The new AML/CTF Act makes clear that new anti-money laundering obligations will apply to some legal services (known as designated services). These  include services assisting clients to:

• buy, sell or transfer real estate,
• buy, sell or transfer legal entities,
• receive, hold, control or manage their funds and/or property, for example, money, accounts, securities or assets,
• sell or transfer a shelf company,
• carry out some transactional work, including equity and debt financing, and
• create or restructure a legal entity or legal arrangement.

The new AML/CTF Act also captures services where the solicitor:

• acts (or arranges for another person to act) as a director, partner, trustee, or pursuant to a power of attorney, etc,
• acts (or arranges for another person to act) as a nominee shareholder, and
• provides a registered office address or principal place of business.

Solicitors can sometimes either wittingly or unwittingly be used to facilitate money laundering. The new AML/CTF Act closes the regulatory gap and brings Australia in line with international standards set by the Financial Action Task Force. The reforms will strengthen Australia’s AML/CTF regime and protect the community from serious and organised crime.

There will be staged commencement for solicitors who provide designated services. Solicitors will be required to assess the services they provide and any associated money laundering and terrorism risks and enrol with the regulator (AUSTRAC).

Solicitors who provide a designated service can begin to enrol with AUSTRAC on 31 March 2026. 

Broadly, obligations for solicitors who provide a designated service will commence on 1 July 2026. However, solicitors who come under the new AML/CTF Act should be aware that considerable preparatory compliance work will need to be undertaken prior to the formal obligations commencing. 

On 11 December 2024, AUSTRAC released the first Exposure Draft AML/CTF Rules. Feedback was due by 14 February 2025.  This will be followed by the release of the second Exposure Draft. The draft AML/CTF Rules set out the specific requirements for reporting entities as well as exemptions.  

AUSTRAC is currently consulting with industry on guidance material, which will contain information about how reporting entities can meet their obligations.  It will also set out the tools available to captured entities. 

The NSW Law Society continues to work closely with the Law Council of Australia and AUSTRAC to try and ensure the regulatory impact to the profession is minimised as much as is practicable, and provide further guidance for solicitors.

Under the new AML/CTF Act, solicitors providing a designated service will be required to put in place a comprehensive set of measures including:

• enrol with AUSTRAC,
• develop, and comply with, an AML/CTF compliance program,
• carry out customer due diligence,
• provide certain reports to AUSTRAC, 
• comply with record keeping obligations, and 
• appoint an AML/CTF Compliance Officer

While the AML/CTF Rules and Guidance are yet to be finalised, solicitors should start to familiarise themselves with the obligations under the new AML/CTF Act now.

To assist solicitors, the Law Society of NSW has made available a new complimentary on-demand interactive course that informs practitioners on how they can prepare their practice for Australia’s amended AML/CTF regime. The course provides an update on Australia’s AML/CTF reforms, including what is meant by a ‘designated service,’ as well as an overview of solicitor and practice obligations under the amended AML/CTF Act. 

The Law Society has also released two webinars featuring AML/CTF experts discussing the effect of AML/CTF reforms on solicitors and what the experience has been in other jurisdictions. Solicitors can register for this complimentary webinar here. 

The Law Society’s Professional Support Unit has been expanded to include a new dedicated hotline specifically to assist practitioners with AML/CTF related inquiries. Practitioners with AML/CTF inquiries can call (02) 9926 0249 or email amlctf@lawsociety.com.au for information.