Real estate
What raises risk
Each risk factor below is a reason a person can be rated medium or high risk. For each one: what makes it apply, and what eAML asks for because of it. Where a step depends on your firm’s risk appetite, it says so.
Customer factors
Who the customer is, what they do, and how they behave.
Cash-intensive business
The customer runs a business that takes much of its income in cash (for example hospitality, takeaway food, convenience stores, car washes, beauty services or cash-based trades). Cash takings can be used to mix the proceeds of crime with legitimate income: understand the business's expected turnover and check the source of funds against it.
Raises the rating when any of these is true
- High The firm grades the person’s kind of cash-intensive business as high riskAn answer is saved
- Medium The firm grades the person’s kind of cash-intensive business as medium riskAn answer is saved
Complex or opaque beneficial ownership structure
The party's disclosed ownership/control structure includes a nested entity with no owners of its own on record, or exceeds normal depth/breadth for a straightforward holding.
Raises the rating when
- High Vendor or buyer The ownership structure is complex or hides an ownerA check result comes back
What is asked for because of it
If your firm’s risk appetite for this factor is Apply enhanced customer due diligence:
- Vendor or buyer Ask for “Ownership and control chart” for enhanced due diligenceA check result comes back
Credible adverse media
Adverse media an officer judged to be about this person or company, and a concern: weigh it in the rating and apply enhanced due diligence.
Raises the rating when
- High An officer has reviewed the “Adverse media screening” result and recorded a concernA check result comes back
Customer refuses or delays providing CDD information
A customer unwilling or slow to provide identity or source-of-funds information is itself a recognised red flag, independent of anything else about them.
Raises the rating when
- High The person is the firm’s own client, not the other side of the deal (for a selling agent the vendor, for a buyer’s agent the buyer) and the person has not provided the requested customer due diligence information promptly and without unexplained reluctanceAn answer is saved
What is asked for because of it
If your firm’s risk appetite for this factor is Apply enhanced customer due diligence:
- Ask for “Independent referee reference” for enhanced due diligenceAn answer is saved
Customer's answers contradict each other
Several of the customer's answers can't both be true (income against salary, source of funds against its description, a PEP declaration against its category, payments against what was declared). Resolve each with the customer: correct the wrong answer, or record the explanation in the risk note.
Raises the rating when any of these is true
- Medium Some of the person’s answers contradict others and an officer has confirmed the contradiction as not explainedAn answer is saved
- High Many of the person’s answers contradict others and an officer has confirmed the contradiction as not explainedAn answer is saved
Foreign politically exposed person (PEP)
A foreign PEP, or a close associate/family member of one — AUSTRAC treats this as mandatory enhanced due diligence, always, not something a low score elsewhere can offset.
Raises the rating when
- High Staff have put the person in the foreign PEP categoryAn answer is saved
What is asked for because of it
If your firm’s risk appetite for this factor is Require source of funds / source of wealth verification:
- Ask for “Signed accountant letter” as evidence of the source of fundsAn answer is saved
Linked to another case of concern
The same person, bank account or property appears on another of the firm's cases, and the officer who reviewed it decided the link is a concern (for example the other case was declined, investigated or reported, or the person acts for several unrelated customers).
Raises the rating when
- High An officer has reviewed the “Same party across other cases” result and recorded a concernA check result comes back
Multiple moderate risk factors present
Several distinct risk factors have independently rated this party medium. A documented policy choice, not an AUSTRAC mandate.
Raises the rating when
- High The person has several medium-risk factorsAn answer is saved
What is asked for because of it
If your firm’s risk appetite for this factor is Apply enhanced customer due diligence:
- Ask for “Statutory declaration” for enhanced due diligenceAn answer is saved
If your firm’s risk appetite for this factor is Require source of funds / source of wealth verification:
- Ask for “Bank account statement” as evidence of the source of fundsAn answer is saved
Owned or controlled by a sanctioned person or entity
Someone who owns or controls the customer, directly or through other companies or trusts, has been confirmed as a match on a sanctions list. Dealing with the customer is dealing with their assets: the service can't go ahead.
Raises the rating when
- High Someone who owns or controls the person has been confirmed as a sanctions matchA check result comes back
Possible sanctions match not ruled out
Sanctions screening found a listing that may be this person or company, and it has not been ruled out as someone else. If it is them, the service can't go ahead: freeze any assets held, report to the Australian Sanctions Office (DFAT) and the AFP, and consider a suspicious matter report.
