AML/CFT obligations for lawyers in Algeria (2026)

A client asks you to receive the proceeds of a share sale into the firm's account and pass them on to a foreign company. Another wants you to structure the purchase of a property through a newly formed company. In the vast majority of cases these engagements are legitimate, but they expose lawyers to being used as instruments. That is why the law sets AML/CFT obligations for lawyers, targeted at situations where the firm carries out financial transactions on behalf of its clients.

Since Algeria's removal from the FATF grey list on 19 June 2026, the question is no longer whether the laws exist, but whether they are applied. At the next mutual evaluation, legal professions will be assessed on how effective their due diligence is. This guide helps you define what applies to you, approach the sensitive issue of professional secrecy and put a proportionate framework in place.

1. Applicable laws and supervisory authority

Law No. 05-01 of 6 February 2005 on the prevention of and fight against money laundering and terrorist financing, amended by Law No. 23-01 of 7 February 2023 and then by Law No. 25-10 of 24 July 2025, distinguishes financial institutions from designated non-financial businesses and professions (DNFBPs). Lawyers are listed in the second category, with one essential qualification: they are covered when they carry out financial transactions on behalf of their clients. The scope is therefore functional: it is the nature of the engagement, not simply being a lawyer, that triggers the obligations.

Article 10 bis 3 of the law designates the bar councils (conseils de l'ordre des avocats) as the authorities responsible for AML/CFT supervision, monitoring and regulation of lawyers. Executive Decree No. 23-430 of 29 November 2023 (Official Journal No. 76 of 30 November 2023) sets out how these authorities operate: issuing regulations for the professions they supervise, a risk-based approach, off-site and on-site inspections, corrective measures and disciplinary sanctions, and coordination with the CTRF. Law No. 25-10 also provides for a national and sectoral risk assessment shared with obliged entities.

To place these rules within the overall framework, see our guide to AML/CFT compliance in Algeria and our analysis of Laws 05-01, 23-01 and 25-10.

2. Key obligations

Risk classification

The first step is to map the firm's engagements. Pure litigation and advice without handling funds do not carry the same profile as assisting with real estate transactions, company formations and disposals, or managing funds for clients. Combine these engagements with the client profile (individuals, companies, non-residents, politically exposed persons), the geographical origin of funds and the complexity of structures. The result is a simple grid classifying each file as low, medium or high risk.

Customer due diligence and beneficial owners

For any engagement within the scope of the law, you must identify and verify the client and, for a legal person, the natural person or persons who ultimately own or control it. The public register of beneficial owners kept by the CNRC, provided for by Article 8 of amended Law No. 05-01, is a useful source, to be cross-checked against the articles of association and the client's statements. You should also understand the purpose of the transaction and the source of funds. For politically exposed persons and high-risk situations, apply enhanced due diligence approved by a partner.

Suspicious transaction reporting and professional secrecy

When a covered lawyer suspects that a transaction, even an attempted one, involves funds of illicit origin or is linked to terrorist financing, the law provides for a report to the Financial Intelligence Processing Unit (CTRF), attached to the Ministry of Finance. The client must not be informed.

This obligation must be reconciled with professional secrecy, a cornerstone of the profession. FATF international standards accept that lawyers need not report information received in circumstances covered by professional secrecy, notably when defending a client. This protection never covers knowingly taking part in a laundering scheme. Under Algerian law, the precise interplay between secrecy, the scope of reporting and the role of the bar should be checked with your bar council. In practice: qualify the engagement, document your analysis and, when in doubt, consult your bâtonnier before acting.

Asset freezing and targeted financial sanctions

Before accepting a financial engagement, check that the client, its beneficial owners and the counterparties to the transaction do not appear on sanctions lists, notably those of the United Nations Security Council and the national list. In the event of a confirmed match, no funds may be made available and the competent authorities must be informed without delay.

Record keeping

Keep identification documents, evidence of source of funds, statements of movements through the firm's accounts and your analysis notes, so that they can be produced during a bar inspection or at the CTRF's request. Keep this due diligence evidence clearly separate from litigation documents.

Training and internal organisation

In a law firm, risk often arises from an associate who accepts a file without grasping its implications. Appoint a partner as AML/CFT lead, write a client-acceptance procedure and train the lawyers and administrative staff who handle financial flows.

3. Sector-specific typologies and red flags

• a request to use the firm's account to receive and pass on funds without any real legal service;
• funds paid in, followed by a quick cancellation of the engagement and a request for a refund to another account;
• disproportionate fees, or fees paid by a third party with no apparent link to the client;
• complex or layered corporate structures, or structures involving opaque jurisdictions, with no economic rationale;
• a client reluctant to reveal the identity of beneficial owners, or who changes contact person during the file;
• real estate transactions at prices far from market value, or financed by funds of unclear origin;
• sham disputes or settlements whose apparent purpose is to justify a transfer of funds;
• a politically exposed person acting through relatives or shell companies;
• unjustified urgency and indifference to the cost of the transaction.

4. Common mistakes

• Believing secrecy covers everything: secrecy is fundamental, but it does not put the firm out of scope when it carries out financial transactions for its clients.
• Not qualifying engagements: without identifying the files that fall within the law, no targeted due diligence is possible.
• Accepting funds before checks: once the money is in the firm's account, refusing becomes much harder.
• Relying on a referral from a colleague or a long-standing client: trust is not a due diligence measure.
• Keeping no record: before the bar or the CTRF, an unwritten analysis does not exist.

5. How Hodemia Consulting supports lawyers

Hodemia Consulting helps law firms reconcile ethical requirements with AML/CFT obligations:

• Compliance diagnostic (2 to 4 weeks): mapping of in-scope engagements, review of client-acceptance procedures and flows through the firm's accounts, prioritised action plan. See our article on the compliance diagnostic;
• AML/CFT programme set-up and KYC remediation: risk assessment, acceptance procedure, beneficial ownership forms, internal process for analysing suspicions;
• Compliance & Ethics training (1 day) for partners and associates, based on concrete cases; Leadership & Compliance seminar (2 days) for the leaders of larger firms. Explore our training courses.

To position the internal control function properly in a firm, also read our guide to the compliance function in Algeria, then contact us.

Conclusion: protecting the firm by protecting the profession

The AML/CFT obligations for lawyers are targeted: they apply when the firm carries out financial transactions for its clients, under the supervision of the bar councils. Properly understood, they do not threaten professional secrecy; on the contrary, they protect lawyers against being used as instruments and preserve the reputation of the whole profession. Qualifying each engagement, knowing clients and their beneficial owners, refusing to act as a transit account and documenting analyses: these reflexes are enough to approach upcoming inspections with confidence.

Fayçal Lounes

Founder of Hodemia Consulting

Nearly 20 years of international experience in regulatory compliance, risk and governance (EY in Luxembourg, San Francisco and London; Director, Regulatory & Compliance Services at KPMG Middle East). Certified coach, trainer and academic.