Employee due diligence: the AML requirement most real estate agencies haven't thought about — AML Simple

Most agencies preparing for 1 July 2026 are focused on two things: building their AML/CTF program and verifying clients.

Both are correct priorities.

But there is a third requirement sitting quietly in the program checklist that almost nobody is talking about: employee due diligence.

What employee due diligence actually is

Employee due diligence is the process of screening and assessing staff members who perform AML-relevant duties at your agency.

It is a mandatory component of every AML/CTF program under the Anti-Money Laundering and Counter-Terrorism Financing Act 2006.

The idea is straightforward: agencies handling property transactions are handling the exact channel that AUSTRAC considers high-risk for money laundering. If a staff member is compromised, coerced, or acting dishonestly, they can become a vector for that risk. Your program must address that possibility.

Employee due diligence is how you document that you have done so.

Who it covers

Employee due diligence applies to staff who perform AML-relevant duties.

In a real estate agency, that means any staff member who:

Conducts customer identification or verification
Reviews customer risk ratings
Handles or reviews source-of-funds documentation
Monitors transactions for suspicious activity
Has access to compliance records or reporting systems

In a 5-person agency, that is likely everyone above admin level. In a larger agency, it may be a defined subset of staff.

The compliance officer role also falls under these requirements. If the principal holds that role, the principal is subject to the same screening.

What it requires

Your AML/CTF program must establish procedures for conducting employee due diligence on staff in AML-relevant roles.

At minimum, that means your program documents:

Which roles are AML-relevant — clear criteria for identifying who falls within scope
What screening is conducted — the checks you perform before a person starts in an AML-relevant role (and what triggers a review after they have started)
How results are recorded and retained — employee due diligence records must be kept for 7 years, like all other AML records
What happens when a check raises concerns — your escalation process

AUSTRAC does not prescribe a specific list of checks. The approach is risk-based: what is appropriate will depend on the role's access to compliance functions and the level of risk it carries.

Common approaches include a police check or equivalent credential check, alongside a review of prior employment or professional registration. But the specific checks you run should reflect a risk assessment of each role — the compliance officer position warrants more scrutiny than an admin role with limited system access. Document what you assessed and why you are satisfied.

The point is not the specific check. It is that you have a documented procedure, you applied it, and you kept the records.

The fast path: set it up in the platform

AML Simple includes an employee due diligence section in your AML/CTF program wizard.

You define which roles at your agency are AML-relevant, set out your screening procedure, and record completion for each staff member. That documentation is stored in your account for 7 years automatically.

Three steps to get this done:

Start your AML/CTF program in AML Simple — the program wizard walks you through each required component, including employee due diligence
Define your AML-relevant roles — the wizard prompts you to identify which staff need to be screened
Record your screening outcomes — log what checks were completed and when for each person

Your employee due diligence records are then part of your program documentation, ready for any AUSTRAC review.

Why this is worth doing before July 1, not after

Your program must be in place before your obligations commence on 1 July 2026.

Employee due diligence is part of the program. That means the policy must exist before July 1. For most agencies, that also means running the actual screening before that date, so that staff performing AML-relevant duties are already cleared when obligations start.

Doing it after the fact leaves a gap. If AUSTRAC reviews your program and finds no documented employee due diligence, that is a program deficiency, regardless of whether a suspicious matter ever occurred.

The good news is that for a small agency, this is not a complicated process. It is documentation discipline more than operational overhead.

What the market is saying

At the REIV AML/CTF Summit in late April 2026, the Real Estate Employers' Federation (REEF) presented guidance on HR obligations in the AML era, including employment contracts, position descriptions, and appropriate considerations for staff taking on AML Supervisor responsibilities.

The fact that an employer body is now publishing formal guidance on AML employment obligations is a signal: agencies are starting to ask the HR questions, not just the compliance questions.

Employee due diligence sits at the intersection of both.

What to do this week

If your agency has not yet mapped which staff roles are AML-relevant, that is the first step.

Write down who at your agency does what, in relation to client identity, risk assessment, and transaction monitoring. That list tells you who your employee due diligence procedure needs to cover.

Then document what you will check, who is responsible for running those checks, and where the records will be kept.

If your AML/CTF program is not yet built, AML Simple's program wizard takes you through each of these components, including employee due diligence, in one guided workflow.

Obligations start in 61 days.

Sources: Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (AML/CTF Act 2006); AUSTRAC Real Estate Program Starter Kit and Tranche 2 guidance for real estate agents (austrac.gov.au/reforms/sector-specific-guidance/real-estate-guidance).