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Anti-money laundering and counter-terrorism financing

What you need to know

Major reforms to the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (Cth) will take effect for legal practitioners from 1 July 2026.

AUSTRAC is Australia’s Anti-money laundering and counter-terrorism financing (AML/CTF) regulator. AUSTRAC expects a law practice that will come under their regulation to have the following in place by 1 July 2026:

  • be enrolled as a reporting entity. You will be able to access the online enrolment system from 31 March 2026
  • have an AML program, either because you have adopted the starter program provided by AUSTRAC or have developed your own. The starter program will be available in December 2025
  • have an AML/CTF Compliance Officer
  • have trained your staff on your AML/CTF program and processes
  • be ready to ask clients questions and report suspicious activity.

The Legal Practice Board (Board) acknowledges the importance of Australia’s AML/CTF framework and supports the extension of AML/CTF obligations to the legal profession, where necessary, to mitigate the risks posed by certain business and financial activities. The Board supports a cooperative regulatory model, with AUSTRAC as the lead authority, ensuring consistency and coordination in overseeing AML/CTF. 

However, the Board also advocates for a balanced approach that does not unduly burden legal services or increase the regulatory costs for small or low risk law practices.

The Board is the designated local regulatory authority for the regulation of legal services in Western Australia under the Legal Profession Uniform Law (WA) (Uniform Law).  The Uniform Law’s statutory objectives include: 

  • enhancing the protection of clients of law practices and the protection of the public generally
  • promoting regulation of the legal profession that is efficient, effective, targeted and proportionate.

With that in mind the Board has endorsed its Strategic Direction and its Regulatory Approach Statement, which guide the Board’s approach to delivering its legislative responsibilities, as well as how regulatory priorities are set, resources are allocated, and the range of regulatory tools at its disposal are applied, to best manage risk.

The Board is committed to ensuring that legal services are provided to the public by competent and ethical legal professionals so that public trust and confidence in the legal profession is maintained.

Although the Board’s activities are focused on consumer protection, the existing oversight of solicitor trust accounts delivers some level of AML/CTF alignment, especially through the recordkeeping and monitoring obligations required under the trust accounting provisions of the Uniform Law.

The trust accounting regime, however, is just one aspect of the extensive ethical obligations imposed upon lawyers. One of the central obligations is the paramount duty to the Court and the administration of justice. The Legal Profession Uniform Law Australian Solicitors’ Conduct Rules 2015 require lawyers to act only upon the lawful and proper instructions of clients and to be honest and avoid compromises to their integrity. The Board’s Regulatory Approach Statement sets out a wide range of sanctions that can be imposed upon lawyers for ethical breaches.

These ethical obligations mitigate against the misuse of the legal profession for unlawful purposes and while awaiting formal inclusion into the AML/CTF regime the Board expects lawyers to:

  • verify their client’s identity, particularly when receiving cash
  • enquire into the source of client’s funds, especially when large amounts are involved 
  • comply with AUSTRAC’s existing reporting rules around significant cash transactions.

To see how these reforms may affect you and your law practice, please go to the comprehensive AML /CTF Hub maintained at the Law Society of Western Australia and the AUSTRAC website at Education and guidance | AUSTRAC.

If you have any queries relating to AML/CTF and the Legal Practice Board please contact Stephen Ramsay, Director Risk Mitigation and Review at TAI@lpbwa.com