How does the PEXA Residential Seller Guarantee protect vendors against fraud?

Lisa Dowie, Chief Customer Officer at Property Exchange Australia (PEXA) discusses PEXA’s recently announced Residential Seller Guarantee (Guarantee). A first of its kind, the digital-only guarantee provides protection to sellers in the event of a specific type of fraud. 

Lisa Dowie

How does it work?

Lawyers and Conveyancers use PEXA – Australia’s online property lodgement and settlements platform – to provide outstanding customer service to their clients. Completing property transactions online not only reduces the possibility of a multitude of risks and errors, but more importantly, it provides sellers with quick access to cleared funds, buyers are able to lodge documents transferring ownership in real time and what’s more, it is safer than the paper-based process.

The Guarantee was implemented to provide an additional safeguard to residential property sellers. In the event that a specific type of cyber-fraud occurs to which the Guarantee applies, the seller has the option to make a claim directly to PEXA, rather than seeking to recover the loss by an alternative means.

The Guarantee came into force on 29 June 2018 and applies to sellers of residential property if their lawyer or conveyancer was using PEXA to settle their property when the fraud occurred.

To be eligible, the following steps must occur:

  • The seller’s lawyer or conveyancer must accurately enter the seller’s bank account details into a PEXA Workspace.
  • Once this has occurred, but before settlement takes place, a person other than the lawyer or conveyancer, i.e. the fraudster, gains unauthorised access to the Workspace and changes the seller’s bank account details.
  • As a result of the fraudster’s actions, the funds do not reach the seller’s bank account.

The purpose of the Guarantee is to ensure that sellers are not left homeless as a result of the fraud described above. However, it is important to note that there is a $2 million cap on PEXA’s liability per settlement and further conditions must be satisfied before a claim can be made. A summary of the conditions can be found here.

How many claims have been made under the Guarantee?

Since the implementation of the Guarantee, not a single claim has been made. The likelihood of such fraud occurring is very low as a result of PEXA’s robust security measures, which include the following additions:

  • Multi-Factor Authentication which requires the user to provide two or more types of evidence to verify their identity when logging in to an account or completing a transaction.
  • Increased monitoring of unusual activity surrounding password resets, new user creations and changes to BSB and account numbers. If such activity is detected by PEXA, a member of PEXA’s team will contact members to confirm that the activity is legitimate.
  • Machine learning algorithms to detect behavioural anomalies on a per user basis. If the behavioural pattern of a user changes, PEXA’s risk profiling mechanism is activated to trigger an alert. The member will then be promptly contacted by PEXA’s security team.
  • Workspace time stamps and summary screen so that members can see when the Financial Settlement Schedule was last updated and by which user.

How to ensure your client is covered

Emma Elsworth, Senior Lawyer recently spoke with PEXA CEO Marcus Price about the Guarantee and has this advice for lawyers and conveyancers:

“It’s up to us as practitioners to explain the [electronic] process to our clients and we can give them the comfort that they are looking for”, said Emma.

“It’s going to provide practitioners, clients and other stakeholders in the market with reassurance that the PEXA platform is safe and reliable. As a practitioner I think it’d be wise for practitioners to look at their internal processes and say to their clients to contact them immediately if they haven’t received sale proceeds within 24 hours.”

Once the client’s lawyer or conveyancer is contacted, they can then reach out to PEXA. In turn, PEXA will contact the bank to which the vendor’s funds were paid and work with them to stop any withdrawal of those funds – significantly reducing the likelihood of funds being unrecoverable.  A claim against the PRSG can be made by completing and signing the Claim Form with PEXA.

What’s next for online security and e-Conveyancing?

PEXA continues to explore new techniques and technologies to stay ahead of the ever-changing security landscape. This includes a soon-to-be-released ‘secure app’ for PEXA members to send and receive instructions via secure channels. The first iteration will allow for bank details to be requested and received safely via the app.

To understand the PEXA Residential Seller Guarantee in greater detail, consumers should refer to the PEXA website and practitioners can ask questions and seek assistance from their peers on the PEXA online Community forum.

Lisa Dowie joined PEXA in November 2012 and has held senior positions in Technology and Operations. She represents the interests of lawyers and conveyancers across Australia, assisting the market’s transition to the digital era of property settlement. Guidance is provided through the PEXA Direct program, with a national team of specialists visiting the offices of lawyers and conveyancers to offer hands-on training. Lisa has extensive experience in leading transformation, stakeholder management and operational excellence. As a senior leader in the financial and information technology industries, Lisa has successfully delivered large-scale change, driving a superior customer experience. Contact Lisa at

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