Australian Sanctions Guidance: A plain-English summary for Accountants, Lawyers, and Real Estate Professionals

If you work in accounting, law, or real estate, you've probably spent the last year getting your head around the new Anti-Money Laundering (AML) regulations. There's a lot to absorb before businesses need to start complying on the 1st of July 2026. But one obligation that often gets overlooked is sanctions screening.

Most accounting, legal, and real estate professionals understand that sanctions lists exist. Far fewer have a clear process for when to screen, what to do with a match, or how sanctions obligations connect to the AML program they're currently building. Knowing you need to screen is one thing. Doing it well in practice is another.

The Australian Sanctions Office (ASO) has recently released three new sector-specific sanctions guidance notes, one each for accountants, legal professionals, and real estate agents, to spell out exactly what sanctions obligations look like in practice for each sector.

This post walks through what the guidance says, sector by sector, and what you should do about it.

Sanctions ≠ AML

Sanctions and AML/CTF are not the same thing. They intersect, but they are governed differently and enforced separately.

Different regulator, different legislation

Australia's sanctions framework is administered by the ASO, which sits within the Department of Foreign Affairs and Trade (DFAT). AUSTRAC administers AML/CTF. These are separate agencies operating under separate legislation.

Different purpose

• AML/CTF is about detecting and disrupting money laundering and terrorism financing. 
• Sanctions are targeted foreign policy measures, restrictions imposed on specific individuals, entities and countries in response to things like armed conflict, human rights abuses etc.

These distinctions matter because sanctions obligations have strict liability.

Australia maintains a Consolidated List of designated persons and entities. These are individuals, entities and vessels subject to sanctions. If someone on that list is involved in a transaction you're facilitating:

• you must not proceed with the transaction
• you may need to freeze assets you hold or control that belong to a designated person
• you must report the transaction to the ASO and the Australian Federal Police

These are strict liability offences for organisations. Penalties can reach $3.3 million for an entity, or three times the value of the transaction involved, whichever is greater.

The ASO's approach is cooperative. It wants to help regulated entities comply, not catch them out. But that goodwill doesn't reduce the legal obligations.

New sanctions guidance - sector by sector

The guidance is consistent in principle, but the exposure points differ depending on what you actually do. Click below to jump to your industry. 

• Accounting
• Legal sector
• Real estate

Accounting

What it's about

For accountants, sanctions risk shows up wherever money or financial control is involved.

What it means in practice

• Screen before you engage.
  Before providing a service, verify your client's identity and check them and any beneficial owners against the Consolidated List. This is how you exercise the "reasonable precautions and due diligence" defence that the guidance allows.
• Understand what "dealing" means.
  Managing funds, signing off on transactions, or providing advice that facilitates a sanctioned transaction can all equal a prohibited dealing. The obligation applies to what you do, not just who you act for.
• Document your process.
  How you conduct a screening check, decide why you will accept or decline an engagement, and any escalation procedures for red flags you identify should all be logged.
• Report if something doesn't look right.
  If you suspect a sanctions breach by a client or anyone else, report it to the ASO. The guidance is explicit that self-reporting and cooperation are viewed favourably when enforcement decisions are made.

Example

An accounting firm is engaged to manage the accounts of a new corporate client. The shareholder >25% of the company returns a potential match on the Consolidated List. The firm pauses the engagement, investigates the match, documents its findings, and if confirmed as a positive hit, does not proceed and reports the matter to the ASO. All records and decisions are documented. 

Legal sector

What it's about

Legal professionals sit at a critical junction. You establish structures, move assets, and act on behalf of clients. This creates direct exposure to sanctions risk, particularly in transactions and corporate work.

One notable element in the guidance is a class-based permit, allowing legal professionals to provide advice, representation, and supporting services to designated persons in certain defined circumstances. Without a permit, even providing legal advice to a sanctioned individual could be a prohibited service.

What it means in practice

• Screen before accepting instructions.
  A law firm acting on a property transaction, a corporate restructure, or an estate administration needs to confirm that the clients involved are not designated persons, including beneficial owners of corporate clients.
• Build screening into matter intake.
  The guidance encourages firms to treat sanctions assessment the same way they treat conflict checks, something that happens at the start, not as an afterthought.
• Watch how you receive funds.
  Accepting fees from a sanctioned source can itself constitute a prohibited dealing. The source of the money matters, not just the identity of the person instructing you.
• Know where privilege ends.
  Legal professional privilege does not provide a blanket exemption from sanctions obligations. Firms should take legal advice on the interaction between privilege and reporting duties. The default position is that suspected contraventions should be escalated.

