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Australia’s financial intelligence agency, AUSTRAC, has released its regulatory priorities for 2025–26, outlining an ambitious crackdown on financial crime risks, including both crypto-assets and cash.
The priorities reflect AUSTRAC’s two overarching strategic objectives: improving the management of money laundering, terrorism financing, and proliferation financing (ML/TF/PF) risks through stronger controls; and enhancing its intelligence capabilities through higher-quality reporting by regulated entities.
The move also signals AUSTRAC’s shift towards more targeted, risk-based supervision ahead of major reforms to Australia’s anti-money laundering (AML) regime.
AUSTRAC CEO Brendan Thomas said that “this year marks a regulatory shift”.
This is “from regulation that primarily checks for compliance to one focussed on substantive risks and harms.”
“AUSTRAC will look at risk and behaviour at an industry and sector level rather than focussing solely on individual entities,” he said.
As part of the plans, digital currency exchanges and virtual asset service providers (VASPs) will come under tighter scrutiny in the year ahead.
For example, AUSTRAC plans to register only those businesses that can demonstrate strong systems and controls for managing risks, with a June 2026 compliance target set across the board.
The agency will also intensify its regulatory focus on firms that are indifferent to these risks or complicit in financial crime, following growing concerns about the misuse of crypto-assets to move illicit funds across borders.
Risks associated with cash
Despite a steady decline in cash use in Australia, AUSTRAC continues to view cash as a major enabler of financial crime.
With more than A$100bn ($65bn) still in circulation and millions of high-value cash transactions reported annually, the agency is concerned about businesses that have failed to adopt adequate controls.
In the coming year, it has committed to conducting sector-specific reviews and intervening where cash-related ML/TF/PF vulnerabilities are poorly managed.
“We are also focussing efforts where the risk of harm is greatest, for example in digital currencies, which allow funds to move across borders quickly, cheaply and virtually anonymously,” said Thomas.
He added that “cash is also highly susceptible to money laundering because it is anonymous, accessible and widely accepted.”
“We see money laundering risks play out in cash intensive businesses as well as through digital currency exchanges and other virtual asset service providers that facilitate instantaneous global transfers.”
Improving data quality and reporting accuracy
Improving the quality and consistency of suspicious matter reports (SMRs) is another key objective for AUSTRAC.
The organisation said that SMRs are a critical source of financial intelligence, but warned that it has identified a sharp imbalance in reporting behaviour across the regulated population.
For example, a small number of entities are currently responsible for the vast majority of SMRs, while many businesses with greater risk exposure have never submitted a report.
AUSTRAC aims to identify and engage these under-reporting entities and ensure they strengthen their internal controls.
The regulator is also targeting improvements in the accuracy of enrolment information held on reporting entities.
It plans to use a range of communication channels to remind businesses of their obligation to update registration details whenever there are changes to their structure, services or key personnel.
Home and away
AUSTRAC’s priorities align with major legislative reforms due to take effect in Australia from March 31, 2026.
These reforms will update rules on customer due diligence, international transfers and virtual asset services, and the agency has said that it will support reporting entities in updating their AML/CTF programs to meet the new standards.
The agenda also has an international element, and includes plans to deepen cooperation with counterparts in the Pacific region.
AUSTRAC will increase its support for regional AML/CFT supervisors through the establishment of a new Pacific Supervisors Forum secretariat, delivery of annual meetings, and development of a joint work programme.
