Everything you need to know about your obligations under AUSTRAC Tranche 2 — plain English, no jargon.
Tranche 2 refers to the second wave of reforms under Australia's Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (AML/CTF Act), enacted through the AML/CTF Amendment Act 2024.
From 1 July 2026, real estate agents who act as a seller's agent in property transactions become "reporting entities" — meaning you have legal obligations to identify customers, assess risk, report suspicious activity and enrol with AUSTRAC.
Real estate is a known high-risk sector for money laundering globally. Property transactions involve large sums, can be complex, and have historically been used to move and conceal illicit funds. This is why AUSTRAC is bringing the sector into the AML/CTF framework.
Before 1 July 2026 you need:
By 29 July 2026 you also need to be enrolled with AUSTRAC.
Your AML/CTF Program is a written document that sets out how your agency will manage its money laundering and terrorism financing risks. Think of it as your compliance policy manual.
It has two parts:
It must be formally approved by a senior manager (your Principal or Licensee in Charge) and kept up to date — reviewed at least annually.
If your agency acts as a seller's agent in the sale of residential or commercial property — yes, it applies to you.
The following are exempt (not covered by Tranche 2):
Under the current Tranche 2 reforms, the designated service covers agents acting on behalf of the seller. Buyer's agents — agents who act exclusively for the buyer — are not currently included as a designated service in the same way.
However, this is an evolving area and AUSTRAC guidance may clarify this further. If you act for both sellers and buyers, the obligations apply to your seller's agency activities.
Yes. The designated service covers the sale of real property — which includes both residential and commercial property. If you sell commercial property as a seller's agent, the same obligations apply.
Commercial transactions may actually carry higher risk ratings due to larger transaction values, more complex ownership structures (companies, trusts) and potentially more complex funding arrangements.
Off-the-plan sales present additional complexity because the buyer's identity may be known well before settlement, and the transaction timeline can span years. The same CDD obligations apply — you must identify and verify the buyer, but the ongoing monitoring requirements are more involved given the extended timeline.
Property developers who sell direct to buyers without using a licensed real estate agent may have their own separate obligations under Tranche 2. SimpleAML is designed for licensed real estate agents acting as seller's agents — if you are a developer selling direct, seek specific legal advice.
Stock and station agents who sell rural and agricultural land are covered by Tranche 2 in the same way as residential and commercial real estate agents — the designated service applies to the sale of real property broadly.
SimpleAML is not specifically designed for the stock and station sector and may not cover all the nuances of rural property transactions. Seek specific guidance if this is your primary business.
CDD stands for Customer Due Diligence. It's the process of identifying who your customers are, verifying that identity, and assessing the risk they pose for money laundering or terrorism financing.
Under the AML/CTF Act, you must perform CDD on both your seller and your buyer for every property transaction. The law requires this even if you've dealt with the customer before.
CDD involves:
Yes — even though you act for the seller, you must perform CDD on both parties. This is one of the most commonly misunderstood aspects of the new obligations.
The law requires you to identify and verify all parties to the transaction, not just your client. The buyer is a party to the transaction and must be identified.
Acceptable identity documents include:
Identity should be verified using the Document Verification Service (DVS) — an electronic check against government records. DVS is fast, reliable and provides an auditable record. Services like NameScan provide DVS checking.
If DVS is not used, you must inspect the original document in person (or via video call) and keep a certified copy.
A Politically Exposed Person (PEP) is someone who holds or has held a prominent public position — such as a government minister, senior public official, judge, military officer, or senior executive of a state-owned enterprise — in Australia or overseas.
Yes — you must screen every seller and buyer against PEP lists. PEPs carry a higher risk of corruption and must be treated as high-risk customers, regardless of other factors.
You must also screen against the DFAT Consolidated Sanctions List and the UN Security Council Consolidated List for every customer.
Seller CDD must be completed at listing — before or at the time of signing the agency agreement. You must not market or list the property until seller CDD is complete.
This is a hard rule — there is no grace period. If you list before completing seller CDD, you are in breach.
No. Legal reliance — where you rely on CDD performed by another reporting entity — is not available for seller CDD. You must always perform seller CDD directly.
This is different from buyer CDD, where legal reliance is available in certain circumstances.
Company seller: Verify the company name and ACN via ASIC. Identify all directors and verify at least one. Identify any beneficial owner (25%+ ownership). Confirm who is authorised to sign.
Trust seller: Obtain the trust deed. If individual trustee — verify as an individual. If corporate trustee — verify the company as above. Identify the settlor, beneficiaries and any person with effective control.
