AML/CTF Reforms Are Coming: What Australian Businesses Need to Know
Summary:
Australia's anti-money laundering laws are undergoing their biggest expansion in years, and many businesses will soon notice new identity verification and compliance requirements as a result.
While these changes are aimed at preventing financial crime, they will also affect a range of everyday business services that have traditionally required very little verification. For businesses that use professional advisers for company administration, registered office services, trust structures or related corporate services, it is important to understand what is changing and why.
Why are the laws changing?
Australia is expanding its Anti-Money Laundering and Counter-Terrorism Financing (AML/CTF) framework to align more closely with international standards and strengthen protections against:
Money laundering
Fraud
Organised crime
Terrorism financing
The misuse of company and trust structures
The reforms extend AML/CTF obligations to a broader range of professional service providers, including businesses that provide certain trust and company services.
For many clients, this means additional identity verification will become a normal part of maintaining specific business services.
Who will be affected?
The new requirements may affect businesses and individuals that:
Use a professional firm's address as their registered office
Establish or manage companies and trusts through a professional adviser
Utilise certain corporate secretarial services
Have company directors, shareholders, trustees or beneficial owners who must be identified and verified
Importantly, these requirements apply regardless of how long you have been a client. Even long-standing relationships may need to undergo verification if the service falls within the new regulatory framework.
What information may need to be verified?
Depending on the service being provided, firms may be required to verify:
Company directors
Individual trustees
Corporate trustees
Shareholders
Beneficial owners
Individuals acting on behalf of an entity
Verification may involve confirming:
Full legal name
Date of birth
Residential address
Government-issued identification documents
The exact information required will depend on the nature of the entity and the applicable AML/CTF obligations.
Why are businesses being asked for information they have already provided?
This is one of the most common questions we expect to receive.
Many professional firms already hold information about their clients as part of their existing engagement and compliance processes. However, AML/CTF legislation requires identity verification to be conducted in a prescribed manner, and records must be maintained in accordance with specific legislative requirements.
As a result, businesses may be asked to provide information again, even where a long-standing relationship already exists.
How will verification work?
Many firms are adopting secure digital verification platforms to streamline the process.
Rather than completing paper forms or attending meetings in person, clients can typically verify their identity electronically using secure technology designed to protect personal information while meeting regulatory requirements.
The goal is to make compliance as straightforward and efficient as possible while maintaining high security standards
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Where verification is completed using Annature's identity verification platform, information is stored electronically within Annature's secure systems and retained in accordance with the service provider's legal and compliance obligations.
Annature employs security measures designed to protect data during transmission and storage, and verification records can be securely accessed by authorised users of the firm that requested the verification.
The firm requesting the verification remains responsible for meeting its AML/CTF and privacy obligations, including retaining records for the required period and ensuring personal information is handled appropriately.
Clients wishing to understand how their information is stored, protected and retained should refer to:
Annature's Privacy Policy
The firm's Privacy Policy
Any verification consent documentation provided during the process
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Where identity verification is legally required, a service provider may be unable to commence or continue providing certain designated services until the necessary verification has been completed.
This is a legal compliance requirement rather than a business preference.
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No.
These requirements are being applied broadly across affected services and businesses. Being asked to verify your identity is not an indication of any concern about your business activities.
Identity verification is simply part of the compliance obligations imposed on service providers under the AML/CTF regime.
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Where a service falls within the AML/CTF framework, professional firms are legally required to verify the identity of their clients and, in some cases, the individuals who own or control those entities.
Failure to collect and retain this information may prevent the firm from continuing to provide certain regulated services.
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Potentially, yes.
The requirements generally apply to the service being provided rather than the length of the client relationship.
Many existing clients may therefore be required to complete verification processes even if they have been clients for many years.
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A beneficial owner is generally a person who ultimately owns or controls an entity, even if their name does not appear directly on legal documents.
For example, an individual who controls a company through shareholdings or voting rights may be considered a beneficial owner.
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This will depend on the circumstances.
In some cases, a one-off verification may be sufficient. In others, firms may have ongoing monitoring obligations that require information to be updated if ownership, control or key details change.
Further information and support
We understand that regulatory changes can sometimes feel complex, especially when they introduce new compliance requirements for businesses that have operated unchanged for many years. At Mission Advisory, we care and are committed to making compliance as simple and fuss-free as possible for our clients. As these changes are introduced, we will continue to provide practical guidance and trusted support every step of the way.
For further information, or to discuss how these changes may affect your business, please contact the Mission Advisory team.