New Identity Checks: Here’s What You Need to Know
Posted on July 7th, 2026
A change is here that will impact the way we as lawyers will deal with our clients.
On 1 July 2026 law firms became an AML/CTF Tranche 2 entity. What does this mean, apart from us reciting an alphabet soup at you?
AML/CTF stands for anti-money laundering and counter-terrorism financing. From 1 July 2026 lawyers are now required to ask their clients a few questions about sources of finances and make sure they have verified their client’s identity.
If you have bought or sold a house in the last five years, you will already be familiar with the verification of identity (VOI) requirements. VOI requires a lawyer to site government issued photo identification such as a drivers license, passport, or other government issued photo identification. If you are buying or selling a house lawyers are required to sight two forms of government issued photo identification. If you don’t have two forms of government issued photo identification, they are required to sight some other forms of government issued identification documents such as birth certificate, medicare cards or change of name documents. This is a mandatory requirement to allow property to be bought and sold.
If you have sought any legal services in the past 10 years you have probably been asked to provide at least a drivers license before engaging your lawyer. Whilst this has not been a mandatory requirement, it has been best practice for many years.
With AML/CTF reforms it will now be mandatory for a lawyer to verify the identity of their client when delivering a designated service. For us at Macdonald & Michel Lawyers, a lot of the legal work we do for you is a designated service, so we will be asking you to verify your identity.
The second part of the reform is to make sure you are not involved in criminal activity, or terrorism. This will mean you may be asked a couple of questions about your source of finances and asked to provide documentation to confirm where your funds have come from.
We are not being nosy, but we are required to obtain this information if you as a client meet certain trigger events.
For most people, we do not anticipate that this will make a big change in how you deal with us. For most people, you will just need to provide identity documents and answer a few questions. For the few people that may have to provide a bit more information, we will aim to make this as easy as possible.
We will also ensure that all this information remains confidential.
If you want to know more about this change you can read all about it at the Austrac website. If you have any questions about the process when dealing with us, please don’t hesitate to ask.
Stacey O’Gorman – Solicitor.