New “Know Your Client” rules in effect from 1 July 2026

New “Know Your Client” Rules Now Effective

Hundt Law is subject to the new “Know Your Client” (“KYC”) regulatory obligations, which took effect on 1 July 2026.

The new rules are designed to prevent criminals from disguising illegally obtained funds as legitimate income.

Background

The KYC obligations are at the centre of Australia’s national Anti-Money Laundering and Counter-Terrorism Financing framework (AML/CTF) established under the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (Cth) (“AML/CTF Act”).

AML/CTF refers to a set of laws, regulations, and procedures designed to prevent criminals from disguising illegally obtained funds as legitimate income.

The AML/CTF Act was passed in 2006 and initially was aimed at certain sectors, such as banks, casinos, and bullion dealers (known as “Tranche 1 entities”).

‍The new obligations that took effect on 1 July 2026 extended AML/CTF obligations and compliance to “Tranche 2 entities” that include other professions, such as legal practitioners, conveyancers, and real estate agents, and accountants.

When do these obligations arise?

Law firms are now required to collect and verify certain client information at the time of commencing certain types of legal work, including:

  • Assisting in the planning or execution of a transaction to sell, buy or transfer real estate

  • Assisting in the planning or execution of a transaction to sell, buy or transfer a body corporate or legal arrangement

  • Assisting in organising, planning, or executing a transaction for equity or debt financing relating to a body corporate or legal arrangement

  • Selling or transferring a shelf company

  • Assisting in the planning or execution of the creation or restructuring of a body corporate or legal arrangement

  • Acting, or arranging for someone to act on behalf of a person in particular positions in a body corporate or legal arrangement

  • Providing a registered office address or principal place of business address of a body corporate or legal arrangement

  • Receiving, holding, controlling or managing a person’s money or assets to help in the planning or execution of a transaction, e.g. holding funds on trust.

Information we may require

Depending on your matter, we may ask for:

  • Identification documents (e.g. driver licence or passport)

  • Confirmation of your address and date of birth

  • Information about companies or trusts involved

  • Details of the source of funds for the transaction.

Our obligations

We are legally required to:

Any personal information will be collected, used, held, and disclosed in accordance with our Privacy Policy.

What happens if you don’t provide the requested information?

If we are unable to obtain or verify this information, we may not be able to act for you or continue working on your matter.

Thank you for your cooperation

We appreciate your cooperation and will keep the process as efficient as possible.

If you have any questions at anytime, please call our office.