AML crackdown begins: AUSTRAC puts real estate agencies under scrutiny

In documents seen by REB, AUSTRAC started sending section 167 notices to unregistered businesses in a bid to investigate and assess compliance.

According to the regulator, a section 167 notice is an AUSTRAC information-gathering tool requiring businesses to provide specified documents or information to assess compliance, rather than an enforcement action or indication that one will follow.

Under the new regulations, real estate businesses across the country were supposed to enrol with the watchdog by 29 July 2026.

So far, as of 20 August 2026, AUSTRAC showed that only 17,970 agencies had registered out of about 45,000 offices nationwide.

The notice requires agencies to provide records covering their AUSTRAC enrolment, business structure, operations, services, payment methods and brokering agreements, including agency agreements and contracts of sale.

It also seeks cash-handling policies and arrangements, along with invoices, receipts, purchase orders and transaction records for deals involving cash or virtual assets.

AUSTRAC CEO Brendan Thomas said the regulator had been clear about its expectations for more than a year, with enrolment being one of the most basic obligations for real estate businesses.

“We’ve consistently said our regulatory focus would be on businesses that are complicit in criminal exploitation, or those that fail to meet these fundamental requirements.”

“The notices we have issued to businesses are consistent with that approach, and they are not confined to the Real Estate sector,” Thomas told REB.

Thomas said the AML reforms were aimed at closing gaps in Australia’s framework, with real estate brought under the regime because of its vulnerability to criminals using property to move or conceal illicit funds.

"There is nothing ambiguous about the requirement for real estate agents to enrol if they are providing designated services.

“We published our expectations well before the reforms commenced, and businesses have had ample opportunity to prepare. Businesses that choose not to enrol should expect regulatory scrutiny,” he said.

AUSTRAC is making its move

According to AML Partners founder and managing director John Nguyen, the notices marked an early step in AUSTRAC’s push to bring non-compliant businesses into line.

“AUSTRAC is a very serious regulator because they fight financial crime. Their fines are very severe,” Nguyen told REB.

He said the notices were being sent to individual offices identified as unregistered, rather than automatically targeting an entire network, bringing both large and small agencies under scrutiny.

Despite more than a year of preparation for the reforms, Nguyen said some agencies had underestimated the regulator, while others struggled to understand what compliance required.

“I think a lot of people assume that AUSTRAC is just another normal regulatory body, and many have been thinking that the regulator won’t look at them”.

For smaller operators in particular, Nguyen said the complexity of AML compliance could have contributed to delays, with some businesses unsure how to meet their obligations.

“It’s difficult to become compliant because it’s not a straightforward thing,” he said.

For agencies that had already received a notice, Nguyen urged them to treat the matter as a legal issue and seek professional advice rather than simply rushing to put an AML programme in place.

“They need to engage a lawyer to help them respond to AUSTRAC to make sure that they’re giving the appropriate answers."

Nguyen also warned that failing to respond to a notice could lead to criminal penalties, while providing false or misleading information could carry even more serious consequences.

“This is a very serious matter,” he said.

For larger networks, he said non-compliance at an individual office could also create reputational damage for the broader brand and potentially expose the wider franchise.

“It can also potentially expose the whole franchise to future audits, et cetera,” Nguyen said.

More than just a ‘tick’

According to Nguyen, agencies that treated AML compliance as a “tick-box exercise” could leave themselves exposed, with the real work beginning after the initial programme was put in place.

“That’s the thing that people don’t realise. A lot of people are actually trying to DIY, so do-it-yourself AML compliance,” Nguyen said.

He warned that relying on software or internal staff without AML experience could create gaps in customer checks, record keeping and documentation, leaving agencies unsure whether their compliance processes were being followed correctly.

“A lot of people are actually trying to DIY compliance. They’re using various software tools. But at the end of the day, they’re relying on staff, internal staff that don’t have AML experience.

"That’s a real risk for a lot of businesses because they actually don’t know whether the staff are doing the right things, doing the right checks, documenting things correctly, keeping records for the correct amount of time.”

To avoid further compliance risks, Nguyen said agencies needed to continually review their programmes and ensure staff were carrying out the required checks and maintaining records properly, rather than treating it as a one-off task.

Beyond the regulatory consequences, Nguyen said AML enforcement could also affect how the public viewed the industry, particularly if an agency became the first to face an AUSTRAC fine or court action.

“This is going to impact trust, and no one wants to be ‘the first person’ reported to receive a fine or be taken to court.”

“The real work actually starts now.”