Important Changes Are Coming To Property Transactions

From 1 July 2026, conveyancers, lawyers, real estate professionals and other property industry participants will be required to comply with new Anti-Money Laundering and Counter-Terrorism Financing (AML/CTF) laws.

These reforms are being introduced by the Australian Government and administered by AUSTRAC (Australian Transaction Reports and Analysis Centre). Their purpose is to help prevent money laundering, terrorism financing, fraud and other financial crimes within Australia's property sector.

For clients, this means that buying or selling property will involve additional identification and verification requirements. You may be asked to provide information and documentation that conveyancers have not previously been required to collect.

While these changes will introduce some additional steps, they are intended to protect the integrity of Australia's property market and align the property industry with obligations that banks and financial institutions have followed for many years.

Why Are These Changes Being Introduced?‍

Property transactions often involve large amounts of money, making them attractive targets for criminals seeking to disguise or move illicit funds.

Historically, banks have been required to undertake extensive identity and financial checks. From 1 July 2026, similar obligations will extend to conveyancers and other property professionals.

The new laws require us to better understand:

Who our clients are
Whether a client is acting on behalf of another person
The nature and purpose of the transaction
The source of funds used in the transaction
Whether there are any unusual circumstances that may indicate increased risk

Customer Due Diligence (CDD)

One of the most significant changes is the introduction of expanded Customer Due Diligence requirements.

Customer Due Diligence goes beyond simply sighting identification documents. It requires conveyancers to take reasonable steps to verify the identity of clients and understand the circumstances surrounding a transaction.

Depending on the matter, we may need to collect additional information and supporting documentation.

Proof of Identity

Identification requirements will remain an important part of the process and may become more comprehensive.

You may be asked to provide:

Australian or Foreign Passport
Driver Licence
Birth Certificate
Medicare Card
Other government-issued identification documents

Verification may be completed through electronic verification providers, biometric matching technology or other independent verification services.

Verification Of Residential Address

In some circumstances, we may also need to verify your residential address.

Documents that may be requested include:

Utility accounts
Council rates notices
Bank statements
Government correspondence

These documents help confirm that the information provided is accurate and current.

Understanding Source Of Funds

A major component of the new AML requirements is understanding where the money involved in a transaction originates from.

For purchasers, this means we may need information about the funds being used to complete the purchase.

Examples include:

Personal savings
Home loan proceeds
Funds received from the sale of another property
Inheritance payments
Investment proceeds
Family gifts
Business income

Depending on the circumstances, supporting evidence may be requested.

This could include:

Bank statements
Loan approval documents
Settlement statements
Gift declarations
Investment account records

The purpose of these enquiries is not to assess your financial position, but to satisfy regulatory obligations imposed on conveyancers under the AML/CTF framework.

Source Of Wealth

In some higher-risk situations, we may also need to understand the broader origin of a client's wealth.

Source of wealth is different from source of funds.

While source of funds focuses on the money being used for a specific transaction, source of wealth relates to how a person accumulated their overall financial position.

This may be relevant where:

Transactions involve large sums
Funds originate from multiple sources
There are complex ownership structures
Politically Exposed Persons (PEPs) are involved
Additional risk factors are identified

Where required, we will explain exactly what information is needed and why.

Ongoing Monitoring Throughout Your Matter

The new legislation requires conveyancers to undertake ongoing due diligence throughout a transaction.

This means that verification obligations do not necessarily end once a file is opened.

If circumstances change during the course of a transaction, we may need to request updated information or additional supporting documentation.

Examples may include:

Changes to ownership arrangements
Changes to funding sources
Unexpected third-party contributions
Significant amendments to transaction details

The Role Of Your Conveyancer Under The New AML Laws

From July 2026, conveyancers will have legal obligations that extend beyond traditional conveyancing services.

These responsibilities will include:

Customer Due Diligence

Verifying client identities and assessing the level of risk associated with each matter.

Ongoing Monitoring

Reviewing transactions and client information throughout the course of a matter where required.

Suspicious Matter Reporting

Where required by law, conveyancers must report certain suspicious activities or transactions to AUSTRAC.

Importantly, legislation prevents professionals from informing clients when a report has been submitted.

Record Keeping

Conveyancers must maintain records relating to identification, verification and due diligence processes for prescribed periods under the legislation.

Staff Training And Compliance Programs

All regulated firms will be required to maintain AML/CTF compliance programs and ensure staff are appropriately trained to meet their obligations.

What Will This Mean For Clients?

For most buyers and sellers, the impact will simply involve providing some additional information at the start of a matter.

Clients who prepare documents early and respond promptly to requests are unlikely to experience significant delays.

However, transactions may take longer where:

Information is incomplete
Documents are not provided promptly
Funding arrangements are complex
Additional verification is required

Providing information early will help us keep your matter progressing smoothly.

Frequently Asked Questions

Do the new AML laws apply to both buyers and sellers?

Yes. The obligations apply to conveyancers and other regulated professionals. Depending on the transaction, both buyers and sellers may be required to provide identification and other supporting information.

Will I need to provide bank statements?

Possibly. Where source of funds verification is required, bank statements or other supporting documents may be requested.

What happens if I don't provide the requested information?

The legislation may prevent us from continuing to act or progressing a transaction until the required verification requirements have been satisfied.

Will my personal information remain confidential?

Yes. Information collected for AML compliance purposes will be handled in accordance with privacy laws, confidentiality obligations and regulatory requirements.

When do these changes commence?

The new AML/CTF obligations for conveyancers and other tranche 2 professions commence from 1 July 2026.

Need More Information?

If you have questions about the new AML requirements or the documentation that may be requested during your property transaction, our team is here to assist.

We recommend providing requested information as early as possible to avoid unnecessary delays and ensure your matter progresses efficiently.