A senior industry body executive has highlighted the significant impact Tranche 2 of the Anti-Money Laundering and Counter-Terrorism Financing (AML/CTF) regime to take effect from 1 July will have on the greater SMSF sector.
SMSF Association head of policy Keddie Waller noted the next phase of the AML/CTF program has the potential to capture accountants, lawyers, bookkeepers and Australian Securities and Investments Commission agents, depending on the services they are providing.
Waller pointed out the key component of whether Tranche 2 of the AML/CTF provisions will apply to a practitioner is the concept of providing a designated service.
“If you provide what we call a designated service, you must enrol with AUSTRAC as a reporting entity and then comply with a range of AML/CTF obligations,” she explained.
She supplied some common examples of how these procedures will be applied.
“If you are providing a registered post office address for your client, [that is a designated service], if you are setting up what we call legal arrangements, which include trusts and SMSFs, that is a designated service, if you are preparing a trust deed, that is a designated service,” she told attendees of a recent webinar hosted by selfmanagedsuper.
“So accountants and lawyers are definitely caught, but also some other service providers. So if you think about your documentation providers [and practitioners] setting up SMSFs, for example, they will also have to comply with Tranche 2 and be ready to comply by 1 July 2026.
“So it’s a really broad and significant reform.”
According to Waller, one positive element of the introduction of the AML/CTF Tranche 2 provisions was the existence of the prescribed parameters.
“The good thing in this space is we actually have the legislation, we have the rules and we have some guidance already released so we’re not waiting on that to come through,” she said.
“The challenge is the guidance is not always clear on how it applies in practice.”
