Anti-Money Laundering Compliance in Conveyancing Transactions: What Clients Can Expect

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From 1 July 2026, Australian lawyers and conveyancers providing certain conveyancing and property-related services became subject to the Anti-Money Laundering and Counter-Terrorism Financing (AML/CTF) regime under Australia's "Tranche 2" reforms. These reforms significantly change the way property transactions are conducted by requiring legal professionals to verify clients, assess money laundering risks and report suspicious activities to AUSTRAC. The reforms are designed to prevent criminals from using real estate transactions to launder the proceeds of crime or finance terrorism.

The AML/CTF legislation adopts a risk-based approach. Most ordinary residential conveyancing matters involving local purchasers will generally present a relatively low risk and can be completed with straightforward identity and verification procedures. However, transactions involving complex ownership structures, foreign entities, large cash payments, politically exposed persons, unusually complicated arrangements or unexplained sources of funds may require enhanced due diligence before the transaction can proceed.

While the additional compliance procedures may require clients to provide more information at the commencement of a matter, they ultimately help protect the integrity of Australia's property market, reduce fraud and financial crime, and ensure that conveyancing transactions are conducted transparently and securely. Clients who provide the requested documentation promptly will usually experience minimal delay, allowing their legal representatives to proceed efficiently while complying with their statutory obligations.