Should I just stop offering designated services rather than deal with Tranche 2?
Possibly but it's worth weighing AUSTRAC's position and the practical implications before walking away.
It is an option, and we hear it most often from sole practitioners and small firms feeling overwhelmed by the change. Before walking away from clients and revenue, though, it's worth knowing how AUSTRAC has signalled it intends to approach the first 12 months - because the reality looks different from the worst-case scenarios.
A few points worth weighing:
AUSTRAC has signalled a supportive approach. Historically, AUSTRAC's significant enforcement actions have focused on major institutions and businesses showing blatant disregard, not SMEs adapting in good faith. Industry bodies have publicly echoed AUSTRAC's framing that the first 12 months of Tranche 2 will be education-led. AUSTRAC's own Core Guidance reinforces this: the test is whether your AML/CTF program is reasonable for your business, not whether it's perfect from day one.
Day-to-day CDD is closer to existing practice than it looks. Once your Risk Assessment, AML Program and staff training are completed, ongoing Customer Due Diligence is essentially a deeper, more structured version of the VOI processes many professional service firms already run today. It's not a new discipline; it's the discipline you already have, with more documentation and ongoing monitoring layered on top.
The platform does most of the heavy lifting. The parts of compliance that feel most daunting - maintaining a Program as guidance evolves, tracking training, retaining seven years of evidence, screening for PEPs and sanctions, generating reports for AUSTRAC - are precisely the things easyAML automates. The work that's left is judgement work: assessing risk on a transaction, deciding whether something is suspicious, supervising staff. That's the work only humans can do, and it's the work you're already doing today on every matter.
If you're considering walking away from designated services, try the free easyAML platform version. It includes the Risk Assessment, the AML Program, staff training, and platform access at no cost until 1 July 2026. Most firms find that once they see their Risk Assessment in front of them and their AML Program auto-generated, and have done some CDD, that the path forward is far less daunting than initially thought.