AML Compliance Guide
Log in Create Free Account

Customer due diligence for Real estate agents — 2026 AUSTRAC Guide

From 1 July 2026, a real estate business that provides a designated service must verify each customer’s identity before providing that service. For real estate agents, this matters because property is a well-known channel for laundering criminal proceeds, and AUSTRAC expects agents to know exactly who they are dealing with before a transaction moves ahead. If you skip customer due diligence, do it late, or do it poorly, you can breach the AML/CTF Act and face serious consequences, including civil penalties of up to $33.5 million per contravention and criminal penalties for intentional breaches.

Your AML/CTF obligations

  1. 1. AUSTRAC enrolment
  2. 2. Compliance officer
  3. 3. ML/TF risk assessment
  4. 4. AML/CTF program
  5. 5. Customer due diligence
  6. 6. Sanctions screening
  7. 7. Suspicious matter reporting
  8. 8. Record keeping (7 years)
  9. 9. Staff training

Customer due diligence means collecting and verifying information about the person or entity you are acting for before you provide the designated service. In practice, that means you do not just take a name on a listing authority, contract, or agency agreement at face value. You must confirm the identity of individual clients using government-issued ID, confirm companies through ASIC using their ABN or ACN, and for trusts you need trustee details, the trust deed and the beneficial owners. A beneficial owner is the natural person who owns 25% or more, or who exercises effective control.

What a real estate agent should do in practice

  • Work out whether the service you are about to provide is a designated service. Not every task done by a real estate business will trigger AML/CTF obligations.
  • Collect customer details at the start of the engagement, before marketing, negotiations, exchange support, or other designated-service work proceeds too far.
  • For an individual, verify full name, date of birth and residential address against government-issued ID.
  • For a company, confirm the legal name, type and ABN or ACN, and verify it through ASIC. Then identify the beneficial owners and any person controlling the company.
  • For a trust, obtain the trust deed, identify the trustee, and identify the beneficial owners or controllers behind the structure.
  • If the customer is a politically exposed person, linked to a high-risk country, or the transaction looks unusual, apply enhanced due diligence before proceeding.

Timing matters

CDD must be completed before you provide the designated service. In a real estate office, that means building ID checks into onboarding, not trying to fix gaps at settlement. If a client refuses to provide identity documents, wants a property bought or sold through layers of companies or trusts with no clear reason, or pushes you to move ahead before checks are done, treat that as a serious warning sign.

A common mistake in real estate is assuming the buyer is the only person you need to identify. Depending on the service and who your client is, the seller, buyer, appointing principal, company director, trustee or controlling individual may all matter. Another mistake is thinking you can rely on a driver licence sighted casually at an open home, or on details passed over by a mortgage broker, conveyancer or solicitor without following your own process. You also need to look past the entity name on the contract if the property is being bought through a family trust, shelf company or nominee arrangement.

Practical tips for agency offices

  • Add CDD to your listing and buyer onboarding checklist so no file progresses without completed ID steps.
  • Use separate workflows for individuals, companies and trusts so staff know what documents to ask for.
  • Train sales agents, property managers and admin staff to spot red flags such as unexplained source of funds, luxury purchases without inspection, overseas links, or clients who avoid meeting in person.
  • Keep clear records of what you collected, how you verified it, who checked it and when. You must retain CDD records for 7 years after the relationship ends.
  • Update your process when your service mix changes, such as moving into high-value property, developer sales or more offshore clients.

A lightweight AML platform, built exclusively for Tranche 2

Get AUSTRAC's mandates done as fast and effortless as possible.

  • Built around AUSTRAC's actual requirements
  • Single maintained compliance file
  • No compliance expertise required
  • 25 minute initial compliance setup
  • Obligations calendar & reminders
  • Instant data export
Setup: ~25 minutes Ongoing: minutes per client Price: $8 per KYC
See the product →

Frequently asked questions

Do I need to verify both the seller and the buyer?
You need to verify the customer for the designated service you are providing. In many real estate matters that will be the person or entity engaging your agency, but the exact position depends on the service and who your client is. Do not assume only one side matters—check your engagement structure and identify the actual customer before you proceed.
What if the property is being bought by a company or family trust?
You must go beyond the entity name on the contract. For a company, verify its ABN or ACN, legal name and type through ASIC, then identify the beneficial owners or controllers. For a trust, obtain trustee details, review the trust deed and identify the natural persons who own 25% or more or otherwise exercise effective control.
Can I rely on ID checks already done by the client’s lawyer or broker?
You should not assume another professional’s checks satisfy your obligation. Your business is responsible for verifying the customer before providing the designated service, so you need a process that meets your own AML/CTF requirements. If you use information from another party, make sure your records clearly show how identity was verified and that it is sufficient for your file.
What if a client refuses to provide identification or keeps delaying it?
Do not provide the designated service until CDD is completed. In real estate, refusal, delay, or attempts to rush the transaction without clear identification can be a red flag, especially where there are complex ownership structures or offshore links. If the circumstances give you reasonable grounds to suspect money laundering or terrorism financing, consider whether an SMR is required and do not tip off the client.
Will CDD be expensive or complicated for a small suburban agency?
It does not need to be complicated, but it does need to be consistent and documented. Most small agencies can build CDD into existing onboarding by using clear document checklists, ASIC searches for companies, and staff training for trusts and higher-risk matters. The cost of setting up a workable process is usually far lower than the cost of getting it wrong.

Related guides