Happened to me as well when I applied for this transaction account with Citi. Had a credit card with them for years.
But then again, my sister had an American Express for years, then I wanted to give her a supplementary card, and American Express still wanted her to do an ID check. At least Australia Post has a contract to do ID check for Citi. American Express does not, so it's a lot more difficult to get it done.
Go to another post office. I had my ID check for Citi done at a post office.