KYB Checks for Australian Solicitors: AML Guide
The anti-money laundering (AML) reforms that came into effect on 1 July 2026 changed the compliance landscape for Australian legal practices. For many solicitors, the focus has been on verifying individual clients. But verifying business clients is just as critical, and arguably more complex. That is where Know Your Business (KYB) comes in.
What Is a KYB Check?
A KYB check is the process of verifying the identity and legitimacy of a business entity before, or as part of, acting for it. Think of it as the business equivalent of a Know Your Customer (KYC) check.
Under the expanded Anti-Money Laundering and Counter-Terrorism Financing (AML/CTF) obligations that now apply to solicitors, legal practitioners must identify and verify not just the person across the table, but also the entity they represent. That means:
- confirming the business is who it says it is,
- understanding its structure, and
- identifying who ultimately controls or benefits from it, the so-called beneficial owners.
Why KYB Matters for Legal Practices
When you act for a company or trust in a designated service, such as buying or selling property, managing client funds, or forming a company, you are an AUSTRAC reporting entity under the AML/CTF Act. That carries real AML obligations for solicitors.
A solid KYB process gives you documented, verifiable confidence that:
- the entity you are acting for is legitimate, and
- you have a clear audit trail that demonstrates your due diligence if questions ever arise.
What Does a KYB Check Cover?
A thorough KYB check typically includes:
- Entity verification, confirming registration with ASIC and that details such as name, ACN, and address are current.
- Beneficial ownership verification, identifying individuals who ultimately own or control the entity, generally those with 25% or more ownership.
- Sanctions and Politically Exposed Person (PEP) screening, checking whether the entity or its controllers appear on sanctions lists or are politically exposed persons.
- Risk rating, assessing overall client risk based on entity type, jurisdiction, and matter type.
The goal is not to be obstructive. It is to apply appropriate due diligence so you can act with confidence.
KYB Inside Your Practice Management Software
Running KYB checks manually, such as pulling ASIC records, cross-referencing sanctions lists, and documenting everything separately, is time-consuming and prone to errors. That is where SILQ legal practice management software makes a real difference in supporting AML compliance for law firms.
SILQ's AML/CTF integration (available to Solicitor Expand and Expert subscribers) includes a dedicated KYB option built directly into the company contact creation workflow. Business verification is captured at intake, not as an afterthought.
SILQ also supports matter-class tracking, helping you determine whether a matter is a designated service and triggering your compliance obligations within the same platform you already use. There is no need to jump into other tech solutions. You can document your KYB check from start to finish inside SILQ.
When something raises a red flag, SILQ's 'Submit SMR' button lets you file a Suspicious Matter Report with AUSTRAC.
A Practical Mindset Shift
KYB is now part of what it means to practise law responsibly in Australia. Knowing who you are acting for is a legal obligation. If your intake process does not include a structured KYB check for business clients, now is the time to add one.
SILQ makes it practical to embed compliance into your everyday workflow, so it does not slow you down. It simply becomes part of how you work.
In short, Australian solicitors who provide designated services must, where relevant, conduct KYB checks on business clients as part of their AML/CTF obligations. A structured KYB process, like the one SILQ provides, covers entity verification, beneficial ownership verification, and sanctions screening, protects your practice, and demonstrates due diligence to regulators.
To see SILQ's AML feature in action, book a free, personalised demonstration today or try SILQ free for 14 days.
Frequently Asked Questions
What does KYB stand for? KYB stands for Know Your Business. It refers to the process of verifying a business client's identity and ownership structure.
What is the difference between KYB and KYC? KYC (Know Your Customer) verifies an individual client's identity. KYB (Know Your Business) applies the same principle to business entities, verifying the company's registration, structure, and ultimate ownership or control. Both are required under Australia's AML/CTF framework, depending on who you are acting for.
Do Australian solicitors need to register with AUSTRAC? If you provide designated services, then yes. All legal practices that provide designated services have been able to enrol with AUSTRAC since 31 March 2026.
What is a designated service for solicitors? Designated services include matters like buying or selling real estate, managing client funds, forming companies, and certain trust and conveyancing work.
Are Australian solicitors required to do KYB checks? Yes, but only if you offer designated services. Since 1 July 2026, solicitors providing designated services to business clients are required to conduct KYB checks as part of their AML/CTF obligations.
What is a beneficial owner? A beneficial owner is an individual who ultimately owns or controls a business, typically someone with 25% or more ownership or voting rights.
Where can I find more information about SILQ's AML feature? SILQ has recently launched our AML Resource Hub, which covers news, insights, expert webinars, FAQs, and more on the AML/CTF regulation, as well as how to use SILQ's AML functionality, supporting solicitor clients with their due diligence administration.
