Overview of Bullion in AML
- Meaning: Gold, silver, platinum or palladium authenticated to a specified fineness and used for trading, commonly as bars or coins.
- Why it matters: Bullion is a high value store of wealth and a common layering vehicle, so bullion transactions attract focused AML and CTF controls.
- Reform change to watch: The AML and CTF Amendment Act 2024 updates the statutory definition of bullion to improve clarity, including reference to markings and spot price trading.
- Tranche 2 link: Dealers in precious metals and stones are part of the newly regulated services from 2026.
What is bullion
AUSTRAC defines bullion as gold, silver, platinum or palladium authenticated to a specified fineness, in the form of bars, ingots, plates, wafers or similar forms, or in coins, used for trading.
Bullion is not jewellery. It is not a collectible coin traded mainly for rarity. It is typically a product whose price tracks the metal content and market price.
Bullion definition under the AML and CTF Amendment Act 2024
The AML and CTF Amendment Act 2024 updates the definition of bullion in the AML and CTF Act. The updated definition describes bullion as gold, silver, platinum or palladium that is in a mass form such as a bar, coin, ingot, plate or wafer, bears a mark or characteristic generally accepted as identifying and guaranteeing fineness and quality, and is usually traded at a price determined by reference to the spot price of the metal.
This is important for two reasons.
First, it improves clarity for businesses and supervisors on what counts as bullion in a compliance setting. Second, it supports the expansion and better framing of obligations for dealers in precious metals and stones as part of the broader reform package.
Why bullion is a money laundering risk
Bullion is attractive to criminals because it is high value, relatively portable, and can be bought and sold quickly. It can be used for placement of illicit cash into an asset, layering through repeated buy sell activity, and integration where metal proceeds appear legitimate.
Bullion also fits well with typologies such as third party purchasing, nominee arrangements, rapid resale, and transactions that do not match the customer’s apparent wealth.
The risk is amplified when a business accepts large cash payments, allows third party payments, or does not properly document source of funds and source of wealth.
Bullion and Tranche 2 reforms for dealers in precious metals and stones
The Australian Government reform material explains that the Amendment Act establishes new designated services that will trigger AML and CTF obligations for certain businesses, including dealers in precious metals and stones.
AUSTRAC has also confirmed staged implementation and that AML and CTF obligations start for Tranche 2 entities on 1 July 2026, with enrolment opening 31 March 2026.
For bullion focused businesses, the practical message is clear. Your controls must be ready before you accept regulated transactions under the new regime.
Examples of bullion in scope
What, how, why, when guidance for bullion compliance
What should you capture in your files
Record product details, weight, fineness, marks, price basis, payment method, delivery method, and customer identity. If the customer is buying bullion for investment, document the rationale and funding.
How to apply a risk based approach
When bullion is involved, common risk drivers include cash use, third party involvement, speed, unusual behaviour, complex ownership structures, and offshore links.
Why your documentation matters
AUSTRAC’s reform direction is moving towards clearer outcomes and risk focus. Your file should show that you understood the customer, assessed risk, and applied controls proportionately.
When to use enhanced due diligence
Use enhanced due diligence when the transaction is large, the customer profile does not match, the funding explanation is weak, or the customer seeks anonymity. Enhanced due diligence should include stronger source of funds evidence and deeper verification of beneficial ownership where relevant.
Best practice controls for bullion dealers and Tranche 2 businesses handling bullion
Define acceptable payment methods and set thresholds for escalation, especially where cash or third party payments are proposed.
Verify identity properly and ensure staff know when certified copies are required for remote onboarding or higher risk cases.
Document source of funds and source of wealth in plain language. Bank statements alone rarely explain legitimacy.
Control delivery risk by matching delivery address to the customer and checking unusual collection behaviour.
Train staff on bullion red flags so they understand why bullion is regulated and what suspicious behaviour looks like.
Common challenges
Confusion between bullion, jewellery, and collectible coins
Over reliance on customer self declarations without corroboration
Weak handling of third party payments and nominee arrangements
Poor record keeping that fails to explain why a transaction was accepted
How Tranche 2 Consultants can help
Tranche 2 Consultants supports bullion businesses with end to end readiness. This includes your AML and CTF program, customer due diligence procedures, staff training, red flag guides for bullion, and governance support so you are ready to enrol and comply by 2026.
Concluding remarks
Bullion is a straightforward product with complex risk. Clear definitions, good customer due diligence, and strong record keeping are what keep bullion businesses safe and compliant under Australia’s reformed AML and CTF regime.
“Bookmakers sit at a natural convergence point for cash, speed and anonymity. AUSTRAC’s focus reflects the reality that wagering platforms can be misused as value transfer mechanisms if risk controls are not actively applied.”
