New anti-money laundering laws introduced
On 13 March 2017, the Minister of Justice, the Hon Amy Adams, introduced the Anti-Money Laundering and Countering Financing of Terrorism Amendment Bill (248-1). The Bill is intended to bolster New Zealand’s existing anti-money laundering laws which help to protect businesses and make it harder for criminals to profit from and fund illegal activities.
Money laundering is the process by which money obtained through crime is made legitimate to conceal its criminal origins. Financiers of terrorism use similar techniques to money launderers to avoid detection by authorities and to protect the identity of those providing and receiving the funds.
The Bill proposes amendments to the Anti-Money Laundering and Countering Financing of Terrorism Act 2009 (the Act). The Act currently applies to banks, financial institutions, and casinos, and sets out those entities’ core obligations, including:
- developing a risk assessment and compliance programme
- undertaking customer due diligence (customer identification and verification)
- account monitoring, and
- submitting suspicious transaction reports to the Financial Intelligence Unit of the New Zealand Police.
The Bill extends the obligations to real estate agents, lawyers, accountants, conveyancers, the New Zealand Racing Board, and some high-value dealers. When undertaking certain activities that pose a high risk for money laundering and terrorism financing, these sectors will be required to know who their customers are and on whose behalf they act. The sectors will be required to report large cash transactions, and (other than high-value dealers) will also be required to report suspicious activity, and develop and maintain a risk assessment and compliance programme. High-value dealers will be able, but not required, to report suspicious activities that come to their attention.
The Bill also establishes the Department of Internal Affairs as the relevant anti-money laundering and countering financing of terrorism supervisor for these sectors.
Businesses will have a period of time to prepare for the changes. The Government will provide guidance and information to help businesses understand, prepare for and comply with the law.