Company director phone instructions in conveyancing
Someone who says they are a director calls with changed settlement instructions or bank details. Four different questions sit inside that call. Consider each one, alongside the other checks your transaction requires, before you act.
Knowing the voice is not the same as knowing the authority.
When an individual instructs personally, the caller and the client can be the same person. A company client always acts through a person, and establishing who that person is does not establish their current authority to give this instruction.
LPLC describes claims in which a company search would have shown that the instructing person was not a director and that authority needed to be confirmed with the directors. A familiar name can make a fraudulent instruction feel routine.
Answer each one on its own evidence.
- 01
Does the company exist and can it deal with this property?
ARNECC Guidance Note 4 gives an ASIC search, a title search and the company constitution as possible enquiries when you assess a company client's right to deal; what is reasonable depends on the circumstances. Start at engagement, and revisit it if later instructions raise doubt.
ARNECC Guidance Note 4: Right to Deal - 02
Does this person hold the authority they are using?
Landgate (WA) says subscribers must verify a company officer's or agent's authority to bind the client to the Client Authorisation and the conveyancing transaction. QLS makes the wider point that establishing who someone is does not establish their authority to instruct. Get current officeholder information, and back the authority for this instruction with its own evidence.
Landgate: Subscriber compliance - 03
Is the person on the phone the officer they say they are?
Caller ID can be spoofed and does not establish who is calling. Call back on a trusted number you obtained independently, not one displayed on the call or supplied with the change request.
ACMA: Caller ID scams - 04
Is this particular instruction genuine and correctly recorded?
For bank details, follow LPLC's full procedure: an independent call to a trusted number, a complete read-back of the BSB and account number, comparison with the written instructions, and a file note. A phone instruction is not a substitute for the Client Authorisation the applicable rules require.
LPLC: Call before you pay
What to keep with the matter
- Who called, the number you reached them on and how you got that number
- The date and time of the call and who at the firm took it
- The exact instruction, including any BSB and account number read back in full
- Current officeholder information and, separately, the evidence of authority for this instruction (resolution, delegation or power of attorney)
- The current Client Authorisation, and whether this change falls inside it
- Who approved acting on it, or why the firm stopped
This is a suggested record, not a legal minimum. Retention rules vary: Tasmania, for example, requires subscribers to keep specified supporting evidence for seven years from lodgment. Check the conveyancing, professional and other retention rules that apply to you.
A code check is one input. It doesn't answer any of the four questions on its own.
Vericode sends a short code to a mobile number your firm already holds and records the result in your dashboard. A correct read-back shows the caller had access to the code sent to that number. That access could be through another person, so it is not proof of identity or of who controls the phone.
It does not establish who the caller is, whether they are still a director, whether they have authority for this change, whether the instruction is genuine or who owns the bank account. Those need your separate identity, authority and payment-verification procedures. Vericode is not a VOI service, and a successful check does not establish compliance with Participation Rules, VOI or AML/CTF requirements; the firm remains responsible for its obligations.
- QLS: Verification of client identity
- LPLC: Do they have the authority?
- ASIC: Companies and organisations search
- NSW Registrar General: Subscriber compliance
- Tasmania: Retention of evidence
- Scamwatch: Business email compromise scams
These organisations are cited for general guidance, not as endorsers of Vericode.
Explain your checking procedure to company clients at engagement.
Record who can instruct, the scope of their authority and its evidence, and trusted contact details. Keep them current, and apply the full payment-verification procedure to any change.