Yes. Fund managers are existing (tranche 1) reporting entities under the AML/CTF Act 2006, because issuing or dealing in interests in a managed investment scheme and related financial services are designated services. They have been regulated for years, so the reform does not make them newly regulated; instead, reformed obligations apply to them from 31 March 2026. This is different from tranche 2 sectors such as lawyers and accountants, which only come under the Act from 1 July 2026.

From 31 March 2026 the reformed AML/CTF regime shifts fund managers from a compliance-based to a risk-based, outcomes-focused model. The Part A and Part B split of the AML/CTF program is removed, customer due diligence is restructured into initial CDD and ongoing CDD, it becomes an explicit requirement to appoint a fit and proper AML/CTF compliance officer, and existing designated business groups are replaced by reporting groups. The OAIC prohibition on retaining full copies of identity documents also takes effect on the same date.

Not all at once. As a tranche 1 reporting entity, a fund manager has until 30 March 2029 to bring its existing investor base up to the reformed initial CDD standard, and investors already on foot at 31 March 2026 can be treated as pre-commencement customers. 

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Pre-commencement customers must still be monitored, and full initial and ongoing CDD is triggered if a significant change lifts their ML/TF risk to medium or high or a suspicious matter reporting obligation arises. A staged remediation that prioritises higher-risk investors first is the practical approach.

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Initial customer due diligence (CDD) must be completed before the fund manager begins providing the designated service, which for a fund is typically when an investor subscribes for units or an interest in the scheme, not when distributions begin. Before onboarding, the fund manager must identify the investor, any representative, any person the investor acts on behalf of, and any beneficial owner, and screen those persons for sanctions and politically exposed person (PEP) status. CDD must be tied to the investor's ML/TF risk rating, which determines how much KYC information is collected and verified.

For an entity investor the fund manager must identify and verify the entity and then trace through to the natural persons who ultimately own or control it (the beneficial owners), generally any individual who owns or controls 25% or more, or the senior managing official where no one meets the threshold. For a company, collect the legal name, ACN or ABN and registered office and verify through ASIC; for a trust or SMSF, identify and verify the trustee(s), settlor and beneficiaries or class of beneficiaries and check the trust deed; for a partnership, verify the partnership and its partners. Each identified beneficial owner is then verified individually and screened for PEP and sanctions matches.

Yes. Wholesale, sophisticated and institutional investors are not exempt from AML/CTF customer due diligence, because the obligation attaches to the designated service rather than to the investor's classification under the Corporations Act. Wholesale status (for example, a sophisticated or professional investor certificate) affects disclosure and product obligations, not whether CDD, beneficial ownership identification and sanctions screening apply. The depth of CDD is set by the investor's ML/TF risk rating, so a low-risk wholesale investor may attract simplified CDD while a high-risk one attracts enhanced CDD.