FIRB approval is not identity verification

A foreign buyer's file shows a FIRB approval number. That is not the same as your agency having verified who the buyer is.

The fastest way to have your own record

The fix is not "check FIRB status more carefully." It is running your own AML/CTF customer due diligence on every foreign buyer, separate from whatever foreign investment approval they hold.

Sign up (around 2 minutes). Enter your ABN and AML Simple pulls your registered business details from the ABR automatically.
AUSTRAC Readiness Check (around 5 minutes). Shows exactly where your agency's program stands against Tranche 2 obligations, including customer due diligence.
Client screening. You verify identity and run sanctions and PEP screening on the foreign buyer yourself, timestamped and stored against that file. A FIRB approval number does not go in this field, because it is not a substitute for it.

Your agency has its own evidence trail on that client, independent of any approval issued by another body for a different purpose.

Two regimes, two different questions

FIRB approval answers a foreign investment question: is this person or entity permitted to acquire this asset under Australia's foreign investment rules. That process sits with the Foreign Investment Review Board and the Treasury, not AUSTRAC, and it is not part of AML/CTF Tranche 2. We are not going to describe its process, thresholds, or timing here. If your situation turns on a FIRB detail, that is a question for your own adviser or FIRB directly, not for this post.

AML/CTF customer due diligence answers a different question: who is this person, verified against real evidence, and does providing them a designated service create a money laundering, terrorism financing, or proliferation financing risk your agency needs to manage.

Real estate agents provide a designated service when brokering the purchase, sale, or transfer of real estate for other people as part of a business. That obligation attaches to the agency directly. Nothing about a buyer separately clearing an unrelated approval process changes what the agency itself is required to do.

Why the assumption is easy to make

A foreign buyer with FIRB approval has clearly been through some kind of check. It is a natural leap from there to "someone has already looked at this person, so my file is covered." But FIRB approval was never assessing identity for AML/CTF purposes, and nothing in it produces a CDD record your agency can rely on.

Under Tranche 2, each reporting entity in a transaction carries its own obligation to conduct customer due diligence and keep its own records. There is a narrow, specific mechanism for one reporting entity to rely on another's CDD, in AML/CTF Rules 2025 (Division 8, dealing with reliance on collection and verification of KYC information), but only where the conditions in that rule are met and the reliance is documented. FIRB is not a reporting entity performing CDD under that framework, so there is nothing to rely on there in the first place.

What this looks like in practice

An offshore buyer's file arrives with a FIRB approval number attached, and the deal moves forward on the assumption that the buyer has already been checked. Settlement approaches, and your agency has no independent identity verification, no sanctions or PEP screening result, and no beneficial ownership check for that client, because the FIRB approval was treated as if it covered all of it.

If AUSTRAC asks for this agency's own evidence that it identified and verified this client, a FIRB approval number is not that evidence. It answers a different question, from a different body, for a different purpose.

Doing it yourself

If you're not using a tool for this, the same steps still apply manually, foreign buyer or not:

Collect identity information from the client directly, using accepted document types, rather than inferring identity from a separate approval process
Run sanctions and PEP screening against DFAT and international lists, and record the result with a timestamp
Identify beneficial owners where the buyer is a company, trust, or other structure, at the 25% ownership or effective control threshold
Keep every record for 7 years, per the general record-keeping obligation in AML/CTF Act 2006 s 107

Penalties for non-compliance can reach up to A$36,400,000 per contravention for a body corporate, or up to A$7,280,000 per contravention for an individual, under AML/CTF Act 2006 s 175.

The point that matters

FIRB approval and AML/CTF customer due diligence are separate checks run by separate bodies for separate reasons, and only one of them is your agency's job. Get started free and have your own record in place before it's needed.