From 1 July 2026 onwards, the way a solicitor is allowed to take on your matter changes. AML/CTF regime now reaches law firms, conveyancers, accountants, real estate professionals, and dealers in precious metals and stones. For new clients or existing clients with new matters, this update sets out what changes at the front of the relationship and what you can do in advance so your matter moves without delay.
We want to be direct. Our compliance preparation is well advanced, and we are setting up so that the new checks add as little friction to your matter as the rules allow. But the checks are legally required, and the sooner you understand what the new regime expects, the sooner we can get to the work you have asked us to do.
In March 2026, the CEO of ASX-listed Electro Optic Systems (EOS) sold 1.5 million shares at $9.28 each, raising roughly $13.9 million to fund a house purchase and a divorce Settlement. EOS’s share price fell between 17 and 25 per cent within days of the disclosure. Other executives flagged their own sales.
One personal financial event wiped hundreds of millions in shareholder value.
EOS is a listed company, so the event was public. The same pattern plays out privately across Queensland every week. Business owners liquidate assets below market value to meet Settlement deadlines. Superannuation splits arrive without forward planning and force tax consequences nobody modelled. Family homes sell under time pressure. The financial cost of separation without preparation reaches well beyond the couple: it touches business partners, co-shareholders, employees, and the wider family.
A Binding Financial Agreement is one way to take that pressure off before it arrives. It is also, increasingly, a way to resolve matters after separation without going through Court.
What is Tranche 2?
The AML/CTF Amendment Act 2024 extends Australia’s AML/CTF regime to professions that have sat outside it for years. On 1 July 2026, the regulator AUSTRAC will move from regulating around 19,000 entities to close to 100,000 nationally, and law firms are in that new count.
From 1 July 2026, law firms must have an AML/CTF program in place which includes:
- a money laundering and terrorism financing risk assessment
- written policies
- Appoint an internal Compliance Officer
- Ongoing staff training, and
- the operational capacity to conduct customer due diligence and submit suspicious matter reports
The Queensland Law Society is running a dedicated roadshow and guidance program for the profession.
Which legal services are within or outside of the new rules
Not every instruction a client gives us falls inside the regime. The law carves out a list of “designated services”: the categories that actually trigger AML/CTF obligations. For law firms, the designated services for professional service providers cover nine categories, including:
Based on AUSTRAC’s guidance, several things sit outside the list: property litigation, general strategic advice that does not directly advance a transaction, court-ordered transfers, and standard Wills do not fall within designated services. Dispute resolution work sits outside the regime as well.
Item 1
In scope
Assisting, planning, organising, or acting for a Buyer or Seller on a transaction to sell, buy, or transfer real estate (fee simple, leasehold over 30 years, or land use entitlement).
What this means
We verify ID for all parties and, for higher-value matters, source of funds before the Contract of Sale progresses.
Out of scope
Transfers pursuant to or resulting from a Court or Tribunal Order; legal-effect advice on a Contract where another professional is driving the transfer; leases of 30 years or less; easements and covenants; Mortgagee interests; mobile homes and caravans.
What this means
Standard ID only; the Order or advice does not directly advance the transaction.
Item 2
In scope
Acting on a transaction to sell, buy, or transfer a body corporate (Company, incorporated association) or legal arrangement (express Trust, partnership, joint venture, foreign equivalent), where a controlling interest changes hands.
What this means
We verify the parties on both sides and beneficial ownership.
Out of scope
Transfers pursuant to Court or Tribunal Order; tax or strategic advice that merely influences the decision to sell; sales not involving a controlling interest.
What this means
Advice alone is not sufficiently linked to the outcome.
Item 3
In scope
Allowing clients to use our trust account for purposes other than paying for the legal fees & costs, receiving or paying Court ordered settlements. For example, using our Trust Account as your own personal bank account to receive and pay or distribute money.
What this means
We verify identity, transaction purpose, and source of funds before property moves through our control.
Out of scope
Trust account activity for our professional fees; money held incidental to non-designated services (for example, a criminal defence firm holding Barrister’s fees); money held pursuant to a Court or Tribunal Order; receipts from government, insurance licensees, Courts, Tribunals, ATO, or bail payments.
What this means
Standard ID only; the holding is not linked to a designated service outcome.
Item 4
In scope
Acting on a transaction for equity or debt financing for an existing or proposed body corporate or legal arrangement (IPOs, capital raises, bonds, loans, debentures).
What this means
We verify the parties, the structure, and the source of funds flowing in.
Out of scope
General advice on financing options; credit rating work; advice that influences a financing decision without directly advancing a specific transaction.
What this means
Advice alone is not sufficiently linked.
Item 5
In scope
Selling or transferring a shelf Company (a Company registered with ASIC that has not traded and holds no assets or liabilities).
