The New Era of the AML/CTF Compliance Officer

Owl Advisory by KWM
Jul 18
2 min read

Australia’s Anti-Money Laundering (AML) and Counter-Terrorism Financing (CTF) landscape is on the cusp of significant change to modernise the regime. With amendments to the AML/CTF Act and Rules imminent, AUSTRAC’s recent statement of regulatory expectations has made it clear: by 1 July 2026, businesses in newly regulated sectors (i.e tranche 2 entities) must:

be enrolled as reporting entities,
designate an AML/CTF Compliance Officer (AMLCO),
have an AML/CTF Program in place, and
ensure staff are properly trained to implement and follow that program.

The AMLCO role sits at the centre of this new framework. Under section 26J of the amended Act, every reporting entity must appoint an AMLCO at the management level with sufficient authority, independence and access to resources and information to do the job properly. This is no longer a nominal title — the AMLCO must meet the ‘fit and proper’ standard, demonstrating competence, sound judgment, integrity and the necessary expertise for the organisation’s size and risk profile.

While AUSTRAC acknowledges that newly regulated sectors may face a steep learning curve, it has made its compliance expectations unambiguous: there must be genuine and demonstrable effort to comply with core obligations from day one. Failing to appoint an AMLCO, appointing an ineligible person, or missing deadlines may be non-compliant and expose businesses to regulatory penalties.

The expectations on AMLCOs are also increasing. They must oversee compliance with the Act, ensure the AML/CTF Program remains effective, communicate with AUSTRAC and report regularly to the governing body on AML/CTF related activities.

In light of these developments, Owl Advisory encourages clients — both existing and new reporting entities — to act now. Early identification and onboarding of a qualified AMLCO, investment in upskilling and resourcing, and clear governance arrangements will be critical to ensuring readiness for 1 July 2026.

To learn more or to discuss how we can support your organisation, please contact Tim Bednall, Director, or Himashi Cameron, General Manager, at Owl Advisory by KWM, or any partner in KWM’s Financial Regulation team.

This publication is a joint publication from King & Wood Mallesons, and KWM Compliance Pty Ltd (ACN 672 547 027) trading as Owl Advisory by KWM. KWM Compliance Pty Ltd is a company wholly owned by the King & Wood Mallesons Australian partnership. KWM Compliance Pty Ltd provides non-legal compliance and governance risk advisory services for businesses. KWM Compliance Pty Ltd is not an incorporated legal practice and does not provide legal services. Laws concerning the provision of legal services do not apply to KWM Compliance Pty Ltd.