Conveyancing program starter kit: examples of dealing with clients
These examples show how the conveyancer program starter kit can work in practice to deal with your clients based on their risk.
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Low-risk client example
A conveyancer acts for a potential buyer of property worth $1 million.
After the buyer is successful at auction, the conveyancer completes initial CDD on them 15 days after exchange of contracts, before settlement or as soon as practicable (whatever is earlier) by using the:
- initial CDD policy and ongoing CDD policy in the Policy document
- onboarding form – individuals and sole traders
- initial customer due diligence form – individual.
The conveyancer asks the buyer whether they’re buying the property for themselves. The buyer confirms. The conveyancer has them fill out the onboarding form – Individuals and sole traders.
The buyer completes the form confirming:
- their name, date of birth, residential address, country of residence and occupation
- they are buying the property as residential property to live in
- they are not purchasing the property using a legal arrangement (such as a trust) or body corporate
- they will purchase the property using both a loan from an Australian bank and funds held in their bank account
- they are not a politically exposed person
- they will provide their driver's licence to confirm their identity.
Assess the client’s risk
The conveyancer uses the initial customer due diligence form – individual to assess the risk of the client. They have identified no medium to high risk factors, so they rate the client as low risk.
The conveyancer then uses the initial customer due diligence form – individual to:
- verify the name and date of birth of the buyer, and that they are who they claim to be. They do this by checking the driver's licence details against their appearance and the details in the on-boarding form
- record that they have no concerns with the validity of the driver’s licence and that there are no discrepancies.
To verify the buyer isn’t a politically exposed person or subject to sanctions the conveyancer follows the:
- Process: Sanctions check
- Process: Politically exposed persons check.
The conveyancer records these findings in the initial customer due diligence form – individual.
The conveyancer completes the final onboarding checks, validating they’ve completed all steps required for onboarding.
Verify the buyer isn’t high risk
The conveyancer verifies that the buyer isn’t high risk, there are no potentially suspicious matters and no new ML/TF risk factors that aren’t in their risk assessment.
The matter can be completed without being escalated to the AML/CTF compliance officer under the escalation and enhanced CDD policy in the Policy document. They assign a final ML/TF risk rating of low.
The conveyancer has limited interaction with the buyer between exchange of contracts and settlement. During their interactions, they monitor the buyer for any indicators of criminal activity or changes to ML/TF risk as outlined in their risk assessment, but none arise.
Settlement is completed within 1 month of exchange of contracts. At this point, the business relationship has concluded and no further ongoing CDD and monitoring is required.
Medium-risk client example
An individual places a successful bid on a property at an auction, valued at $1.3 million. Following the auction, the conveyancer conducts initial CDD on the buyer using the:
- initial CDD policy and ongoing CDD policy in the Policy document
- onboarding form – individuals and sole traders
- initial customer due diligence form - individual.
The conveyancer then asks the individual if they’re buying the property for themselves. The individual confirms that they are acting as a representative of a married couple who are the buyers and will be purchasing the property jointly.
The conveyancer has the buyers’ representative complete the onboarding form - Individuals and sole traders confirming the:
- the name, date of birth, residential address, country of residence and occupation of the representative and the buyers
- the service the buyers are seeking, being the purchase of a residential property
- the buyers will be using a mortgage to purchase the property alongside the deposit transferred to the agent after the auction
- the buyers will not be purchasing the property using a legal arrangement or body corporate
- both of the buyers are a domestic politically exposed person (PEP), as they’re the parents of a State Member of Parliament
- the representative has reliable documentation showing their authority to act on behalf of the buyers
- the representative is a reporting entity (a buyer’s agent) that isn’t enrolled with AUSTRAC
- the representative is not a PEP
- the buyers and representative will provide a copy of their Australian driver’s licences to verify their identities.
Assess the client’s risk
The conveyancer uses the initial customer due diligence form – individual to assess the risk of the buyers. As they’ve identified the following medium risk factors, they determine that the ML/TF risk rating is medium the buyers are:
- domestic PEPs (medium risk factor)
- using a third-party agent who isn’t enrolled with AUSTRAC (medium risk factor).
The conveyancer determines that they can apply delayed CDD because:
- they are completing CDD on the counterparty (buyer) at an auction
- there is low additional ML/TF risk associated with delaying CDD as this will be completed before settlement date
- there are adequate controls to manage this additional risk, including the ability to stop conveyancing services if the buyers fall outside their risk appetite.
Sanctions screening and CDD
The conveyancer then completes sanction screening without delay using Process: Sanctions check. The conveyancer documents all required details and confirms that the representative and clients aren’t subject to sanctions.
After exchange of contracts, the conveyancer uses initial customer due diligence form – individual to:
- verify the identity of the representative and the 2 buyers
- verify the representative’s authority to act on behalf of the buyers
- complete a PEP check by following the Process: Politically exposed persons check, confirming that the representative is not a PEP and that the clients are family members of a domestic PEP.
The conveyancer is then able to complete initial CDD by confirming that there are:
- no triggers identified as set out in the escalation and enhanced CDD policy in the Policy document
- no circumstances that have changed the initial risk rating.
Monitor client behaviour
In line with their ongoing CDD policy in the Policy document, the conveyancer documents all interactions with their clients. This is to monitor client behaviour and transactions through the remainder of the business relationship for any:
- indicators of criminal activity
- changes to ML/TF risk.
Settlement is completed within 2 months of exchange of contracts, at which point the business relationship has concluded. No further ongoing CDD is required.
