The second round of public consultation reflected feedback from the first round in February 2025 and sought feedback on the final sections added to complete the new Rules.

We supported amendments made following the first round of consultation, in particular,  AUSTRAC's expressed intent to explore the interaction of the obligation to conduct an independent evaluation of a AML/CTF program with the starter programs for small, low risk reporting entities. 

Independent evaluations

In the second round of consultation no change has been made in the draft Rules. Therefore we reiterated our concern of the disproportionate cost and compliance burden to conduct an independent evaluation for individuals, partnerships and small reporting entities. We sought for the Rules to include the statement that such evaluations should be conducted relative to the size, nature and risk of a reporting entity. This to be supported in the forthcoming guidance by AUSTRAC setting out its expectations of how independent evaluations are to be conducted for different sized entities.

Customer due diligence

The draft Rules are supporting the reforms to the regime which seek to focus on achieving outcomes rather than being prescriptive on how those outcomes are achieved. Accordingly, customer due diligence in the related Act requires reporting entities to collect enough data to be reasonably certain of the identity of a customer with the Rules to prescribe the minimum information required. The draft Rules set out the minimum required for each type of client and we sought removal of information a reporting entity cannot verify, such as a person's director ID. We suggested, where AUSTRAC considers additional information would further strengthen client identification, this could be included as an AUSTRAC recommendation in the forthcoming guidance.

Enrolment

Similarly, we support AUSTRAC gathering information about reporting entities to better understand their regulated population. Even so, this should be limited to information AUSTRAC requires for its functions and activities to minimize the compliance obligation on reporting entities. We sought for the information required on enrolment to be streamlined to minimize the data a reporting entity will need to gather and provide.

We included an attachment which mapped out some common structures of accounting practices. In these structures, we highlighted which party we understood to be the reporting entity and whose details would be required on enrolment.

We would like to thank CA ANZ members who provided input on the draft Rules to inform our submission. AUSTRAC have indicated they expect to publish the final new AML/CTF Rules in August 2025.