AML/CTF laws - what are they and what is a "PEP"?
Updated: Sep 11
Australia has expanded its anti-money laundering and counter-terrorism financing framework. From 1 July 2026, a broader range of businesses and services across Australia are required by law to collect information about their customers, and their customers' transactions.
The updates are intended to bring Australia's AML/CTF framework in line with international standards and ultimately aim to lock criminal funds out of Australia's economy.
What does this mean for you?
Your lawyer, real estate agent, accountant and other consultants affected by the expanded framework will have worked hard behind the scenes to meet the strict requirements of the Anti‑Money Laundering and Counter‑Terrorism Financing Act 2006 (Cth), as amended.
You can expect to answer more questions than usual before engaging their services, or before certain work can occur. Your client agreement likely requires you to cooperate with this process.
If this information is not provided, your lawyer, real estate agent or other consultant may be prohibited by law from acting for you in the transaction, and businesses breaching these requirements are at risk of enforcement action.
What is the purpose of the AML/CTF questions?
AML/CTF questionnaires are necessary for record keeping in accordance with the law, and to allow the service to conduct a risk assessment. In some cases, your service provider may have follow up questions to ask you.
If you have any concerns about any part of an AML/CTF questionnaire provided to you, you can learn more about why this is required here, or give the business a call.
I'm completing a questionnaire, who is a 'politically exposed person' (PEP)?
The following information is provided courtesy of AUSTRAC.
Note: Family members and close business associates of persons who hold one of these positions are also considered politically exposed persons.
Foreign PEP
A foreign PEP is an individual who holds or has held a prominent office or position or public function in or for the legislature, executive or judiciary of a foreign country.
This includes an individual who holds or has held any of the following offices or positions:
head of state or head of government
member of the executive council of government
member of a legislature
minister, deputy minister or equivalent office or position
judge of a supreme court, constitutional court or other court of general jurisdiction or last resort
ambassador, high commissioner or charge d’affaires
high ranking military officer
head or board member of a government body
head or board member of a state‑owned company or a state‑owned bank
member of a governing body of a political party represented in a legislature.
A foreign PEP is also a family member of an individual listed above or an individual who is known (based on information that’s public or readily available) to have:
joint beneficial ownership of a body corporate or legal arrangement with an individual listed above
sole beneficial ownership of a body corporate or legal arrangement on behalf or for the benefit of an individual listed above
any other close business relations with an individual listed above.
Domestic PEP
A domestic PEP is an individual who is in or has been in the following office or position:
member of the legislature of the Commonwealth or a state or territory
member of the governing body of a political party represented in the legislature of the Commonwealth or a state or territory
Governor‑General
governor of a state
administrator of a territory
Justice of the High Court
Judge of the Federal Court of Australia
Judge of the Supreme Court of a state or territory
accountable authority, or member of the accountable authority, of a Commonwealth entity within the meaning of the Public Governance, Performance and Accountability Act 2013 (PGPA Act) (for example a Secretary of a Department of State or parliamentary department)
member of the governing body of a wholly‑owned Commonwealth company within the meaning of the PGPA Act
head (however described) of a department of state or territory, or an agency or authority of a state or territory that has a prominent public function
head (however described) of a local government council in a state or territory
the chair of the board, chief executive officer or chief financial officer of a company or other incorporated body that’s wholly‑owned or majority‑owned by a state or territory
Chief of the Defence Force, Vice Chief of the Defence Force, Chief of Navy, Chief of Army or Chief of Air Force
officer of the Navy of the rank of Vice Admiral or a higher rank
officer of the Army of the rank of Lieutenant General or a higher rank
officer of the Air Force of the rank of Air Marshal or a higher rank
any of the following offices of the Commonwealth in a foreign country, or to a public international organisation, to which appointments are made by the Governor‑General:
Ambassador
High Commissioner
Consul‑General
Australian representative
special representative
representative
permanent representative
Chargé d’Affaires.
A domestic PEP is also a family member of an individual listed above, or an individual who is known (based on information that’s public or readily available) to have:
joint beneficial ownership of a body corporate or legal arrangement with an individual listed above
sole beneficial ownership of a body corporate or legal arrangement on behalf or for the benefit of an individual listed above
any other close business relations with an individual listed above.
International organisation PEP
An international organisation PEP is an individual that is entrusted or has been entrusted with a prominent public function, position or office of a public international organisation. This includes a head, deputy head or board member in a public international organisation, such as a United Nations body.
An international organisation PEP is also a family member of one of these individuals, or an individual who is known (based on information that’s public or readily available) to have:
joint beneficial ownership of a body corporate or legal arrangement with an individual entrusted with a prominent public function, position or office of a public international organisation
sole beneficial ownership of a body corporate or legal arrangement on behalf or for the benefit of an individual entrusted with a prominent public function, position or office of a public international organisation
any other close business relations with an individual entrusted with a prominent public function, position or office of a public international organisation.
Family members
A family member includes:
a spouse, de facto partner, or equivalent under any applicable law of a foreign country, of the individual
a child of the individual
a spouse or de facto partner, or equivalent under any applicable law of a foreign country, of a child of the individual
a parent of the individual.
Learn more
If you would like to understand more about how the services you use are affected by AML/CTF regulations visit https://www.austrac.gov.au/general-public.