Raises the rating when
- High Either screening found a possible sanctions match, and no officer has ruled it out (it is not yet reviewed, or was reviewed as a concern) or a sanctions match has been confirmedA check result comes back
Suspected criminal or unusual activity
Personnel believe the customer may have engaged in criminal or unusual activity.
Raises the rating when
- High Staff think the person may have engaged in criminal or unusual activityAn answer is saved
Suspected false or fraudulent identity
Criminals can obtain services under a false identity — fake identification documents, false details on documentation, or technology (spoofed phone numbers/emails, deepfake images/video) used to impersonate someone else, avoiding detection and undermining an accurate ML/TF risk assessment.
Raises the rating when any of these is true
- High Vendor or buyer, and owner, officer or representative The identity check did not pass cleanly and needs reviewA check result comes back
- High Vendor or buyer, and owner, officer or representative The business check did not pass cleanly and needs reviewA check result comes back
Suspicious matter reported
A suspicious matter report has been drafted or lodged about this customer. If the firm keeps providing the service, apply enhanced customer due diligence and monitor the relationship closely, without telling the customer about the report.
Raises the rating when
- High A suspicious matter report has been made about themA suspicious matter report is made
Wealth sourced through a complex structure
The party's declared wealth passed through a trust, company or other legal structure before reaching them, distinct from the party's own type — based on what they've told you, not independently verified.
Raises the rating when
- High Vendor or buyer The person’s wealth passed through a trust, company or other structureAn answer is saved
What is asked for because of it
If your firm’s risk appetite for this factor is Require source of funds / source of wealth verification:
- Vendor or buyer Ask for “Signed accountant letter” as evidence of the source of fundsAn answer is saved
Customer is a minor
A party to the transaction is a minor. A minor cannot normally enter a binding sale contract, so a parent, guardian, trustee or estate administrator should be acting with evidenced authority. AUSTRAC's real-estate indicators name using a family member or other third party as legal owner to distance the real owner from illicit funds — establish who controls the transaction and who provides or receives the money.
Raises the rating when
- Medium The person is a minorA check result comes back
What is asked for because of it
Then also:
- Vendor or buyer Staff answer: “Review of who acts for a minor” (3 questions)A check result comes back
Domestic or international-organisation PEP
The customer or a related party is a domestic PEP or international-organisation PEP. A foreign PEP is rated separately, as high, under its own factor.
Raises the rating when any of these is true
- Medium Staff have put the person in the domestic PEP categoryAn answer is saved
- Medium Staff have put the person in the international-organisation PEP categoryAn answer is saved
What is asked for because of it
If your firm’s risk appetite for this factor is Require source of funds / source of wealth verification, and staff have put the person in the domestic PEP category:
- Ask for “Signed accountant letter” as evidence of the source of fundsAn answer is saved
If your firm’s risk appetite for this factor is Require source of funds / source of wealth verification, and staff have put the person in the international-organisation PEP category:
- Ask for “Signed accountant letter” as evidence of the source of fundsAn answer is saved
Non-profit organisation involvement
The customer, owner or controller is a non-profit organisation. This does not make the relationship suspicious by itself, but requires its purpose, controllers and funding to be understood.
Raises the rating when
- Medium The person is, or is owned or controlled by, a non-profit organisationAn answer is saved
What is asked for because of it
If your firm’s risk appetite for this factor is Apply enhanced customer due diligence:
- Ask for “Constitution, rules or charter” for enhanced due diligenceAn answer is saved
If your firm’s risk appetite for this factor is Require source of funds / source of wealth verification:
- Ask for “Signed accountant letter” as evidence of the source of fundsAn answer is saved
Overseas resident customer
Harder to independently verify identity and source of funds at a distance; residence in a FATF-listed high-risk country is rated separately, not folded into this one.
Raises the rating when any of these is true
- Medium Vendor The vendor lives outside Australia (a country of residence is recorded and it is not Australia)A vendor is added to the case
- Medium Buyer The buyer lives outside Australia (a country of residence is recorded and it is not Australia)Contracts are exchanged
What is asked for because of it
If your firm’s risk appetite for this factor is Apply enhanced customer due diligence:
- Vendor Ask for “Statutory declaration” for enhanced due diligenceA vendor is added to the case
- Buyer Ask for “Statutory declaration” for enhanced due diligenceContracts are exchanged
If your firm’s risk appetite for this factor is Require source of funds / source of wealth verification:
- Buyer Ask for “Bank account statement” as evidence of the source of fundsContracts are exchanged
Politically exposed person declared: category to be confirmed
The customer, an owner or a representative says they (or a family member or close associate) are a politically exposed person. Confirm the category: a foreign PEP is high risk and needs enhanced due diligence and senior management approval; a domestic or international-organisation PEP is rated on the other risks.
