From money laundering to illicit finance? The evolving ‘AML’ regulatory regimes for legal professionals in the UK and Australia

Since the introduction of the global anti-money laundering (AML) regime, the focus of (inter)national concern has broadened, from the laundering of the proceeds of drug trafficking and other organised crimes to a range of crime and security issues captured by the term ‘illicit finance’. These include money laundering, terrorism financing, proliferation financing, tax evasion, corruption, kleptocracy and sanctions evasion. This article considers how this shift from ‘money laundering’ to ‘illicit finance’ has changed the nature of the ‘AML’ regime for legal professionals in the UK, and what lessons this holds for Australia amidst ongoing regulatory reform. It argues that legislation enacted in the UK since 2017, encompassing key themes of transparency and financial sanctions, has expanded the ‘gatekeeper’ role of legal professionals, creating further opportunities to prevent or enable illicit finance and further regulatory obligations (and potential exposure to criminal sanctions). A reformed Australian regime should aim to address all relevant crime and security threats and the various ways that individual actors, systemic factors and regulatory gaps within professional service provision can enable illicit finance. However, it must also recognise and manage the implications of ever-expanding regulatory obligations, and the compliance challenges these obligations can create.