What are NOT valid reasons to allow Delayed Customer Due Diligence?
AUSTRAC rules out customer hurry, immature internal systems, untrained staff, cost concerns, vendor reluctance to provide ID, or unsettled agency policies as reasons to delay initial CDD.
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?