These reforms commence on 1 July 2026, bringing these professions within AUSTRAC’s regulatory framework.
As a result, these entities will become AUSTRAC-regulated reporting entities and must comply with the full suite of AML/CTF obligations, including:
- Enrolment and ongoing registration with AUSTRAC
- Maintenance of documented Money Laundering/Terrorism Financing (ML/TF) risk assessments
- Implementation of an AML/CTF program
- Customer due diligence, including beneficial ownership identification
- Suspicious matter reporting
- Record-keeping and staff training requirements
Importantly, AUSTRAC may take regulatory action for procedural or systems-based non-compliance, even where no actual money laundering or terrorism financing has occurred.
The reforms significantly expand AUSTRAC’s enforcement powers, increasing potential exposure for both entities and individuals:
- Civil penalties (corporations): up to AUD 33 million per contravention
- Civil penalties (individuals): substantial monetary penalties for serious or systemic breaches
- Criminal penalties: for knowing or reckless conduct, including fines and imprisonment of up to 10 years
The AML/CTF Act does not expressly prohibit the indemnification of civil penalties, however AML/CTF exposure is fundamentally a compliance risk. Insurance should be viewed as a secondary support mechanism, not a substitute for a robust compliance framework. Your clients should be taking proactive steps now to ensure their AML/CTF programs, risk assessments, and staff training are in place ahead of the 1 July 2026 commencement date.
In light of the regulatory reform, effective 22 May 2026 DUAL has reviewed its underwriting appetite and will now apply an AML/CTF Affirmative Cover Endorsement to Management Liability policies for the following industry groups and occupations:
Industry groups |
Occupations |
|
- Accountants |
- Property development - Jeweller - Retailing or wholesaling (jewellers) |
This endorsement will apply for new business and renewals issued from 22 May 2026.
As AML/CTF exposures are fundamentally regulatory rather than client compensation risks, DUAL’s primary response is through Management Liability. While Professional Indemnity is not designed to address this exposure directly, DUAL PI policies include cover for legal representation costs at investigations under the Attendance at Investigations extension and fines and penalties under the Statutory Liability extension. These extensions may respond to AML/CTF exposures, subject to the terms, conditions and limitations of the policy.
Cover for these occupations is available for AML/CTF-related claims and investigations unless and until it is proven that the conduct was reckless, intentional, dishonest, fraudulent, criminal or malicious. Where the AML/CTF Affirmative Cover Endorsement applies, indemnity for such penalties may be available, subject to any court order or AUSTRAC direction restricting the application of insurance proceeds to satisfy the penalty.
If you have clients in industries not listed above who may be impacted by the AML/CTF reforms, please get in touch. DUAL is able to review coverage on a case-by-case basis and discuss underwriting options for other occupations as they come within AUSTRAC's regulatory scope.
Any product information discussed in this blog is subject to the terms and conditions of the policy, eligibility criteria, any additional premium for optional cover, limitations and exclusions.
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The information contained in this blog is intended for licensed insurance brokers and other authorised intermediaries only. DUAL issues insurances on behalf of Certain Underwriters at Lloyd’s of London and/or Allianz Australia Insurance Limited, acting as their agent. The information is of a general nature and does not take into account the objectives, financial situation or needs of any person. It is intended for the use of professional intermediaries who are expected to consider whether it is appropriate for their clients. Before recommending or offering any insurance product, intermediaries should read the policy wording, relevant Product Disclosure Statement (PDS) and Target Market Determination (TMD) and assess whether the product is suitable for their client’s circumstances. These are available on request or via our website at DUAL Australia.