AUSTRAC Guidance on New Compulsory Examination Powers

AUSTRAC News & Media

Published March 5th, 2026

Detected March 30th, 2026

Summary

AUSTRAC published guidance on its new compulsory examination powers under section 172A, which were introduced by the Anti-Money Laundering and Counter-Terrorism Financing Amendment Act 2024. The guidance explains what information is included in examination notices, the examination process, the role of the examiner, legal representation rights, and how information is handled. The guidance clarifies that compulsory examinations are not routine or punitive and are used to understand money laundering risks and how businesses are managing those risks.

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What changed

AUSTRAC has issued guidance explaining how it will exercise the new section 172A compulsory examination powers introduced by the AML/CTF Amendment Act 2024. The guidance covers what information must be included in examination notices, what witnesses can expect during an examination, the role of the examiner, witnesses' entitlement to legal representation, and how provided information will be handled. The guidance emphasises that receiving a section 172A notice does not indicate AUSTRAC believes a person has broken the law—the focus is on gathering accurate information for informed regulatory decisions and identifying criminal misuse of the financial system.

Reporting entities subject to AML/CTF obligations, particularly those in financial services, should review this guidance to understand how AUSTRAC will apply these examination powers. While the guidance does not create new compliance obligations, entities should be aware of their rights during examinations, including the right to legal representation and the ability to speak with health professionals. There is no specific compliance deadline associated with this guidance.

What to do next

Review AUSTRAC's published guidance on section 172A examination powers to understand the examination process
Ensure legal representation arrangements are in place for staff who may receive examination notices
Familiarise employees with their rights during compulsory examinations, including legal representation entitlements

Source document (simplified)

5 March 2026

AUSTRAC has published guidance on its new compulsory examination powers, setting clear expectations for businesses and individuals about when and how the powers will be applied.

The new section 172A powers were introduced in 2025 with the passing of the Anti-Money Laundering and Counter-Terrorism Financing Amendment Act 2024 (AML/CTF Amendment Act).

Section 172A notices require a person to attend an examination, answer questions and provide documents.

AUSTRAC CEO Brendan Thomas said the guidance reflects the agency’s approach to exercising its powers carefully and responsibly.

“The guidance is designed to ensure the community understands the scope of the power and the approach AUSTRAC will take to its use,” Mr Thomas said.

“This power and the suite of reforms that went with it, give AUSTRAC better tools to understand money laundering risks and how businesses are managing those risks which can ultimately disrupt serious and organised crime.

“The guidance makes it clear that compulsory examinations are not routine or punitive.

“They are used where necessary to understand how businesses handling money laundering risks, clarify information or engage with a reporting entity.”

Australia’s AML/CTF reforms are aimed at making it harder for criminals to launder money through the legitimate economy. The Australian Institute of Criminology estimates serious and organised crime generates around $38 billion each year, all of which must be laundered to be useful.

The Anti‑Money Laundering and Counter‑Terrorism Financing Amendment Act 2024 strengthens AUSTRAC’s ability to detect and disrupt this activity by expanding its information‑gathering powers.

The new guidance explains what information is included in a section 172A notice, what happens during an examination, the role of the examiner, how legal representatives may assist, and how information provided is handled.

In designing our approach we’ve considered witness welfare.

In particular, we’ve made it clear witnesses are entitled to legal representation, and they may speak about the notice with a health professional.

Importantly, receiving a section 172A notice does not necessarily mean AUSTRAC believes a person has broken the law.

“In many cases, an examination is simply a way to understand what has happened.”

“The focus is on gathering accurate information so we can make informed regulatory decisions, identify where risk may lay across the financial landscape and target criminal misuse of the system, not on making assumptions about wrongdoing.

“By being clear about how we use these powers, we support legitimate businesses and individuals while strengthening our ability to stop criminal money flowing through the economy.”

The guidance is available on the AUSTRAC website.

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Email: media@austrac.gov.au
Phone: 02 9950 0488

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