requirements: Particularly where client onboarding or complex entity structures introduce higher risk under Tranche 2.