Raises the rating when any of these is true
- Medium Vendor or buyer The representative, a family member or a close associate is a politically exposed person (PEP)An answer is saved
- Medium Vendor or buyer, and owner or officer The person says they, a family member or a close associate is a politically exposed person (PEP)An answer is saved
Third-party representative is not an evidenced enrolled reporting entity
A third party acts for the customer and has not provided evidence that it is an AUSTRAC-enrolled reporting entity.
Raises the rating when
- Medium A third party acts for the person and is not an AUSTRAC-enrolled reporting entityAn answer is saved
What is asked for because of it
If your firm’s risk appetite for this factor is Apply enhanced customer due diligence:
- Ask for “AUSTRAC enrolment evidence” for enhanced due diligence, because the representative is not an enrolled reporting entityAn answer is saved
Trust or other legal arrangement
The customer acts through a company, trust or other legal arrangement. On its own this is common and rated medium; a complex or opaque ownership or control structure is rated separately, as high.
Raises the rating when
- Medium Vendor or buyer The person is buying or selling through a trust, company or other legal arrangementAn answer is saved
What is asked for because of it
If your firm’s risk appetite for this factor is Apply enhanced customer due diligence:
- Vendor or buyer Ask for “Trust deed” for enhanced due diligenceAn answer is saved
If your firm’s risk appetite for this factor is Require source of funds / source of wealth verification:
- Buyer Ask for “Signed accountant letter” as evidence of the source of fundsAn answer is saved for the buyer
Wealth sourced from overseas
Part of the party's declared wealth originated outside Australia, regardless of their current residency — based on what they've told you, not independently verified. Rated medium, not high: unlike residence in a FATF-listed jurisdiction, this isn't scoped to any specific higher-risk country — just "overseas" in general, a broader and less inherently risky category on its own.
Raises the rating when
- Medium Vendor or buyer Some of the person’s wealth came from outside AustraliaAn answer is saved
What is asked for because of it
If your firm’s risk appetite for this factor is Require source of funds / source of wealth verification:
- Vendor or buyer Ask for “Bank account statement” as evidence of the source of fundsAn answer is saved
Transaction factors
How the deal is paid for and structured.
Contract price inconsistent with the agency's own appraisal
The agreed sale price differs materially — well above or well below — from the agency's own pre-sale estimate of the property's market value, with no apparent explanation.
Raises the rating when
- High The contract price is well away from the agency’s appraisal, and no officer has ruled it out (it is not yet reviewed, or was reviewed as a concern)A check result comes back
Funded by a private person, syndicate or overseas lender
Unregulated private lending, or a lender based overseas: the "loan-back" AUSTRAC describes, where an offshore company controlled by the buyer poses as an arm's-length lender. Escalate to the compliance officer, verify the lender's identity and source of wealth, review the loan and mortgage documents, and trace the funds to the lender.
Raises the rating when
- High The lender is a private person, a group of investors or a lender based overseasAn answer is saved
What is asked for because of it
Then also:
- Raise the alert “Funding from a private lender”An answer is saved
Funded by a solicitor's loan or contributory mortgage
Funds pooled from investors, often through a legal trust account, which hides who is providing them. Review the loan agreement, identify the investors or the trust behind it, and trace the money to where it came from.
Raises the rating when
- High The lender is a solicitor’s contributory mortgage fundAn answer is saved
Funding sourced from a non-institutional or private lending arrangement
Raises the rating when
- High Vendor or buyer The funds come from a non-institutional or private lenderA check result comes back
What is asked for because of it
If your firm’s risk appetite for this factor is Require source of funds / source of wealth verification:
- Buyer Ask for “Bank account statement” about the private or non-bank lenderA check result comes back for the buyer
Funds from a third party, an undeclared account, or several payers
Money paid in by someone who isn't on the case, from an account the customer didn't declare, or pooled from several payers. The patterns of offsetting and underground banking, where the money that arrives isn't the money the customer moved. Find out who each payer is, how they're connected, and where their money came from.
Raises the rating when
- High Money came from a third party, an undeclared account or several payers, and no officer has ruled it out (it is not yet reviewed, or was reviewed as a concern)A check result comes back
High value physical currency transactions
Property purchased using a large amount of physical currency (Australian or foreign).