SMSF seller: Verify all members' identities. Verify the trustee (individual or corporate).
The timing depends on the sale method:
Legal reliance allows you to rely on CDD that has already been performed by another reporting entity (for example, the buyer's solicitor or mortgage broker) rather than performing CDD yourself.
To use legal reliance, all of the following conditions must be met:
If a buyer refuses to provide identification, you cannot proceed with the transaction. CDD is a legal requirement — proceeding without it exposes you to serious penalties.
A buyer's refusal to provide ID is itself a significant red flag and should be escalated to your AMLCO. Consider whether a Suspicious Matter Report (SMR) is required.
Common red flags in property transactions include:
Red flags don't automatically mean the transaction is suspicious — but they must be escalated to your AMLCO for review.
Enrolment is done through AUSTRAC Online at online.austrac.gov.au. The portal opens for Tranche 2 enrolments on 31 March 2026 and the deadline is 29 July 2026.
During enrolment you will need to provide:
Once enrolled, AUSTRAC will issue you an Entity ID — record this in SimpleAML.
An AMLCO (AML/CTF Compliance Officer) is the person responsible for overseeing your agency's AML/CTF compliance. Every reporting entity must appoint one.
Your AMLCO must be a fit and proper person — typically your Principal or Licensee in Charge. For small agencies, the LIC is almost always the AMLCO.
The AMLCO must be notified to AUSTRAC by 29 July 2026.
Once enrolled, you must submit an Annual Compliance Report (ACR) to AUSTRAC each year. The ACR reports on your compliance activities — your program, training, CDD processes and any issues identified.
The first ACR for Tranche 2 entities will be due in 2027, covering the period from 1 July 2026. AUSTRAC has not yet confirmed the exact due date.
SimpleAML's compliance evidence report is designed to help you prepare for this — it captures all the data AUSTRAC will want to see.
No — you don't need a lawyer to write your AML/CTF Program, but your completed program must accurately reflect your agency's actual circumstances, risk profile and procedures.
SimpleAML provides free Word document templates (Part A and Part B) that you can download, customise with your agency's details, and use as your program. These templates are AUSTRAC-aligned and cover everything required.
If your agency has complex or unusual circumstances, or if you are uncertain about your obligations, seeking legal advice is always a good idea.
Under section 159 of the AML/CTF Act, all reporting entities must arrange an independent evaluation of their AML/CTF Program at least every three years. The first evaluation for Tranche 2 entities is due approximately in 2029.
The evaluation must be conducted by a suitably qualified person who is independent of your agency — typically an external compliance consultant or auditor.
SimpleAML's compliance evidence report includes a Part B — Evaluation Support section specifically designed to help your evaluator assess your program.
The tipping-off prohibition (section 123 of the AML/CTF Act) makes it a criminal offence to disclose to a customer that a Suspicious Matter Report (SMR) has been, is being, or may be filed in relation to them.
This means you cannot warn a seller or buyer that their transaction is being investigated or that you have filed a report with AUSTRAC. All staff must understand this obligation — a breach is serious.
Yes — completely free. No account required, no subscription, no credit card. There is no catch.
SimpleAML was built by Chris Wong, CPA, because every existing AML compliance tool was built for banks and cost thousands per year. Independent real estate agencies deserve something built for them.
Your data stays in your browser — nothing is sent to any server. You own your data completely.
All your data is stored in your browser's localStorage — on your device only. Nothing is transmitted to any server.
This means:
Currently SimpleAML is a single-user, single-device app. Multiple staff can use it but they would each be using their own local copy on their own device — data is not shared between devices.
For a small agency, the most practical approach is to have one designated device (typically the AMLCO's computer) where all compliance records are maintained, and staff add their records to that device.
Cloud sync and multi-user support are on the future roadmap.
The Compliance Evidence Report is a printable document that draws all your SimpleAML data together into a single structured compliance record. It is not submitted to AUSTRAC — it is held by your agency as evidence of compliance.
It has two parts:
Generate it after enrolment so your AUSTRAC Entity ID is included, making it a complete record from 1 July 2026.
Non-compliance with the AML/CTF Act can result in serious consequences including:
No — SimpleAML is a compliance assistance tool, not a guarantee. It guides you through what AUSTRAC requires and helps you document your compliance, but you are ultimately responsible for ensuring your agency meets all its obligations.
SimpleAML does not constitute legal advice. If you are uncertain about your specific obligations, seek independent legal advice.
SimpleAML guides you through every step — free, no account required.