(Part 2 of 3)
AML/CTF Compliance: What Your Firm Needs to Do
As part of Australia’s Tranche 2 AML/CTF Reforms, accounting firms will need to establish a risk-based program. This is not just a tick-the-box exercise—it requires detailed policies, procedures, staff training, and ongoing reporting.
So, what exactly does an AML/CTF program involve?
The Two Key Parts of an AML/CTF Program
Under the reforms, firms must develop two key documents tailored to their specific risk profile and service offerings:
Risk Assessment
This forms the foundation of your AML/CTF Program. It involves:
- Evaluating your firm’s exposure based on client types, services offered, delivery channels, and geographical risks
- Considering the nature and complexity of the business
- Identifying the likelihood and impact of potential money laundering or terrorism financing risks across different parts of your business
- Documenting how these risks are identified and managed
AML/CTF Policy
This outlines the procedures and controls your firm will implement to comply with AML/CTF obligations and mitigate the risks identified. It should include:
- Governance and oversight arrangements, including a designated AML/CTF Compliance Officer
- Staff training on AML/CTF risks, red flags, and internal procedures
- Customer identification and verification procedures, including how you verify clients and beneficial owners
- Ongoing customer due diligence and enhanced due diligence for higher-risk clients
- Transaction monitoring and suspicious matter reporting processes
- Screening processes for politically exposed persons (PEPs)
- Employee due diligence measures to ensure staff involved in AML/CTF processes are trustworthy and appropriately vetted
Remember: Your AML/CTF Program must be reviewed regularly and independently evaluated every three years to ensure it is effective and compliant.
What’s Next?
Compliance is not just about paperwork—it also requires technology solutions to streamline identity verification, risk assessments, and reporting. In Part 3, we’ll discuss how your firm can leverage RegTech solutions and expert guidance to simplify AML/CTF compliance. Tech Solutions & Expert Support for AML/CTF Compliance.
For more information from AUSTRAC, please click here.
