You may have seen that AUSTRAC has recently released its sector-specific AML/CTF “starter kit” templates ahead of Tranche 2 coming into effect. These templates are designed to help newly regulated, small and low-complexity businesses prepare for their AML obligations from 1 July 2026.
We’ve taken the time to read all 32 pages and have given a practical summary to help real estate businesses understand how to use the templates — without the confusion.
Firstly, the release of these starter kits is a positive and pragmatic step. For many newly captured sectors - including legal practitioners, accountants, real estate professionals and other designated service providers - AML/CTF compliance will be unfamiliar territory. Clear guidance and baseline templates can reduce uncertainty and help entities understand what “good” looks like under the new regime.
However, experience from comparable jurisdictions shows that reliance on templates alone carries material compliance risk if those templates are not meaningfully adapted to reflect the specific risks of each business.
When New Zealand extended its AML/CFT regime to lawyers, conveyancers and accountants, the New Zealand Law Society issued AML/CFT templates to assist firms in meeting their new obligations. These templates were widely adopted and, in many cases, relied upon heavily with minimal modification.
The issue was not the templates themselves, but how they were used.
A number of law firms failed to tailor these documents to the nature, size and complexity of their individual practices. Risk assessments remained generic, policies were not aligned to actual services offered, and procedures did not reflect how work was carried out in practice.
As a result, some firms were unable to demonstrate that they had properly identified and mitigated their specific money laundering and terrorism financing risks.
Regulators responded by issuing formal warnings and requiring remedial action. In many cases, deficiencies in documentation led to broader procedural shortcomings, including inconsistent customer due diligence practices, inadequate ongoing monitoring, and poor staff awareness of AML/CFT obligations. What began as a documentation issue ultimately exposed deeper operational compliance gaps.
This experience provides a timely and relevant lesson for Australian entities preparing for Tranche 2.
AUSTRAC’s starter kits are expected to provide a strong foundation: outlining common sector risks, example controls, and baseline AML/CTF Program structures. Used appropriately, they can significantly reduce the time and effort required to develop an initial compliance framework.
However, under Australia’s AML/CTF legislation, each reporting entity is required to develop and maintain a risk-based AML/CTF Program that is appropriate to its own business. This includes consideration of factors such as:
A generic template, no matter how well drafted, cannot capture these nuances without further analysis and adaptation. Regulators do not assess compliance based on whether a business used an AUSTRAC template — they assess whether the business can demonstrate a clear understanding of its risks and has implemented controls that are effective in practice.
The key message for Australian Tranche 2 entities is clear: starter kits should be treated as a starting point, not a substitute for a bespoke AML/CTF framework.
Businesses that invest the time to tailor their risk assessments, policies, procedures and controls to their day-to-day operations are far better placed to meet regulatory expectations, embed compliance into business processes, and respond confidently to any future AUSTRAC engagement.
Specialist AML/CFT consulting support can play a critical role in this process. Independent advisors can assist businesses to interpret AUSTRAC guidance, identify risks specific to their operations, and translate regulatory requirements into practical, workable controls. This not only reduces regulatory risk, but also helps ensure AML/CTF obligations are proportionate, efficient and sustainable.
As Australia enters the next phase of AML/CTF reform, the experience of New Zealand serves as a valuable reminder: templates are helpful, but compliance is ultimately defined by how well a framework reflects the reality of the business it governs.
Contact AMLHUB today to book a demo or discuss how we can help your organisation transition seamlessly into the new regime.