Anti-money laundering and counter-terrorism financing (AML/CTF) law help deter, detect and disrupt money laundering and terrorism financing. To align with international standards, the Federal Government introduced new AML/CTF law, which applies to law firms providing certain services in Australia from 1 July 2026.
What changes does the new law bring?
From 1 July 2026, we will be required to:
a. Carry out due diligence on clients, which involves:
• Verifying your identity;
• Collecting information about your source of wealth and more specifically, funds being used in your matter for certain transactions; and
• Asking whether you are a politically exposed person (PEP) or family member of a PEP. A PEP is someone who holds a prominent public position, such as in government, the courts or military;
b. Comply with mandatory reporting obligations to Australian Transaction Reports and Analysis Centre (AUSTRAC); and
c. Maintain and keep certain records.
Additional information
If you are a company, trust or other structure (i.e., partnership), we may need to:
a. Obtain information or documentation about ownership (i.e., trust deed or partnership agreement);
b. Collect information about individuals who act on behalf of a company, trust or other structure;
c. Seek information about you from third party data suppliers, such as conducting a company search.
To ensure we have current information about our clients, we may request for further information from you on an ongoing basis.
How will these changes affect me as a client?
Our engagement process will change as this information will need to be provided to us before we commence any work. If you cannot provide the requested information or we are unable to verify the information received, we may not be able to act for you in order to comply with our AML/CTF obligations. We will try our best to implement these new obligations into our firm procedure to ensure a seamless transition.
Any information provided to us will be used only for the purposes of complying with the AML/CTF laws and kept for seven years. Please be aware that we have an obligation to report any suspicion of money laundering or terrorism financing to AUSTRAC, which might include reporting client confidential information. We may also have to stop acting for you if by continuing to act we breach our ethical duties and professional responsibilities.
If you have any questions, please contact our office.
