MFAA Issues Guidance on Broker Referral Risks

The Mortgage and Finance Association of Australia has set out warning signs and due diligence steps for managing referral relationships.

Updated on Nov. 4, 2026 in Financial Crime

Isometric editorial illustration of a brass key before a plain cream gate lock, suggesting verification and access control in referral arrangements. — The Mortgage and Finance Association of Australia issued guidance this week urging brokers to scrutinise referral arrangements that obscure who is behind a client's application. AI Illustration. Upload story photo >

The Mortgage and Finance Association of Australia (MFAA) has introduced guidance for brokers managing referral relationships. The guidance lists warning signs that a referral arrangement may warrant further enquiry.

Why it matters

Referral relationships can obscure who is behind a client's application, creating financial crime risk for brokers. Regular review helps keep these arrangements transparent and appropriate as circumstances change.

The guidance sets out ten recommended practices, including verifying referrer registrations and documenting roles and payments in referral arrangements. It does not identify any current investigation or enforcement matter.

The players

Mortgage and Finance Association of Australia (MFAA)

The MFAA is the national industry body for mortgage and finance brokers in Australia, which sets professional standards and guidance for its members.

The details

The guidance identifies warning signs such as a referrer refusing to disclose identity or ownership, managing every client conversation, or refusing due diligence. Brokers are advised to confirm clients understand who referred them, maintain direct client contact, and prioritise higher-risk arrangements, with possible responses including additional checks, file reviews, compliance support or suspending referrals.

4 November 2026: MFAA introduces the broker guidance on managing referral relationships.

Legal Context

The guidance extends the MFAA's member standards framework to referral arrangements, an area where opaque intermediaries can conceal the true source of a loan application. It frames referral oversight as an ongoing obligation rather than a one-off check at onboarding.

Clients using a mortgage broker may be asked to confirm who referred them and to explain their application in their own words. Brokers working with referrers may face additional checks, file reviews or temporary suspension of referral arrangements.

The takeaway

Brokers should confirm who referred each client, verify referrer registrations, and document roles and payments in writing. Regular review keeps referral arrangements transparent as circumstances change.