Why Australian law and accounting firms are now formally entering the AML/CTF regime — and what that means for 2026

Australia is now implementing the most significant expansion of its anti-money laundering framework since the original AML/CTF Act was introduced in 2006. After more than a decade of consultation, delay and international pressure, the government has passed the Anti-Money Laundering and Counter Terrorism Financing Amendment (Enhancing the AML/CTF Regime) Act 2024 (Cth). The Act expands the AML/CTF regime to additional high risk services provided by lawyers, accountants, trust and company service providers, real estate professionals and other Tranche 2 entities.

This is not a proposal or a policy direction. It is enacted legislation with a phased commencement. From 31 March 2026, law and accounting firms providing designated services must enrol with AUSTRAC. From 1 July 2026, those same firms become reporting entities under the AML/CTF Act, with full obligations applying from that date. This shift moves the professions from a world of “expected good practice” into one of statutory compliance.

A structural change driven by international pressure

Australia has been under sustained scrutiny from the Financial Action Task Force (FATF) since its 2015 Mutual Evaluation Report, which identified the absence of AML/CTF obligations for lawyers, accountants and real estate professionals as a major deficiency. Follow‑up reports repeated the finding. Comparable jurisdictions — including the UK, Canada, Singapore and, increasingly, the United States through its transparency reforms — already regulate these professions.

The 2024 Amendment Act is Australia’s formal response. It closes a long‑criticised gap and brings the country into alignment with international standards. For professional firms, this means expectations that have been building informally for years will now be backed by legislation, supervision and enforcement.

What the new regime actually requires

From 2026, firms providing designated services will need to demonstrate a structured, risk‑based approach to AML/CTF compliance. The core obligations are not new in concept — AUSTRAC has applied them to financial institutions for years — but they will be new in application for many professional practices.

The essentials include:

  • a documented AML/CTF program tailored to the firm’s risks
  • customer due diligence, including identification, verification and beneficial ownership checks
  • ongoing monitoring of client activity and changes in risk
  • suspicious matter reporting to AUSTRAC
  • recordkeeping for prescribed periods

These are statutory requirements, not optional enhancements. Firms will need to show not only that they have policies, but that those policies are applied consistently and supported by evidence.

High‑risk work and the gatekeeper role

Australian firms routinely sit at the centre of transactions and structures that AUSTRAC and FATF identify as high‑vulnerability areas: cross‑border investment, private wealth and family office arrangements, trusts, corporate vehicles, real estate transactions and layered ownership structures. These activities are precisely why the professions are being brought into scope.

The new regime is designed to ensure that firms handling this type of work apply structured, documented controls rather than relying on informal judgment or professional instinct. The shift is not about changing the nature of the work — it is about changing the level of discipline applied to understanding who the client is, what the matter involves and where the risks lie.

Digital identity and remote onboarding

Australia has embraced digital identity solutions more quickly than many jurisdictions, and AUSTRAC has long supported their use. But AUSTRAC’s guidance has always been clear: technology must be accompanied by human oversight. Under the 2024 reforms, firms will need to demonstrate how identity was verified, how beneficial ownership was established, how anomalies were resolved and how the audit trail was maintained.

This is not a technology requirement; it is a governance requirement. Digital tools can support compliance, but they cannot replace professional judgment.

Enforcement will follow

AUSTRAC has a well‑established enforcement record across banks, casinos and remitters. Its approach is risk‑based, data‑driven and increasingly assertive. While the professions have not previously been supervised by AUSTRAC, the regulator has made clear that gatekeeper professions will be supervised with the same intensity once they enter the regime.

The 2024 Amendment Act gives AUSTRAC the mandate to do exactly that. Firms should expect supervision, thematic reviews, guidance updates and — where necessary — enforcement action.

The significance of 2026

For the first time, Australian law and accounting firms will operate under a formal, legislated AML/CTF regime. This is not a soft expectation or a market‑driven standard. It is a statutory shift with fixed commencement dates and clear obligations.

2026 will require firms to demonstrate:

  • structured risk assessment
  • documented customer due diligence
  • clear beneficial ownership verification
  • ongoing monitoring
  • suspicious matter reporting
  • defensible recordkeeping

This year’s content series will unpack each of these areas in detail, beginning with AML/CTF program design, BOI verification and preparing for AUSTRAC supervision.

Start here by downloading our compact, 2 page Readiness Checklist.