Insight

Moving from Designated Business Group to the Reporting Group model

By:
Neil Jeans,
Katherine Shamai,
Martin Stone,
Richard Storey,
Annelies Homersham
16 Sep 20255 min read
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Quick summary
  • Creating a reporting group under the amended Australian AML/CTF Act 2024 is appropriate when related entities seek to streamline their compliance efforts, share resources, and manage common AML/CTF risks more efficiently. This concept is particularly beneficial for entities with complex structures or those operating in multiple jurisdictions, as it allows for a coordinated approach to risk management and compliance. 
  • By adopting the Reporting Group model, entities can achieve cost savings, enhanced compliance, and optimised resource utilisation. However, they must also address challenges such as effective coordination, resource allocation, and maintaining robust internal controls. 
  • The lead entity within a Reporting Group is responsible for overseeing the implementation of the AML/CTF obligations, developing and maintaining ML/TF/PF Policies and Risk Assessments, and must ensure that all members comply with the AML/CTF Act and Rules.   
The AML Reforms introduce the concept of a 'reporting group'—a flexible model that allows both related and unrelated entities to manage and mitigate ML/TF risks under a single, comprehensive AML/CTF Program.

Moving from a Designated Business Group (DBG) to a Reporting Group under the new AML/CTF regime offers opportunities for efficiency and consistency but may bring significant governance, liability, and change management risk and challenges. Careful planning, early action, and robust oversight by the lead entity are essential for a successful transition. 

  • The AML/CTF reforms replace the DBG model with the new ‘Reporting Group’ concept, which allows a broader range of related entities - including non-AML/CTF reporting entities,  to be included in a single group for compliance purposes. 
  • Reporting groups can now be formed not only by corporate groups but also by unrelated entities (e.g. franchises, joint ventures, professional networks) if they share similar ML/TF risks and wish to coordinate compliance. 
  • A lead entity must be nominated to oversee the Reporting Group’s AML/CTF compliance. This entity is legally responsible for the compliance of all group members, including developing and maintaining the group-wide AML/CTF program, coordinating risk assessments, and ensuring all obligations are met. 
  • The lead entity must be able to control and enforce compliance across the group, maintain access to all records, and document which member is responsible for which obligations.  
  • Delegation of tasks is possible, but ultimate liability remains with the lead entity. 
  • Assess your structure: Review whether your organisation operates as a corporate group, business group, or franchise, and whether members share similar ML/TF risks and customer profiles. 
  • Evaluate compliance efficiency: Consider if a single group-wide program will reduce duplication, streamline reporting, and lower costs through shared resources and consistent controls. 
  • Governance and liability: Carefully weigh the ability of the lead entity to oversee and enforce compliance, especially in large or disparate groups, and be prepared for the lead entity to assume the risk of civil penalty for non-compliance by any member. 
  • Eligibility: Confirm your group meets any conditions in the AML/CTF Rules for forming a reporting group, as not all structures will qualify. 
  • Change management: The transition requires significant technical and business change, including updating risk assessments, policies, technology, and embedding new practices through strong project and stakeholder management. 
  • Start early: Begin analysis of the obligations, challenges and risks well before the March 2026 deadline. 
  • Focus on outcomes: Compliance is not just about documentation - it must be embedded in daily operations and culture, with a focus on harm reduction and effective risk management. 
  • Engage stakeholders: Successful adoption depends on strong leadership, clear communication, and buy-in across all levels of the organisation and Reporting Group members. 

We are here to help 

While the new AML/CTF requirements won't be a requirement until 31 March 2026 for existing reporting entities and 1 July 2026 for new reporting entities, it is vital to start planning and preparing for compliance now. 

With a short lead time to compliance and limited AML/CTF experts across Australia, demand will only continue to increase as the compliance date approaches.   

Contact one of our AML/CTF experts if you would like to discuss any of the above. 

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Authors
  • Neil Jeans
    Neil Jeans Neil has a unique background in financial crime risk management spanning almost 30 years, including working at senior levels managing AML/CTF, Sanctions and Anti-Bribery compliance across Europe, the US, Latin America, Asia, and Australia within two major global investment banks, one European financial services company, and a major Australian bank. View Profile
  • Katherine Shamai
    Katherine Shamai Katherine has over 24 years experience in providing financial crime, governance, compliance, risk and controls advisory, and investigative services to a range of clients including federal, state and local government agencies and departments, not-for-profits and NGOs, gaming, financial services, and ASX listed companies. View Profile
  • Martin Stone
    Martin Stone Martin has held wide-ranging roles in financial crime risk management in Australia and Europe over the last 20 plus years, including as AML/CTF Compliance Officer at two of Australia’s leading financial services organisations, and Divisional Money Laundering Reporting Officer at two of Australia’s largest banks. View Profile
  • Richard Storey
    Richard Storey Richard is a financial crime risk and compliance expert with a strong consulting pedigree, supporting clients to solve complex regulatory challenges across banking, gambling, digital finance, and funds management sectors. View Profile
  • Annelies Homersham
    Annelies Homersham Annelies has a proven track record in leading complex and sensitive transformations across diverse industries. Her expertise lies in navigating legislative, political, and organisational priorities with a commitment to excellence and practical solutions. View Profile

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