What this means
We verify the Buyer or transferee, who is our customer for this service.
Out of scope
No standard exception.
What this means
If you ask us to sell or transfer a shelf Company, the regime applies.
Item 6
In scope
Acting on the creation or restructuring of a body corporate or legal arrangement (drafting Company Constitutions, Partnership Agreements, Shareholders’ Agreements, Trust Deeds for Discretionary Trusts and asset protection arrangements; ASIC registrations; FIRB approvals; merger and demerger documentation).
What this means
We verify beneficial owners and Directors (for Companies), or Settlor, Trustee, and Beneficiaries (for express Trusts), before we act.
Out of scope
Drafting a Will or creating a Testamentary Trust; Trusts created solely by operation of law; advice on internal governance, staffing, or IT systems; post-creation advice on whether an existing structure was lawful; Aboriginal and Torres Strait Islander Act corporations.
What this means
Wills and Testamentary Trusts are explicitly outside the regime.
Item 7
In scope
Acting as, or arranging for another to act as, a Director, Secretary, Power of Attorney for a body corporate or legal arrangement, partner in a partnership, or Trustee of an express Trust on behalf of a nominator.
What this means
We verify the appointee and the nominator instructing the appointment.
Out of scope
Personal Powers of Attorney (for a natural person); Trustee of a Testamentary Trust or Trust not created in writing; fiduciary roles pursuant to a Court or Tribunal Order; Trustee of a regulated debtor’s estate under the Bankruptcy Act.
What this means
Personal Powers of Attorney and Testamentary Trusteeships are outside the regime.
Item 8
In scope
Acting as, or arranging for another to act as, a nominee shareholder who holds shares for a nominator and votes or receives dividends on their instructions.
What this means
We verify the nominee and the nominator before the shareholding is put in place.
Out of scope
Holding shares in your own name with no nominator arrangement.
What this means
Standard shareholdings are not a designated service.
Item 9
In scope
Providing a registered office address or principal place of business for a body corporate or legal arrangement (including foreign equivalent addresses).
What this means
We verify the entity and the directing individuals before the service starts.
Out of scope
Providing an address to a natural person.
What this means
Only body corporates and legal arrangements trigger this service.
A note on matters that can cross the line
Some matters move between in and out of scope as they progress. A Family Law separation that starts as Mediation is out of scope; the moment we act on the Contract of Sale or Transfer to give effect to the settlement, the real estate transaction is in scope. A commercial dispute that resolves by share sale moves in scope at the share transfer.
What this means for you: verify your identity & source of funds
The headline change for clients is that, before we begin any matter, we have to understand who you are, who is behind your entity, and where the money for the transaction is coming from.
Identity. You will be asked to provide identification documents for you as an individual, or as a Director, relevant shareholder, Trustees and settlor. AUSTRAC’s reformed customer due diligence rules set prescriptive requirements for sole traders, companies, partnerships, Trusts, and foreign equivalents. If your structure involves an Enduring Power of Attorney or a company acting for a Trust, expect us to ask for the Trust Deed and to verify the Trustee (s). If we are not able to verify your identity, we may not be able to do any legal work for you.
Source and purpose of funds. For higher-value or higher-risk matters, we will ask you to document where funds are coming from and why. This is not us being intrusive; it is the regime. Expect to be asked to show, for example, sale proceeds statements, loan approvals, superannuation rollover confirmations, or business sale records.
Cash. Cash transactions of AUD 10,000 or more are reportable to AUSTRAC through a threshold transaction report, which must be lodged within 10 business days of the transaction. This is unlikely to touch most clients, but it matters for anyone planning to move physical cash through a legal matter.
What is required after 1 July 2026
Once the regime begins, front-end checks add a step we cannot skip. A few concrete actions:
| If you are... | Then you will need to... |
|---|---|
|
an individual instructing us |
• verify your identification. |
|
an individual instructing us through a Power of Attorney or as a Trustee for someone else |
• verify your identification; and
• provide the underlying instrument. |
|
a business or Trust |
• verify your identification; and
• provide the Trust Deed or Company Constitution
• Director ID details
• and beneficiaries details. |
|
an individual or business or Trust and your matter involves a financial transaction |
• verify the identification for each owner of the asset, and
• know where Settlement funds are coming from and provide source-of-funds documentation. |
Failure to be able to provide us with the necessary front-end checks, may result in us not being able to act for you. Penalities also apply to us if we are found to not be meeting our obligations.
This article is general information only. It is not legal advice and should not be relied upon as such. The AML/CTF regime is complex, and the detailed rules continue to be released in the period before commencement. For advice specific to your situation, contact Griffiths Parry Lawyers & Notary.
Liability is limited by a scheme approved under Professional Standards Legislation.
