Banks and other organisations with reporting responsibilities under anti-money laundering and counter-terrorism financing legislation will have to conduct far more comprehensive customer due diligence from June 1, under changes to AML/CTF regulations.Reporting entities will have to identify the "beneficial owners" of customer accounts, defined as any individual or individuals owning more than 25 per cent of the account.The AML/CTF regulator, Austrac, issued a series of notices yesterday, setting out the final form of the new rules and transition arrangements.A transition period will run from June 1 to December 31 next year. Reporting entities are required to comply with the new provisions "as soon as practicable". They must have a transition plan in place by November and achieve full compliance by the beginning of 2016.Under the new rules, reporting entities will have to collect the name, date of birth and residential address of each beneficial owner. They will have to take "reasonable measures" to verify this information.Reporting entities will be required to understand "the nature and purpose" of their business relationships with their customers. They must consider the "control structures" of their non-individual customers, such as companies, trusts, partnerships associations and registered co-operatives.Rules covering politically exposed persons have been tightened and extended to cover beneficial owners. A reporting entity's AML/CTF program must include a risk management system to determine whether a customer or beneficial owner is a PEP.There are enhanced customer due diligence measures where the customer is a foreign PEP or the customer has a beneficial owner who is a foreign PEP.Changes to Austrac's customer due diligence rules been made as a result of a review by the Financial Action Task Force (a global standards body) in 2012, which found that Australia's regime did not meet international standards.Under current Australian rules it is left to the discretion of reporting entities to decide whether to undertake further checks in order to understand the beneficial ownership structures. Austrac said this discretion had led to inconsistent practice.It said: "Many reporting entities are not undertaking customer due diligence beyond the minimum threshold mandated. The regulator's view is that these reporting entities may have a limited ability to understand the full spectrum of risks presented by their customers."