New Anti-Money Laundering Laws Starting in 2026

At DW Fox Tucker Lawyers, we’re committed to keeping you informed about changes that may affect our services, and which may affect you if you have a business to which the new laws apply. New anti-money laundering (AML) and counter-terrorism financing (CTF) laws will come into effect in Australia under the Anti-Money Laundering and Counter-Terrorism Financing Amendment Act 2024 (Cth)^[1]. These changes will apply to all law firms like ours, and other affected businesses, and may impact how they work with you. 

Some changes will take effect on 31 March 2026, with the main new obligations applying from 1 July 2026.

What’s changing?

The Australian government is strengthening its laws to prevent money laundering and terrorism financing. Starting 1 July 2026, law firms and other businesses providing a wide range of services (designated services) – such as managing client funds, setting up trusts or companies, or handling real estate transactions – will have new responsibilities to comply with these rules. Some of the legal services that law firms provide on a daily basis will be designated services.

As well as law firms, businesses which may now be affected (known as “tranche two entities”) include:

• Accountants
• Conveyancers
• Real estate professionals
• Trust and company service providers
• Dealers in precious metals and precious stones.

Why this matters

These changes are intended to help safeguard Australia’s financial system and prevent illegal activities like money laundering and terrorism financing. Tranche two entities, recognised as being at high risk of exposure in these areas, will have new responsibilities, such as reporting and record keeping obligations, to assist in combating these activities. By working together, we can ensure everything we do is secure, transparent, and compliant.

How does this affect you?

When you deal with a tranche two entity that provides you with designated services, they will have obligations that could affect you, such as the requirement to undertake due diligence and risk assessments. Here’s what you can expect:

1. Identity Verification: Before undertaking designated services, a tranche two entity may ask you to provide identification documents (like a passport or driver’s licence) to confirm your identity. You may also need to provide information about your vocation and some other personal information.
2. Business Structure: Details of companies and trusts and beneficial owners of your business may be required and, unless you are a sole trader, you will need to verify your authority to act on behalf of the business. Verification of persons who are beneficial owners will require identification documents.
3. Sources of Funds and Wealth: You might be asked about the purpose of your transaction or the source of funds for transactions or overall wealth, particularly where there are higher risks or high amounts or complex arrangements. This helps the tranche two entity better understand your needs and meet its new legal obligations.
4. Other Questions: A tranche two entity may need to ask if you or a beneficial owner is a “politically exposed person”, that is someone who holds, or has held, a prominent public position. This may mean a higher degree of care is required in assessing risk.
5. Ongoing Checks: Due diligence is ongoing. For some matters, tranche two entities will have to monitor transactions to keep an eye out for anything unusual. If something looks unusual, you may be contacted for clarification.
6. Reporting: In some cases, tranche two entities are legally required to report suspicious activities or large cash transactions (over $10,000) to AUSTRAC, the government agency overseeing these laws. This doesn’t mean they suspect you of anything – it’s just part of the new legal obligations.

What you can do now to prepare

1. Get Ready: If you are likely to be engaging in transactions after 1 July 2026, have your identification documents ready, as this will help expedite the compliance process.
2. Ask Us: If you’re unsure how this affects you, whether as a customer of or as a tranche two entity, please don’t hesitate to contact us so we can provide you with the clarity you need.

Privacy and confidentiality

Tranche two entities should treat your information confidentially and have a privacy policy outlining how they use and share your personal information.

We take the privacy of our clients seriously, as demonstrated by our Privacy Policy and our compliance with the Essential Eight cyber security framework^[2]. These new rules won’t change our commitment to protecting the personal and confidential information of our clients.

Legal professional privilege still applies, meaning any advice we give to our clients or confidential documents brought into existence for the purposes of giving advice or for conducting litigation remain protected under the law.

Questions?

We’re preparing for these changes to make the transition as smooth as possible for our clients. If you’d like to know more, contact us at compliance@dwft.au or (08) 8124 1811. 

Thank you for trusting us to help you with your legal matters.