Settlement Services Trigger
AML obligations apply when you provide settlement services that directly advance real property transfers - the key designated service for conveyancers under Tranche 2.
Conveyancing Professionals
Conveyancer AML Obligations
Complete guide to AML/CTF obligations for conveyancers under AUSTRAC Tranche 2 reforms. Learn about property settlement triggers, customer due diligence requirements, and compliance timelines starting 1 July 2026.
Key Information
AUSTRAC Requirements for Conveyancers Under Tranche 2
From 1 July 2026, licensed conveyancers become reporting entities under Australia's expanded AML/CTF regime when providing settlement services that directly advance the transfer of real property. This guide explains your obligations under AUSTRAC's Tranche 2 reforms.
Your Designated Service
As a conveyancer, you trigger AML/CTF obligations when you provide settlement services - activities that directly advance the transfer of interests in real property. This includes:
- Managing the settlement process and coordinating with banks
- Handling settlement funds and directing their distribution
- Facilitating the transfer of legal title through land registries
- Acting as settlement agent between parties
Why Conveyancers Are Regulated
Real property is one of the most common vehicles for money laundering in Australia. Criminal proceeds are frequently channeled through property purchases to create the appearance of legitimate wealth. Conveyancers are positioned at the critical settlement stage where these illicit funds enter the property system. AUSTRAC recognizes that effective ML/TF detection requires professionals at every stage of property transactions to be vigilant.
Key Compliance Dates
- 31 March 2026: AUSTRAC enrolment opens for conveyancers
- 1 July 2026: AML/CTF obligations commence
- 29 July 2026: Deadline to complete AUSTRAC enrolment
Your Core Obligations
- Enrol with AUSTRAC as a reporting entity
- Develop an AML/CTF program tailored to your settlement practice
- Conduct Customer Due Diligence (CDD) on clients before providing settlement services
- Verify source of funds for property purchases
- Identify beneficial owners behind corporate and trust structures
- Report suspicious matters to AUSTRAC
- Keep records for 7 years
Important: No LPP Protection
Unlike solicitors and legal practitioners, licensed conveyancers do not have access to Legal Professional Privilege (LPP) protections. This means you cannot refuse to produce documents or report suspicious matters based on privilege claims. All suspicious matters must be reported to AUSTRAC without exception.
Key Requirements
CDD at Service Commencement
Verify customer identity when they engage your services for property settlement. This includes buyers, sellers, and any beneficial owners behind corporate entities.
Source of Funds Verification
Understand where settlement funds originate. Document the source of deposit payments, loan arrangements, and any cash contributions to the purchase.
Beneficial Ownership
Identify the true beneficial owners behind companies, trusts, and other entities involved in property transactions - crucial for detecting nominee arrangements.
Suspicious Matter Reporting
Report concerns to AUSTRAC when transactions show ML/TF indicators - unusual funding sources, rapid property flipping, or mismatches between purchase price and property value.
7-Year Record Keeping
Maintain comprehensive records of customer identification, verification documents, transaction details, and compliance activities for at least 7 years.
Frequently asked questions
What services trigger AML obligations for conveyancers?
Your AML/CTF obligations are triggered when you provide settlement services that directly advance the transfer of real property. This includes managing settlement funds, coordinating with banks and other parties, and facilitating the transfer of legal title. General conveyancing advice without settlement involvement may not trigger obligations.
How do conveyancers differ from lawyers under Tranche 2?
Licensed conveyancers have the same AML/CTF obligations as lawyers when providing property settlement services. However, conveyancers don't have access to Legal Professional Privilege (LPP) protections available to legal practitioners. You must report all suspicious matters to AUSTRAC and cannot rely on LPP to withhold documents.
When must conveyancers verify customer identity?
Complete customer due diligence when the client engages your settlement services, and before you begin facilitating the property transfer. If acting for both parties (where permitted), verify both. For companies and trusts, identify the beneficial owners - not just the entity itself.
What property transaction red flags should conveyancers watch for?
Key indicators include: cash purchases or large cash deposits without clear source, rapid property flipping (buying and selling within short periods), purchase prices significantly above or below market value, nominee buyers or sellers, complex ownership structures without clear commercial purpose, and reluctance to provide identity documents.
Streamline Your Settlement Compliance
ARCaml provides automated customer verification, source of funds documentation, and AUSTRAC reporting tools designed for conveyancing practices. Be ready before obligations commence 1 July 2026.