Conveyancers do most AML work already but face big fines for slip-ups

CONVEYANCERS are already doing 80 per cent of the work they must carry out under new anti-money laundering reforms.

But all tranche 2 professions – who are being deputised to be the eyes and the ears of the Federal Government – need to start planning for the changes now or face the possibility of heavy fines.

Penalties of $19,000 a day can be issued against those who do not sign-up to be part of the new regime. And failure to carry out an annual compliance report also carries a $19,000 fine.

That’s the warning from Grant Thornton risk consulting partner Neal Jeans, an expert who is helping deliver training programs on behalf of regulator AUSTRAC.

“You are being brought into a regime where you are being deputised by the authorities to be the eyes and ears of the regime,” he told a webinar this week.

“You don’t get a badge or a gun, but you are being deputised as part of the network for law enforcement to provide information to law enforcement.”

He conceded that the incoming tranche 2 regime to support the Federal Government’s fight against Anti-Money Laundering and Counter Terror Financing (AML/CTF) was a “burden”.

But the former policeman believes conveyancers are well-placed, because they are already carrying out much of the due diligence work they must take on under AUSTRAC’s reporting regime.

“It is a burden. It is something that’s new, but my experience is that if you take the time to do the analysis, you are doing the vast majority of the stuff,” he said.

“You’ll probably find you are doing 80 per cent of what you need to do.

“You don’t call it AML at this point, or you don’t point to it as AML.

“You do due diligence on your customers, you know who they are. That’s called customer due diligence.

“You may not be doing the specific things that are required, but you are probably quite a significant way down the track for doing those.

“You vet your staff before they come in. You do reference checks and things. That’s called employee due diligence.

“So you can see how the things you do in your normal business as a well run business will translate.

“That incremental uplift does take time and there will be some new things. But my experience is that it’s about making sure that you’re meeting the standards.”

The AML expert was also optimistic that a feared exodus of conveyancers and lawyers would not happen.

“My experience in New Zealand with over 200 lawyers, 200 accountants and 200 real estate agents in 2018, bringing them into compliance, was that the sky didn’t fall in,” he said.

“There were some mergers of firms simply because people said they were end of their career and they decided to go under a bigger umbrella.”