APRA proposes tougher investment governance for super trustees, AUSTRAC starts issuing infringement notices to non-enrolled businesses and ASIC sets its 2026–27 supervisory priorities 5 min read
APRA has proposed tougher investment governance standards for super trustees, AUSTRAC has started issuing infringement notices to businesses that failed to enrol under the expanded AML/CTF regime, and ASIC has released its 2026–27 supervisory priorities, including a review of banks' use of AI. Submissions are due on 16 October for Armaguard's proposed undertaking, 9 November for ASIC's CFD proposals and 3 February 2027 for APRA's draft standard.
Change of laws and guidance
ASIC remakes relief for client money held in cash common funds
Who is this relevant for? AFS licensees
ASIC has remade a legislative instrument that permits AFS licensees to place client money in cash common funds, provided the fund is also a registered scheme. ASIC Corporations (Client money – Cash common funds) Instrument 2026/727 continues the existing relief arrangements and replaces the previous instrument, which expired on 1 October 2026.
ASIC increases low-volume financial market transaction threshold by $1 million
Who is this relevant for? Financial markets
ASIC has replaced the expiring instrument that exempts low-volume financial markets from the requirement to hold an Australian market licence. ASIC Corporations (Low Volume Financial Markets) Instrument 2026/756 continues the relief provided under the previous instrument until 1 October 2031 and increases the relevant transaction value threshold from $1.5 million to $2.5 million.
ASIC updates relief for managed discretionary account service providers
Who is this relevant for? Funds management
ASIC has remade its managed discretionary account (MDA) relief as ASIC Corporations (Managed Discretionary Account Services) Instrument 2026/720, which continues regulatory relief for MDA providers and external MDA custodians without substantive change.
Minor adjustments include extending the timeframe for notifying ASIC of non-compliance from 10 to 30 days and phasing out quarterly reporting where investors have electronic access to account information.
ASIC also updated RG 179 Managed discretionary accounts to reflect the new instrument.
Regulatory guidance, commentary and consultation
APRA releases proposals to strengthen trustee investment governance
Who is this relevant for? Superannuation
The Australian Prudential Regulation Authority (APRA) has released a discussion paper and draft Prudential Standard SPS 530 Investment Governance for consultation to strengthen trustee investment governance and better protect members’ retirement savings.
The proposed standard would require trustees to implement member-level investment limits for higher-risk investments, strengthen the management of investment-related conflicts and ensure investment oversight capabilities are proportionate to the size and complexity of their investment menus. APRA has also proposed codifying and strengthening requirements related to investment onboarding, monitoring, remediation, valuations and accountability.
The proposals address weaknesses identified in APRA’s 2025 review of platform trustee practices and are expected to have the greatest impact on those trustees.
APRA expects to finalise the standard in the first half of 2027 and, subject to consultation, expects the new framework to commence on 1 January 2028.
Submissions close on 3 February 2027.
ASIC moves to extend and strengthen CFD consumer protections
Who is this relevant for? Retail investors
ASIC has commenced consultation on proposals to extend and amend the consumer protection measures governing contracts for difference (CFDs), including extending the existing product intervention order for a further 10 years.
The proposed changes would expand the definition of CFDs to cover settlement by digital asset transfer and clarify requirements relating to initial margin, netting, permitted discounts and educational or research tools. ASIC is also consulting on whether certain CFDs over options should remain available to retail investors.
Submissions close on 9 November 2026.
AUSTRAC begins issuing infringement notices to non-enrolled businesses
Who is this relevant for? Reporting entities
The Australian Transaction Reports and Analysis Centre (AUSTRAC) has commenced issuing infringement notices to businesses in the real estate, accounting and jewellery sectors that it believes failed to enrol with AUSTRAC within 28 days of providing a designated service, as required under Australia's anti-money laundering and counter-terrorism financing (AML/CTF) laws. The enforcement action follows formal requests for information issued by AUSTRAC in August 2026 to businesses that had not enrolled but appeared to be providing designated services.
The notices carry penalties of $21,840 for corporate entities and $4,368 for individuals, which can accrue daily while the failure continues. AUSTRAC said around 90% of businesses it had initially raised concerns with had since enrolled or attempted to do so and warned that further infringement notices would follow for continued non-compliance.
The AML/CTF regime expanded on 1 July 2026 to cover businesses in sectors including real estate, legal services, accounting, conveyancing, trust and company services, and dealing in precious stones and metals.
ACCC consults on Linfox Armaguard's proposed cash distribution undertaking
Who is this relevant for? Banks
The Australian Competition and Consumer Commission (ACCC) has sought the views of retailers, banks and other interested parties on a proposed undertaking from Linfox Armaguard Pty Ltd relating to cash distribution services. The proposed undertaking covers Armaguard's interim prices, service offering and national coverage, and the access to cash centres it grants to third parties, as well as a complaint handling process, dispute resolution and independent audits.
The consultation follows the Reserve Bank of Australia's designation of Linfox Armaguard on 3 September 2026 as a designated entity under the Cash Distribution Framework Act 2026. As a designated entity, Linfox Armaguard is now subject to obligations administered and enforced by the ACCC. If accepted, the undertaking would apply while the ACCC assesses long-term pricing and service levels for Armaguard's cash distribution services.
Submissions close on 16 October 2026.
ASIC releases 2026–27 supervisory priorities
Who is this relevant for? All financial institutions
ASIC has published its 2026-27 supervisory priorities for the banking, superannuation, general insurance, life insurance and financial markets sectors.
Banking: ASIC will review the use of AI in customer-facing activities and will review lender conduct practices, such as incentives, referrer arrangements and broker oversight. ASIC will continue to focus on banks getting the basics right and improving outcomes for those in financial difficulty.
Superannuation: ASIC will continue its multi-year review of superannuation member services and begin new reviews on trustee oversight of advice fee deductions and retirement.
General insurance: ASIC will review the practices of for-profit claims management firms (including those commonly referred to as ‘disaster chasers’) and the implications of some firms’ practices for consumers.
Life insurance: ASIC will review life insurance practices related to funeral insurance and continue its review into service issues in life insurance.
Markets: ASIC will promote market integrity and responsible innovation through surveillance and public-private initiatives, assisted by industry engagement and intelligence. ASIC will also reduce friction, support capital mobility, facilitate growth and competitiveness in Australia’s capital markets and strengthen resilient market infrastructure, focusing on confidence and fair outcomes across public and private markets.
This follows the release of ASIC's Corporate Plan in late August, which we wrote about in this Insight.
BCCC Annual Report 2025-26
Who is this relevant for? Banks
The Banking Code Compliance Committee (BCCC) has released its 2025–26 Annual Report, highlighting where bank practices have improved and where further action is needed.
Of particular interest to financial institutions, the report emphasises stronger breach-reporting requirements under the 2025 Banking Code, greater scrutiny of banks' management of vulnerable customers and a future move towards named reporting in BCCC thematic inquiries and reviews. The BCCC also signalled upcoming work on debt sales, improving communication for customers in financial difficulty and the independent review of both the Banking Code and the Committee's effectiveness.