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Lawyers can’t be covert informers on their clients, Law Council warns
The Law Council of Australia has pushed back on “rhetoric” suggesting the country needs an AML/CTF regime that requires Australian lawyers to report on their clients.
Jerome Doraisamy
Earlier this week, Law Council president-elect Juliana Warner appeared before the legal and constitutional affairs legislation committee as part of its inquiry into the Anti-Money Laundering and Counter-Terrorism Financing Amendment Bill 2024 [Provisions] to stress the concerns the organisation has about aspects of the bill.
Speaking in the wake of that appearance, LCA president Greg McIntyre SC (pictured) said that while the organisation supports efforts to prevent financial crime, deprive terrorist groups of income sources, and ensure Australia meets the standards it has committed to as a member of the Financial Action Task Force (FATF), it does “not agree with rhetoric that Australia needs to implement an AML/CTF regime which requires Australian lawyers to report on their clients, or face being ‘grey-listed’ by the FATF”.
The comments follow the “critical” concerns flagged by multiple bar associations, which have argued that barristers must be exempt from the new AML/CTF regime.
The Law Council has also previously argued that the proposed changes may harm small firms, while a Liberal MP has suggested that the bill would burden SME practitioners with extra costs.
McIntyre said: “We believe Australia not only can, and should, develop its own localised solution that mitigates AML/CTF risks, but that this is not contrary to FATF requirements. The FATF assessment explicitly recognises there will be regional differences in domestic law and legal systems applying to lawyers.”
Therefore, he said, LCA continues to recommend amendments to the bill, which it believes will achieve the outcomes desired, “without causing significant harm to the fundamental rights of ordinary Australians with legal problems or concerns to consult their lawyers in privacy – rights which are essential to the administration of justice in this country”.
In particular, he pointed out, the organisation remains concerned about the potential for the bill to undermine the lawyer/client relationship and the position of lawyers as officers of the court, “which is a core part of Australia’s justice system and the rule of law”.
It is critical, McIntyre argued, “that a person seeking legal advice is able to have a frank and honest discussion with their lawyer, which can include matters that may implicate the person in a crime, without fear that the lawyer will, or is required to, inform a prosecuting authority”.
“This, in turn, advances the rule of law as it assists clients in conducting their personal and business affairs within the law,” he said.
“The bill in its current form requires a lawyer to secretly report ‘suspicious matters’. The threshold for suspicious matter reporting is very low and broad – much wider than money laundering.”
In the “comparable nation” of Canada, McIntyre noted, lawyers are not required to make suspicious matter reports, and it has not been grey-listed.
“We believe the Australian model needs to strike a better balance between law enforcement and access to justice. This would mandate action to be taken by the legal profession to avoid unwittingly facilitating money laundering, without undermining the important role that lawyers play in the administration of justice,” he said.
“In addition, we continue to raise the potential for the proposed regime to impose substantial regulatory burden and costs on lawyers, which will make it even more difficult for Australians to access legal assistance when they need it most.”
Jerome Doraisamy
Jerome Doraisamy is the editor of Lawyers Weekly. A former lawyer, he has worked at Momentum Media as a journalist on Lawyers Weekly since February 2018, and has served as editor since March 2022. He is also the host of all five shows under The Lawyers Weekly Podcast Network, and has overseen the brand's audio medium growth from 4,000 downloads per month to over 60,000 downloads per month, making The Lawyers Weekly Show the most popular industry-specific podcast in Australia. Jerome is also the author of The Wellness Doctrines book series, an admitted solicitor in NSW, and a board director of Minds Count.
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