High-risk client example
A conveyancer is approached by an individual who is seeking to buy a luxury property valued between $5 million and $5.5 million.
The conveyancer starts initial CDD after exchange of contracts by using the:
- initial CDD policy and ongoing CDD policy in the Policy document
- onboarding form – individuals and sole trader
- initial customer due diligence form – individual.
The conveyancer asks the individual whether they’re buying the property for themselves or another person. The individual confirms they’re purchasing the property for themselves. The conveyancer has the client fill out the onboarding form - individuals and sole traders.
The buyer fills this out with information confirming:
- their name, date of birth, residential address, country of residence and occupation
- the service they are seeking is to purchase a residential property
- the buyer will be purchasing the property through an unfinanced transaction (without a mortgage or other form of loan)
- they won’t be purchasing the property using a legal arrangement, such as a company or trust
- they’re a senior government official in a foreign country, meaning they’re a foreign politically exposed person (PEP)
- they’ll provide a foreign passport from a low risk country to prove their identity.
Assess the client’s risk
The conveyancer uses the initial customer due diligence form – individual to assess the risk of the client. As they’ve identified the following high risk and medium risk factors, they determine that the risk rating is high as the client is:
- a foreign PEP (high risk factor)
- purchasing a property valued over A$1.5 million without a mortgage (medium risk factor).
As the client is high risk, the conveyancer must escalate to the AML/CTF compliance officer under the escalation and enhanced CDD policy in the Policy document.
The conveyancer completes a copy of the Guided form: escalation and provides this to the AML/CTF compliance officer.
Role of the AML/CTF compliance officer
The AML/CTF compliance officer receives the escalation and completes enhanced customer due diligence using the Guided form: Enhanced CDD.
The AML/CTF compliance officer uses this form and the initial customer due diligence form – individual to verify the identity of the client. They:
- document all required information from the identification documents of the client
- confirm the client’s identity by comparing the photo in the identification document against the individual
- have no concerns about the validity of the documents or information provided at onboarding by the client
- follow the nature and purpose of the business relationship verification process to confirm that the information provided by the client about why they were requesting the services was truthful.
After this they record that the client is a foreign PEP and is a high-risk client and collect and record additional information. In engaging with the client, they outline that further information is required to meet their AML/CTF obligations and fulfill the conditions of their amended retainer. This requires the client to provide additional information where required.
Other client checks
The AML/CTF compliance officer follows the source of funds and source of wealth check process. When completing this check, the client explains that the source of funds is from their salary, with their sources of wealth including their salary and share holdings. This information is verified using pay slips and a summary of shares from the share registry.
When assessing for the information provided by the client about their sources of wealth and funds, the AML/CTF compliance officer identifies that the value of the real estate they’re seeking to buy appears grossly excessive to their known sources of wealth.
The AML/CTF compliance officer completes open-source background checks using the adverse media check process. These searches show that the client has been investigated internationally for fraud and corruption.
Grounds for suspicion
The AML/CTF compliance officer forms reasonable grounds for a suspicion that the matter may be relevant to or assist with an investigation into a criminal offence. This includes dealing with unexplained wealth or the proceeds of corruption. The AML/CTF compliance officer submits a suspicious matter report to AUSTRAC using their analysis and the information provided by the client.
Client rated as high risk
Because the client has been rated as high risk, the AML/CTF compliance officer seeks written approval from the senior manager before providing the designated service to the client. The senior manager provides written approval to continue engaging with the client.
Throughout the remainder of the business relationship, the conveyancer uses the ongoing CDD policy and monitors the client for any indicators of criminal activity or changes to ML/TF risk as outlined in the Risk assessment, monitoring their behaviours more closely than they would if the client risk was rated as low or medium.
Ongoing customer monitoring
The client ends up engaged in a protracted legal dispute with the seller, which lasts over a year and delays the completion of the settlement process. A year after exchange of contracts, the conveyancing practice completes a periodic review of the information the buyer has provided using the periodic review and update form and finds no discrepancies.
The purchase is finalised, and settlement is completed 14 months after exchange of contracts. The business relationship has concluded at this point, meaning that no further ongoing CDD is required.
Related pages
The program starter kits are intended to be used as a complete package and have been designed for use by those reporting entities who satisfy certain suitability criteria. That suitability criteria is set out in the ‘Getting Started’ web page under the heading “Who the starter kit is for” in each program starter kit. In particular, those Tranche 2 entities who, from 1 July 2026, are for the first time subject to anti-money laundering and counter-terrorism financing legislation (AML/CTF).
The program starter kits have been designed for the purpose of providing practical guidance to those reporting entities to assist them to build their own AML/CTF programs. The program starter kits represent AUSTRAC’s interpretation and application of the law to the eligible reporting entities only and are not intended to represent an interpretation and application of the law in all circumstances. The program starter kits are not a substitute for legal advice about any reporting entity’s AML/CTF compliance obligations. Australian courts are ultimately responsible for interpreting the AML/CTF legislation and determining if any provision of these laws are contravened.
This guidance sets out how we interpret the Act, along with associated Rules and regulations. Australian courts are ultimately responsible for interpreting these laws and determining if any provisions of these laws are contravened.
The examples and scenarios in this guidance are meant to help explain our interpretation of these laws. They’re not exhaustive or meant to cover every possible scenario.
This guidance provides general information and isn't a substitute for legal advice. This guidance avoids legal language wherever possible and it might include generalisations about the application of the law. Some provisions of the law referred to have exceptions or important qualifications. In most cases your particular circumstances must be taken into account when determining how the law applies to you.