Raises the rating when any of these is true
- High Vendor or buyer A large cash payment has been recorded for the personA payment is recorded
- High The transaction will involve a large amount of physical cashAn answer is saved
What is asked for because of it
If your firm’s risk appetite for this factor is Require source of funds / source of wealth verification, and a large cash payment has been recorded for the person:
- Buyer Ask for “Bank account statement” as evidence of the source of fundsA payment is recorded for the buyer
If your firm’s risk appetite for this factor is Require payment via bank transfer, and a large cash payment has been recorded for the person:
- Vendor or buyer An officer decides: “Bank-transfer arrangement confirmed”A payment is recorded
Money paid in and refunded in a way that launders it
A payment refunded to someone other than the payer, to a different account, as a transfer for cash paid in, before due diligence was finished, after a deal ended with no clear reason, or handed back as an overpayment. A deposit paid and taken back is a known way to turn dirty money into a clean transfer from a trust account. Confirm who the money belongs to and why it went where it did, and consider whether an SMR is needed.
Raises the rating when
- High A refund went to someone else, to another account, or before due diligence was doneA check result comes back
Payment from a third party unrelated to the transaction
Funds arriving from someone with no apparent connection to the buyer or the property is a recognised red flag.
Raises the rating when
- High A third party who is not clearly connected with the person will pay and the third party is neither a lender nor a family memberAn answer is saved
What is asked for because of it
If your firm’s risk appetite for this factor is Require source of funds / source of wealth verification:
- Buyer Ask for “Bank account statement” about the third party who is payingAn answer is saved for the buyer
Payment using virtual assets
Some or all of the property transaction will be funded with cryptocurrency or another virtual asset, increasing traceability and source-of-funds risk.
Raises the rating when
- High A virtual asset or cryptocurrency will be used for part of the paymentAn answer is saved
What is asked for because of it
If your firm’s risk appetite for this factor is Require source of funds / source of wealth verification:
- Buyer Ask for “Bank account statement” as evidence of the source of fundsAn answer is saved for the buyer
Property value implausible for declared income/occupation
The relevant property price (the current sale for a buyer, the original purchase for a seller) is well beyond what the party's declared annual income (or, absent that, their declared occupation category's typical band) plausibly supports, with no evidence of financing through a recognised institution.
Raises the rating when
- High The property’s price looks out of line with the buyer’s declared income, and no officer has ruled it out (it is not yet reviewed, or was reviewed as a concern)A check result comes back
What is asked for because of it
If your firm’s risk appetite for this factor is Require source of funds / source of wealth verification, and the property’s price looks out of line with the buyer’s declared income:
- Buyer Ask for “Bank account statement” as evidence of the source of fundsA check result comes back for the buyer
Rapid on-sale or resale shortly after purchase
Property bought and resold in a short timeframe is a recognised layering pattern.
Raises the rating when
- High The property was bought and is being resold quickly, and no officer has ruled it out (it is not yet reviewed, or was reviewed as a concern)A check result comes back
Sale proceeds directed to an unconnected third party
Vendor sale proceeds paid to a bank account or person with no apparent connection to the vendor or transaction — a recognised technique for diverting or laundering value away from its legitimate recipient.
Raises the rating when
- High The proceeds of the sale will be paid to another person or account and the rest of the proceeds are going to neither the mortgage lender nor a trust accountAn answer is saved
Source of funds inconsistent with customer profile
The stated source of funds doesn't match the customer's occupation, business activity or known financial profile.
Raises the rating when any of these is true
- High Buyer The source of funds cross-check found that the funds declared do not cover the payments, and no explanation has been acceptedAn answer is saved for the buyer
- High The person appears to have wealth out of proportion to their known legitimate incomeAn answer is saved
- Medium Vendor or buyer Either the person put the source of funds in the “Other” category or one of the other sources of funds the person listed is in the “Other” categoryAn answer is saved
- Medium Vendor or buyer The person put the source of their wealth in the “Other” categoryAn answer is saved
What is asked for because of it
If your firm’s risk appetite for this factor is Require source of funds / source of wealth verification, and either the person put the source of funds in the “Other” category or one of the other sources of funds the person listed is in the “Other” category:
- Buyer Ask for “Signed accountant letter” because the declared source of funds does not cover the paymentsAn answer is saved for the buyer
Unusually complex, large or purposeless transaction
The requested service is unusually complex or large, or lacks an apparent economic or lawful purpose, requiring enhanced scrutiny and consideration of escalation.
