Holding shares for somebody else, and where AML/CTF touches it
A nominee shareholding puts one name on the register and a different person behind it. That gap is the reason this service is in the Act at all.
Start here
What a nominee shareholder is
A nominee shareholder is a person or company whose name appears on a share register, holding the shares for somebody else. The name on the register is yours. The shares are not.
There are ordinary reasons for it. A fund manager may hold client holdings through one nominee entity for administrative tidiness. A family may want a professional to hold an interest while an estate is sorted out.
And there is one reason that is not ordinary: a nominee shareholding hides who actually owns a company from anyone looking at the register. That is why the Financial Action Task Force has named nominee arrangements for years, and why this item exists.
How the arrangement works
| What happens | |
|---|---|
| The register says | Your name, or your nominee company’s name |
| The reality is | Somebody else paid for the shares and gets the benefit of them |
| You vote | On the nominator’s instructions, not your own judgement |
| Dividends | Flow through to the nominator |
| What an outsider sees | Your name — which is exactly why the Act is interested |
The shape of it
Four things worth fixing in your head
The person the shares are really for — not the company
Finding a third party to hold as nominee is caught, like holding yourself
Held for another person: caught. Held in your own right: not
Nominee shareholding became a designated service under Table 6, item 8
The line that decides it
Are the shares yours, or are you holding them for someone?
That single question sorts almost every case. If you bought the shares with your own money, take the dividends and vote as you see fit, you hold in your own right and item 8 does not touch you — however large the holding.
If somebody else’s money bought them, somebody else gets the benefit, and you vote as that person tells you, you are a nominee. The paperwork usually says so: a nominee deed, a declaration of trust, a bare trust agreement.
As with director and trustee roles, arranging it counts. Putting your client together with a nominee provider is providing the service, even though your name never reaches the register.
Are you providing it?
Shareholdings, sorted
| The arrangement | Caught? |
|---|---|
| Holding shares on behalf of a client and voting them on the client’s instructions | Caught |
| Arranging for a third party to hold shares as nominee for your client | Caught — arranging |
| A nominee company in your group holding shares for clients | Caught |
| Holding shares in your own right as a genuine investor | Not caught — no nominator |
| Your own staff share plan, where staff hold their own shares | Not caught — they hold in their own right |
What actually gets checked
Six checks, and the whole point is the second one
Establishing who actually benefits is not one check among six here. It is the reason the obligation exists. A nominee arrangement is a deliberate gap between the register and the truth, and you are the person standing in that gap.
| The check | What is required | How it is usually done | What stays in the file |
|---|---|---|---|
| Identify the nominator | Full name, date of birth and residential address of the person the shares are really for | Licence or passport, in person or by digital check | What was collected and how it was verified |
| Establish who benefits | Who ultimately owns or controls the shareholding | The nominee deed or declaration of trust that records the arrangement | The document, and your conclusion from it |
| Screen for PEPs and sanctions | Whether the nominator is politically exposed, and a check against the DFAT Consolidated List | A screening tool, or a manual DFAT search | The result and its date |
| Understand the purpose | Why the shares are not simply held in the owner’s own name | Ask. There are ordinary answers and there are not-ordinary ones | The explanation, recorded |
| Rate the risk | Assess and record the ML/TF risk of the nominator | Your program’s risk factors applied to the person and the structure | The rating and the reasons |
| Keep watching | Monitor for as long as the arrangement lasts | Review when the underlying ownership changes | What you reviewed, when, and what you concluded |
Records are kept for 7 years. This is a continuing service, so monitoring runs for as long as you hold.
The provision itself
Table 6, item 8, in the Act’s own words
“acting as, or arranging for another person to act as, a nominee shareholder of a body corporate or legal arrangement, on behalf of a person (the nominator), in the course of carrying on a business”
Customer: the nominator. Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (Cth), s 6(5B) table 6, item 8 — Compilation No. 62 (C2026C00274).
It is the shortest item in Table 6 and the least ambiguous. There is no threshold, no minimum holding and no exemption for a small parcel.
The thirteen designated services
One article for each service you can select when you enrol
13 of 13 written so far. The rest are in progress.
- ConveyancingEvery step of a settlement, and how CDD differs from the VOI you already do.Table 6, item 1
- Selling a businessWhen a company or trust changes hands.Table 6, item 2
- Client moneyHolding or controlling someone else’s money or property in a transaction.Table 6, item 3
- Equity and debt financingRaising money for a company or legal arrangement.Table 6, item 4
- Shelf companiesSelling or transferring a company created to be sold.Table 6, item 5
- Company and trust formationCreating or restructuring a company, trust or partnership.Table 6, item 6
- Director and trustee rolesActing as, or finding someone to act as, a director, trustee or attorney.Table 6, item 7
- Nominee shareholdersyou are hereHolding shares in your name for somebody else.Table 6, item 8
- Registered officeLetting a client use your address as their registered office.Table 6, item 9
- Real estate agentsThe agent’s customer is both sides of the deal — and the two sides start at different moments.Table 5, item 1
- Property developersSelling your own stock with no agent in between, and why that changes who the customer is.Table 5, item 2
- BullionGold, silver, platinum and palladium, and the $5,000 exemption.Table 2, item 1
- Jewellers and dealersWhy the $10,000 line is about how the customer pays, not what they buy.Table 2, item 2
Sources
Where every figure here comes from
Data as at 27 September 2026.
- Anti-Money Laundering and Counter-Terrorism Financing Act 2006, s 6(5B) table 6 · Federal Register of Legislation · Compilation No. 62 (C2026C00274)Item 8 and its customer definition, quoted verbatim on this page.
- Professional designated services · AUSTRAC · Guidance, current at Sep 2026The worked examples of acting and arranging, and what is not caught.
- FATF Recommendations 24 and 25 — transparency of legal persons and arrangements · Financial Action Task Force · CurrentWhy nominee arrangements are a named international concern, and the origin of the beneficial ownership rules.
- Company and organisation registers · ASIC · CurrentWhat the public share register does and does not show.
Before you rely on this
This content is general information only. It is not legal, financial or compliance advice. Organisations should check AUSTRAC guidance, legislation, their own AML/CTF Program and professional advice where needed.
- Whether a shareholding is held on behalf of another person depends on its own facts and on the documents that record it.
- Nominee arrangements carry obligations beyond AML/CTF, including under the Corporations Act and general trust law. Nothing here addresses those.
- Current as at 27 September 2026.
Lex-AML supports compliance workflows and record keeping. It does not provide legal advice, does not guarantee compliance, and does not replace professional judgement or advice from a qualified AML/CTF adviser or legal professional.
GetPost Labs is a technology company. We are not a law firm and not a compliance adviser, and this page is not a substitute for either.
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