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The Australian Transaction Reports and Analysis Centre (AUSTRAC) has said it does not expect businesses to begin working towards compliance until it clarifies whether they are captured by the regime. But the Finance Brokers Association of Australasia (FBAA) said it is continuing to push for answers as the first infringement notices of up to $21,000 are issued.
“The FBAA has again followed up with AUSTRAC for an update on how the anti-money laundering and counter-terrorism financing (AML/CTF) legislation applies to finance broking activities, including commercial asset finance broking,” said FBAA CEO Leo Gagic.
“We remain committed to pursuing this matter to resolution, so members have certainty about any obligations.”
Gagic said the association had received no further update since AUSTRAC’s letter on 21 July but had again requested advice on what would happen next.
“In that letter, AUSTRAC advised it did not expect businesses to begin working towards compliance in relation to this issue until it published its position. It also recognised that affected businesses would need time to prepare if finance broking activities were determined to fall within scope.
“We know members need a clear answer. We will continue pressing for one and share further advice as soon as it is received.”
What’s the issue?
The AML/CTF regime expanded on 1 July 2026 to cover businesses in sectors including real estate, legal services, accounting, conveyancing, trust and company services, and dealing in precious stones and metals.
Businesses captured by the regime must enrol with AUSTRAC and take steps to understand their obligations, assess their risks and implement appropriate controls.
However, it remains unclear whether asset finance brokers must enrol and comply with requirements including developing an AML/CTF program, appointing a compliance officer, conducting customer due diligence and reporting suspicious matters.
Following the expansion, the FBAA sought urgent clarification over concerns that commercial asset finance broking could fall within the legislation’s definition of “debt financing” as a designated service.
The association pointed to AUSTRAC guidance stating that debt financing includes “all capital and debt-raising methods”, including “secured or unsecured bonds, bills or notes, asset financing, loans (including government loans) and debentures”.
The broad definition has raised questions over whether commercial asset finance brokers arranging finance for businesses to purchase vehicles or equipment could be captured by the expanded regime.
If they are, brokers could face a raft of AML/CTF obligations, including enrolling with AUSTRAC, developing a compliance program, appointing a compliance officer, conducting customer due diligence and reporting suspicious matters.
Privacy breach concerns?
Richard Mallam, founder and CEO of digital identification company VO, has also warned that the expanded regime could create a “ticking time bomb” for affected businesses, which must collect sensitive personal information and ensure it is kept secure.
“Extending this law to these businesses was aimed at stopping criminals moving dirty money but has created a parallel privacy crisis at a time when cyber crime is becoming more sophisticated,” he said.
Mallam said around 100,000 businesses across the country would be required to verify clients, identify who ultimately controls companies and trusts, monitor suspicious activity and maintain compliance records under the new legislation.
“A small suburban accounting practice or real estate agency can now be collecting highly sensitive customer information while carrying privacy obligations they might never previously have had to deal with.
“These businesses must conduct customer due diligence, verify identities, assess risk, maintain compliance programs and keep records and they are telling me they are already struggling to comply.”
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