AUSTRAC spells out how identity checks work when a home sells at auction

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Kooky

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Australia's anti-money laundering regulator has set out how its new rules apply to the one sale method where the buyer is a stranger until the last second. AUSTRAC's guidance page on real estate services, last updated on 10 July 2026, says an agent may delay initial customer due diligence on an auction buyer when completing it first would disrupt the ordinary course of business.

The page is dated nine days after the obligations themselves began. AUSTRAC has said that from 1 July 2026 real estate professionals, along with lawyers, accountants, conveyancers and dealers in precious stones and metals, must run an anti-money laundering program, carry out customer due diligence, report suspicious matters and keep records. The regulator has put the growth in the number of businesses it oversees at approximately 19,000 to nearly 100,000.

Two customers, one agent

The guidance describes two regulated real estate services: brokering a sale or purchase for someone else, and selling property directly as a business, as a developer does without an independent agent. Property management and leasing are not covered. AUSTRAC's definition of real estate for this purpose also leaves out leases of 30 years or less, easements and the interest a lender holds as mortgagee.

For a brokered sale, AUSTRAC says the buyer and the seller are both customers of the same agent. That is the point that touches auctions. A seller's agent has known the seller since the appointment was signed, and the guidance says the service to the seller starts there. The service to the buyer starts later, when it is reasonably expected that the transaction will proceed. AUSTRAC says this is typically when the buyer's offer has been accepted and the contract is signed.

The same logic runs in reverse for a buyer's agent. The guidance says the service to the buyer begins when the buyer signs the agreement to find or identify a property, and the service to the seller begins when the transaction is expected to proceed. For a developer selling its own stock, only the buyer is the customer.

At a private treaty sale those two moments can be days apart, with time to collect documents in between. At an auction they are not.

The gap between the hammer and the pen

AUSTRAC's page addresses this directly. When real estate is sold at auction, it says, a buyer may only be known after the fall of the hammer. The general rule is that initial due diligence comes before the service is provided. The exception is where doing so would disrupt the ordinary course of business, and the guidance says this will often be the case when the short time between the end of the auction and the signing of the contract is not enough to complete the checks.

The 72 is made up of about 28 sales in Brisbane, where Cotality's final rate for the week was 23.5 per cent, plus the 23 cleared auctions the firm's table shows for the Gold Coast and the 21 it shows for the Sunshine Coast. The second week will add more. Cotality's preliminary count, published on 13 July, has 128 auctions in Brisbane, 73 on the Gold Coast and 46 on the Sunshine Coast for the week ending 12 July.

How long the delay can run

The real estate page refers to conditions attached to a delay without listing them in full. They sit in a separate AUSTRAC guidance page on delayed initial customer due diligence, last updated on 22 April 2026, which uses the auction as one of its examples. It says a delay may be essential because the checks on the successful bidder cannot be completed before the auction starts.

That page sets the order of work for an agent acting for the seller. Due diligence on the seller is completed before the service begins. Due diligence on the buyer may follow, and AUSTRAC gives it an outer limit: the earlier of 28 days after the exchange of contracts, or at least three days before the scheduled settlement. An agent acting for the buyer has the same window for the checks on the seller.

The second limb matters wherever the contract sets an early settlement date. On a settlement less than a month away, the three-day mark arrives before the 28-day one. The guidance describes the general rule, and how it applies to a particular sale depends on that sale's contract and on the agency's own program.

How this sits beside Queensland's auction rules

Queensland auction law already asks for identification, for a different reason. The Office of Fair Trading's guidance on auctioning a property requires the auctioneer to register every bidder before the auction starts, to see suitable identification such as a driver licence, and to give each bidder an identifying marker such as a numbered card. The auctioneer must announce at the start that only registered bidders may bid.

That register is a consumer protection measure under state law. AUSTRAC's due diligence is a federal obligation with its own purpose and its own standard, and nothing in either agency's published material says one satisfies the other. They are separate requirements that happen to fall on the same morning.

Two other Queensland rules explain why the delay matters more here than the federal guidance alone suggests. The Queensland Government's guidance for buyers says the successful bidder must sign a contract immediately, and that there is no cooling-off period for a home bought at auction. There is no pause after the hammer in which checks could be completed before the sale becomes binding.

The Office of Fair Trading's page also covers what happens before a bid is called. A vendor bid may be accepted only up to the reserve price and must be disclosed as a vendor bid whenever it is made, and the conditions of sale, including the deposit, are disclosed to bidders. None of that changes under the federal rules. The order of events on the day looks like this.

What sits around the buyer check

The check on an auction buyer is one part of a wider set of duties that began on 1 July. AUSTRAC's summary of obligations for the newly regulated professions lists an anti-money laundering and counter-terrorism financing program made up of a risk assessment and written policies, approved by a senior manager, and a compliance officer to oversee it day to day. A sole trader may take that role personally. The program is to be independently evaluated at least every three years.

The same summary lists the reports a regulated business may have to make, among them suspicious matter reports and threshold transaction reports for physical currency of $10,000 or more, and says records are kept for at least seven years. Due diligence is also not a single event: AUSTRAC distinguishes the initial check from ongoing due diligence, with an enhanced form for higher risk and a simplified form for low risk.

One date is still ahead. AUSTRAC's summary gives businesses that began providing a regulated service on 1 July until 29 July 2026 to enrol with it, which is 28 days after the start.

What buyers and sellers will notice

For a seller, the questions about identity come at the start, when the agent is appointed. For a bidder, registration on the day works as it did in June. The new step is for the successful bidder, who can expect the selling agent to ask for identity information as part of the sale, during the formalities or in the days after them.

A sale that does not happen under the hammer follows the ordinary sequence. Queensland's guidance for sellers allows a vendor whose reserve is not reached to negotiate with a bidder afterwards, and with Cotality counting 77 Brisbane auctions passed in during the week ending 5 July, that is a common path this winter. A negotiated sale leaves time between the offer and the contract that an auction does not.

Agents, auctioneers and their staff are carrying a new layer of paperwork into a sale method that is already tightly regulated in Queensland. AUSTRAC's guidance recognises that an auction cannot be paused for it.

Kooky, from Shaka

Kooky edits Queensland Estate and builds Shaka, the payment router he made for Queensland property professionals. One payment comes in, and every agent, agency and party in the deal receives their signed share on closing date.

About Kooky and Shaka →