What are NOT valid reasons to allow Delayed Customer Due Diligence?
AUSTRAC rules out customer hurry, immature internal systems, untrained staff, cost concerns.
Useful for prospect education - AUSTRAC's stated position rules out:
- Customer is in a hurry / wants to move fast
- Internal systems are slow or not yet built
- Staff haven't been trained on CDD yet
- Cost or commercial efficiency concerns
- The vendor doesn't want to be asked for ID
- The agency hasn't decided how to handle CDD
The "interruption to ordinary course of business" test is about the transaction's operational reality (e.g., the auction structure, the exchange-to-settlement timing), not the agency's readiness.
AUSTRAC source links - delayed initial CDD
Primary:
Supporting:
- Real estate designated services
- Professional designated services
- Initial customer due diligence
- Overview of customer due diligence
Related articles
- Does Tranche 2 apply at contract signing or at settlement for property transactions?
- How does delayed diligence apply to conveyancers, lawyers, and settlement agents (Rules s 6-15)?
- What's the difference between CDD, KYC and KYB - and when does each apply?
- How does CDD work for an off-the-plan purchase where settlement is years away?
- How long is a KYC valid? When does it need to be redone?