One of the biggest worries law firms often have about AML is not the law itself. It is the client reaction. Will clients get annoyed? Will onboarding slow down? Will they think the firm does not trust them? Will they go somewhere else if the process feels too hard?

The AMLCO role matters because AML is not a one-off implementation task. It is ongoing governance. The person in the role needs enough authority to influence behaviour, enough practical understanding to make the framework workable, and enough support to avoid becoming the firm’s compliance dumping ground.

For many law firms preparing for Tranche 2, the instinct has been to ask: ‘What documents do we need?’ It is a fair question. Firms do need an AML/CTF program. They do need policies, procedures, controls, training records and evidence of decisions. But the better question is: ‘What do we need people to do differently in practice?’

AML compliance isn’t about filling in forms and filing them away. It’s about understanding who your client is, what risk they present, and why your firm decided to proceed. Templates can create structure, but they can also give a false sense of security if they replace proper judgement. As Tranche 2 approaches, law firms need AML programmes that work in practice with clear thinking, consistent decision-making and evidence that shows not just what was done, but why.

AML compliance isn’t about filling in forms and filing them away. It’s about understanding who your client is, what risk they present, and why your firm decided to proceed. Templates can create structure, but they can also give a false sense of security if they replace proper judgement. As Tranche 2 approaches, law firms need AML programmes that work in practice with clear thinking, consistent decision-making and evidence that shows not just what was done, but why.

AML compliance isn’t about filling in forms and filing them away. It’s about understanding who your client is, what risk they present, and why your firm decided to proceed. Templates can create structure, but they can also give a false sense of security if they replace proper judgement. As Tranche 2 approaches, law firms need AML programmes that work in practice with clear thinking, consistent decision-making and evidence that shows not just what was done, but why.

Source of Wealth isn’t about collecting documents for the sake of it. It’s about understanding whether the story you’ve been given actually makes sense. As AML changes approach in Australia, firms need to move beyond checklists and apply consistent, proportionate judgement to the bigger picture behind the transaction.

With Tranche 2 going live on 1 July, this is where many firms will feel the pressure. It’s not the collection of documents that matters — it’s whether you’ve actually understood them. Because when decisions are questioned later, ‘we had it on file’ won’t be enough. The real test is simple: what did you understand, and why did you proceed?

AUSTRAC enrolment for Tranche 2 is now open, and law firms must act. This step-by-step guide explains who needs to enrol, key deadlines and how to complete your enrolment correctly before 1 July 2026.