What triggers an SMR
The trigger is the formation of a suspicion. Suspicion is a low threshold, materially lower than proof or even reasonable belief. If something about a customer or transaction does not add up and you have a defensible reason to think it might involve criminal proceeds, an SMR is the right call.
Common triggers across Tranche 2 verticals: deposit funds wired from an unrelated third party, structured payments staying below threshold, source-of-funds documentation that does not match the customer's profile, customer reluctance to provide identification, unusually complex beneficial-ownership chains for the transaction value.
- Real estate: foreign buyer with unexplained source of wealth
- Conveyancing: deposit funds from unrelated third party
- Accounting: client request for opaque trust structure
- Law: client request to act in structuring with ownership-obscuring features
- Any vertical: unusual transaction pattern, customer evasion on ID requests
Writing the SMR
The SMR contains: the customer's identifying details, the transaction details, the basis for the suspicion (in plain narrative), the supporting evidence, and the practice's contact details. AUSTRAC uses the narrative section heavily; vague or boilerplate narratives are less useful to AUSTRAC and harder to defend in an inspection.
Caltury's SMR workflow walks through each section with structured prompts and produces a narrative draft in the AUSTRAC-required schema. You review, edit and sign the final version. Lodgement is in AUSTRAC Online; Caltury keeps the lodged version and the supporting evidence in the retention vault.
Confidentiality and the tipping-off offence
SMRs are confidential. The Act prohibits telling the customer (or anyone outside the practice) that an SMR has been lodged or is being considered. This is the tipping-off offence and it is serious. Continue providing the designated service if you remain in the engagement; do not disclose the SMR.
If the suspicion is so significant that you cannot continue without forming or appearing to disclose it, you may need to disengage. That decision sits with the named Compliance Officer and is recorded in the practice's customer file.
Common questions
How long do I have to lodge an SMR?
Within 3 business days of forming the suspicion. The clock starts when the suspicion crystallises, not when the underlying transaction occurred.
What if I am not sure the suspicion meets the threshold?
AUSTRAC's guidance is that suspicion is a low threshold and reporting entities should err on the side of lodgement. Defensive over-reporting is preferable to under-reporting under the Act. Caltury's workflow is designed to make over-reporting the easier path.
Can I lodge an SMR through Caltury directly?
No. AUSTRAC Online is the lodgement channel and accepts only the practice's own submission. Caltury produces a draft in AUSTRAC schema; the named Compliance Officer reviews and lodges in AUSTRAC Online.
What if AUSTRAC asks for more information after the SMR?
AUSTRAC's typical response is acknowledgement only. They may follow up with additional questions; the practice responds and Caltury retains the correspondence in the customer file alongside the original SMR.
This page is general information about Australian AML/CTF obligations. It is not legal advice. AUSTRAC has not reviewed this content. For situations specific to your practice consult an Australian-qualified lawyer or AML/CTF adviser.