Suspicious Matter Reporting for Precious Metals Dealers
How Australian precious metals and stones dealers identify, assess, and lodge suspicious matter reports with AUSTRAC from 1 July 2026.
From 1 July 2026, Australian precious metals and stones dealers providing designated services under the AML/CTF Act 2006 must file a suspicious matter report (SMR) with AUSTRAC when they have reasonable grounds to suspect money laundering, terrorism financing, or serious crime. Now that Tranche 2 has commenced, understanding what triggers an SMR, how to lodge one, and the tipping-off prohibition are essentials for every dealer.
What is a suspicious matter report?
An SMR is a formal report submitted through AUSTRAC Online when there are reasonable grounds to suspect a transaction or customer is connected to money laundering, terrorism financing, proceeds of crime, or tax evasion. Unlike a threshold transaction report — triggered automatically by cash of $10,000 or more — an SMR is driven by the dealer's assessment of the circumstances, not a fixed dollar amount. For threshold reporting obligations, see threshold transaction reporting for precious metals dealers.
What red flags should dealers watch for?
- Structured cash purchases — multiple transactions just below $10,000 in a short period, suggesting deliberate splitting
- Third-party payments — the person paying differs from the person taking delivery, without a documented explanation
- Customers who cannot explain a purchase — or whose explanation is inconsistent with their apparent profile
- Reluctance to verify identity — declining standard verification, insisting on no written record, or evasive about the transaction's purpose
How do you lodge an SMR with AUSTRAC?
SMRs are lodged through the AUSTRAC Online portal. Your programme should specify: 1. Document the suspicion as it forms — record what you observed and why it raised concern; retain for seven years 2. Escalate to the AMLCO — frontline staff should refer potential SMR matters before a report is submitted or the transaction proceeds 3. Lodge within three business days — the clock runs from when suspicion first forms, not when the transaction settles 4. Apply the tipping-off prohibition — no one at the firm should disclose that an SMR has been or may be lodged
What is the tipping-off prohibition?
The tipping-off prohibition is a criminal offence under the AML/CTF Act 2006. It prohibits any person at the entity — frontline staff, the AMLCO, and management — from disclosing that an SMR has been, is being, or may be lodged. Train staff to handle suspicious transactions without alerting the customer, and include in your programme how staff should respond if a buyer questions a refusal or delay.
Key Takeaways
- SMRs are triggered by reasonable suspicion, not a dollar amount — a low-value purchase can require a report if circumstances raise concern
- Red flags include structured cash splits, third-party payments, and customers who cannot explain a transaction — document every assessment at the time it forms
- Lodge within three business days via AUSTRAC Online; late lodgement is a contravention
- The tipping-off prohibition is a criminal offence — ensure all staff are trained
- Get compliant now — AMLify for dealers includes SMR workflows and tipping-off safeguards
Frequently Asked Questions
Q: How long do dealers have to lodge an SMR?
Three business days from when reasonable suspicion first forms — not from when a transaction settles or the AMLCO receives the escalation. Late lodgement is a contravention of the AML/CTF Act 2006 even when the underlying suspicion is genuine.
Q: Does every unusual transaction require an SMR?
No. The test is reasonable suspicion — objective grounds to suspect money laundering, terrorism financing, or serious crime. An unusual transaction with a plausible, documented explanation does not require a report. Document every SMR assessment, including decisions not to report, to create a defensible record for any future AUSTRAC review.
Q: Can you refuse a suspicious transaction rather than complete it?
Yes. Your customer acceptance policy can specify when you will decline a transaction. Declining does not remove the obligation to lodge an SMR — if suspicion has formed, report within three business days regardless of whether the transaction proceeded.
This is general information only and not a substitute for legal advice.