Raises the rating when
- High The service or transaction is unusually complex, unusually large, or has no apparent purposeAn answer is saved
What is asked for because of it
If your firm’s risk appetite for this factor is Require source of funds / source of wealth verification:
- Buyer Ask for “Bank account statement” as evidence of the source of fundsAn answer is saved for the buyer
Funded by a non-bank lender or private credit fund
Non-bank lenders and private credit funds are reporting entities AUSTRAC rates medium risk as a sector, and see less of where a borrower's wealth comes from than a bank. Confirm the lender is enrolled with AUSTRAC and did its own due diligence, and review the loan and mortgage documents.
Raises the rating when
- Medium The lender is a non-bank lenderAn answer is saved
Funds from immediate family (a gift or family loan)
A parent, spouse or partner, or child is paying towards the purchase. Common and legitimate when documented: get a gift letter or statutory declaration, the giver's identity, and their bank statement showing the transfer.
Raises the rating when
- Medium A third party who is not clearly connected with the person will pay and the third party is a family memberAn answer is saved
Funds or wealth from a country with capital controls
Money paid in from, or wealth said to come from, a country that limits what its residents may send abroad. Not suspicious on its own: ask how the funds left the country and for evidence (remittance records, approvals). Where the country doesn't let its residents send money abroad to buy property, a property purchase funded from there needs a clear answer.
Raises the rating when
- Medium Money or wealth comes from a country that limits what its residents can send abroadA check result comes back
High-value real estate purchased without a mortgage
Raises the rating when
- Medium The property is of high value and is being bought without a mortgageAn answer is saved
What is asked for because of it
If your firm’s risk appetite for this factor is Require source of funds / source of wealth verification:
- Buyer Ask for “Bank account statement” as evidence of the source of fundsAn answer is saved for the buyer
Transactions structured to avoid the reporting threshold
Multiple linked transactions, each individually under the reporting threshold, that together reach it — a deliberate attempt to stay under the threshold-transaction-report trigger. AUSTRAC names this explicitly as an ongoing-CDD red flag. Not yet wired: needs real transaction entry (see transaction.linkedGroupId), which this system does not yet collect.
What eAML does about it
eAML looks for this and shows what it finds on the case for an officer to read. It does not change the rating by itself.
Then also:
- Vendor or buyer Run the check “Linked payments”A payment is recorded
Delivery channel factors
How the service is delivered: in person, remotely, through someone else.
Fully remote, no face-to-face interaction
Raises the rating when any of these is true
- High The relationship with the person is conducted wholly remotely, with no face-to-face contact and either the identity has not been verified online with the ID provider and passed or the person lives outside Australia (a country of residence is recorded and it is not Australia)An answer is saved
- Medium The relationship with the person is conducted wholly remotely, with no face-to-face contact and the identity check passed when it was done online with the ID provider and either no country of residence is recorded for the person or the person lives in AustraliaAn answer is saved
What is asked for because of it
If your firm’s risk appetite for this factor is Apply enhanced customer due diligence:
- Ask for “Statutory declaration” for enhanced due diligenceAn answer is saved
Verified remotely from another country or a hidden connection
The identity verification was done from a different country than the one the customer lives in, or through a VPN, proxy, Tor or a data centre, which hides where they are. Travelling is the usual explanation: ask, and accept it when it checks out. Unexplained, it can mean someone else is acting for the customer, or that they are overseas.
Raises the rating when
- High The remote identity check came from another country or a hidden connection, and no officer has ruled it out (it is not yet reviewed, or was reviewed as a concern)A check result comes back
Dealt with through an intermediary or agent
The customer is dealt with through someone else (an agent, adviser or other intermediary), so the firm never deals with them directly. Confirm the intermediary's authority to act and that the instructions are the customer's own.
Raises the rating when
- Medium An intermediary is used to deal with the personAn answer is saved
Country factors
Where the people and the money are.
Party resident in a FATF-listed high-risk jurisdiction
The party is resident in a country on FATF's list of jurisdictions with strategic AML/CTF deficiencies — either the black list (call for action) or the grey list (increased monitoring). Either listing raises this factor; which one applies is shown alongside the result so a compliance officer can weigh it.
Raises the rating when
- High Vendor or buyer, and owner, officer or representative The country check found a high-risk countryA check result comes back
What is asked for because of it
If your firm’s risk appetite for this factor is Apply enhanced customer due diligence:
- Vendor or buyer Ask for “Foreign national ID card” for enhanced due diligenceA check result comes back
If your firm’s risk appetite for this factor is Require source of funds / source of wealth verification:
- Buyer Ask for “Bank account statement” as evidence of the source of fundsA check result comes back for the buyer