Example

A law firm is instructed to act on a commercial acquisition. During intake, the firm screens the purchasing entity and identifies that one of its directors is a close associate of a person on the Consolidated List. The firm escalates to its compliance officer, reviews whether the class-based permit applies, seeks external advice before proceeding, and documents the full decision trail. 

Real estate

What it's about

Property is a well-known vehicle for storing and moving wealth. That makes real estate a natural exposure point for sanctions risk.

Real estate agents, buyers' agents, and related professionals can become caught up in sanctions risk without realising it. A purchaser who is a designated person. A vendor with links to a sanctioned entity. A transaction structured to move sanctioned assets into Australian property. These aren't hypothetical scenarios; they reflect the patterns regulators have seen in Australia already.

What it means for your agency

• Screen buyers, sellers, and beneficial owners.
  Both parties within a property transaction, including the buyer, the seller and their ultimate beneficial owners, need to be checked against the Consolidated List.
• Know the red flags.
  The guidance points to indicators like unusual payment structures, reluctance to provide identification, or transactions with no clear commercial rationale. These warrant closer scrutiny before you proceed.
• Stop if you get a match.
  If screening returns any hits against the Consolidated List, you cannot proceed on the basis that it might be a false positive. Pause the transaction, investigate whether it is a true or false positive, seek advice, and document your decision-making.
• Report as required.
  A confirmed or suspected sanctions breach should be reported. An agent who identifies a potential issue and takes no action faces the same penalties as one who actively proceeds with a prohibited transaction.

Example

A real estate agency is handling the sale of a residential property. The prospective buyer is purchasing through a company. Screening the buyer’s company's shareholders returns a match against the Consolidated List. The agent pauses the transaction, does not accept or progress the offer, notifies their compliance officer, and reports the matter to the ASO. 

How sanctions screening fits into your AML/CTF program

Sanctions screening isn’t a separate program. The AML/CTF Rules 2025 make this explicit. Part 5 of the Rules requires that your AML/CTF program include controls to ensure you identify any transactions with listed persons or their assets.

The key callout is to ensure your CDD workflow includes an explicit sanctions screening step and that you have a documented process for what happens when a match comes back. 

Natural points for sanctions checking include:

• before client engagement
• during onboarding (CDD)
• when ownership or control changes
• when the risk profile of a transaction changes

Note that the same data you collect for Customer Due Diligence (CDD) - identity verification, understanding beneficial ownership, and assessing the purpose and nature of a business relationship - is what you use to screen against the Consolidated List.

What to do next

Operationalising sanctions checks

• Connect your sanctions process to your AML/CTF program build.
  If you're writing policies and procedures ahead of 1 July, make sure they explicitly address targeted financial sanctions. The AML/CTF Rules already require it. The ASO guidance reinforces it.
• Decide exactly where sanctions screening happens in your client intake process.
  Who runs the check? When does it happen? Before the engagement letter, at the matter opening, or at contract exchange? What's the escalation path if a positive hit comes back? These questions need documented answers within your compliance program.
• Start screening against the Consolidated List.
  The list is publicly available and updated regularly. Manual screening is possible for low-volume businesses; automated screening via screening tools helps to reduce the risk of human error and missed matches significantly, particularly for high-volume businesses.
• Train the staff who hold client relationships.
  The obligation rests with the business, not just the compliance officer. Client-facing staff need to know what they're looking for, how to determine a true or false positive hit and who to escalate to when a positive hit is identified.
• Document everything.
  Screening checks, decisions, escalations, and outcomes. The ASO guidance consistently emphasises that the ability to demonstrate reasonable precautions and due diligence is central to how enforcement decisions are made. If your process exists but isn't documented, it doesn't exist.

Quick decision / process chart

• Screen client and beneficial owners against the Consolidated List
• If no match >> proceed
• If a potential match >> pause and investigate
• If confirmed match >> do not proceed and report
• Document every step, decision and outcome
• Alongside that, train staff to recognise the situations where screening risk is higher.

Frequently asked questions