Tipping off under the AML/CTF Act: What changed in March 2025?

From 31 March 2025, the Australian Transaction Reports and Analysis Centre  (AUSTRAC) brought into force updated ‘tipping off’ provisions under the Anti-Money Laundering and Counter-Terrorism Financing Amendment Act 2024 (Cth) (AML/CTF Act), as amended by section 123 the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (Cth).

The revised tipping off offence significantly changes how reporting entities must handle sensitive information — particularly information relating to Suspicious Matter Reports (SMRs) and AUSTRAC notices.

 While broader AML/CTF reforms won’t apply until 2026, these tipping off provisions are now active — and compliance teams should already have responded.

What Is “tipping off” under the AML/CTF Act?

Tipping off occurs when a person discloses information that could reasonably be expected to prejudice an investigation into an offence under Commonwealth, state or territory law — including laws relating to money laundering, terrorism financing, or the proceeds of crime under the Proceeds of Crime Act 2002 (Cth) — is federal legislation that allows authorities to trace, restrain, and confiscate criminal assets through freezing, restraining, forfeiture, and penalty orders.

 Examples of prohibited tipping off disclosures include:

• Telling someone that an SMR has been lodged
• Referring to the fact that AUSTRAC has issued a notice to produce documents
• Disclosing information that allows someone to infer that a person or business is under investigation

Maximum penalties include:

• Up to 2 years’ imprisonment, or
• 120 penalty units (currently $330 per unit), or both

Key changes from the previous tipping off offence

Old regime (Pre-31 March 2025):

• Covered only SMRs and AUSTRAC notices
• Allowed disclosure only to AUSTRAC entrusted persons (e.g. CEO, Director)
• Had narrow exemptions — e.g. to lawyers or corporate group members
• Difficult for reporting entities to share information with AML consultants or risk teams

New regime (From 31 March 2025):

• Applies more broadly to current and former reporting entities, employees, and agents
• Focuses on whether a disclosure could reasonably be expected to prejudice an investigation
• Allows more practical exemptions — while still imposing serious risk for non-compliance

The updated tipping off offence introduces greater flexibility for reporting entities to share information with law enforcement, corporate group members, and third-party providers for ML/TF risk management. These changes will also support compliance during mergers, acquisitions, and AML/CTF remediation projects.

 The Explanatory Memorandum to the AML/CTF Amendment Act makes clear that tipping off occurs where a reporting entity tells a customer — or their associate — that they are the subject of a SMR. Such disclosure could allow criminals to conceal or disguise their illegal activities, thereby prejudicing a law enforcement investigation.

The Legal Test for tipping off under the AML/CTF Act

What it means to prejudice an investigation

To determine if the tipping off offence has occurred under the revised AML/CTF Act, assess these elements:

1. Is the discloser covered by the offence?

Yes, if they are (or were):

• A reporting entity or member of a reporting group
• An employee, officer, or agent
• A person required to give information under sections 49 or 49B of the AML/CTF Act

2. Who was the information disclosed to?

No offence is committed if the disclosure is made to an AUSTRAC entrusted person, including:

• AUSTRAC’s CEO or Director
• AUSTRAC employees, taskforce members or authorised consultants

3. What information was disclosed?

The law prohibits disclosure of:

• The fact that an SMR has been lodged
• Copies or summaries of an SMR
• The existence or content of AUSTRAC notices
• Information under repealed provisions of the Financial Transaction Reports Act 1988 (Cth)

 4. Would the disclosure prejudice an investigation — or could it reasonably be expected to?

This includes:

• Ongoing or future investigations
• Potential or hypothetical cases
• Reckless disclosures, even without intent

Common tipping off risks for reporting entities

Here are realistic scenarios where tipping off risk is high:

• Informing a customer or adviser that their activity is under review
• Referring to AUSTRAC involvement in customer file notes or emails
• Mentioning a regulatory report in an internal meeting that includes third parties
• Delaying a transaction and explaining it's due to “compliance concerns”

Even subtle cues — like pausing services or requesting more information without a clear neutral explanation — can raise red flags.

Limited exemptions under the new regime

Crime Prevention Exception:

Disclosures made in good faith by legal practitioners, accountants, or advisers to dissuade a customer from committing an offence may be exempt.

Pending Regulations: The Amendment Act allows for regulations to enable inter-entity sharing for crime prevention purposes — but these are not yet in effect.

Court and Tribunal Clarification: Protected information may only be disclosed to a court or tribunal where necessary to give effect to the AML/CTF Act — not just upon request.

How to stay compliant with the 2025 tipping off rules

AUSTRAC recommends the following steps:

• Restrict access to SMRs and sensitive AUSTRAC-related documents
• Review third-party agreements and NDAs for confidentiality clauses
• Secure physical and digital storage (e.g. MFA, document encryption)
• Conduct ongoing training for employees, especially in customer-facing roles
• Update your AML/CTF Program to align with the 2025 offence provisions

Need help updating your AML/CTF program?

The tipping off offence is no longer limited to technical SMR disclosures — every careless comment, note or email is now a legal risk.

 At Click Legal, we help:

• Update AML/CTF Programs to reflect 2025 changes
• Conduct independent AML reviews for assurance and regulatory readiness
• Draft new AML/CTF Programs tailored to your business model
• Provide staff training, internal policy development, and incident response planning

Contact us today to reduce tipping off risk — and build a defensible AML compliance position.

Stay compliant with AUSTRAC’s 2025 tipping off rules. For expert AML/CTF legal support, reach us at hello@clicklegal.com.au.

_{Reference: Schedule 5 to the Anti-Money Laundering and Counter-Terrorism Financing Amendment Act 2024 (Amendment Act). 2 s41, Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (Cth).}

This article was written by Hannah Deuk, Corporate & Commercial Lawyer with 30+ years’ experience in financial services regulation and AML/CTF compliance.

Disclaimer: This publication has been prepared by professional lawyers and is intended to provide general information only. It is not, nor should it be relied upon as, legal advice. The information is current as at the date of publication. Before taking any action based on this content, you should obtain tailored advice from a qualified legal professional.