Anti-Money Laundering Requirements

Chances are, if you have recently approached us for legal assistance, you would have received an email from us with details of the new Anti-Money Laundering (AML) requirements.

The purpose of the ‘Anti-Money Laundering and Countering Financing of Terrorism Act 2009’ is to detect and deter money laundering and the financing of terrorism. ‘Money Laundering’ is a term for the process of disguising (‘laundering’) the illegal origins of the money from criminal activity. People who finance terrorism use similar methods to disguise their identity and the movement of money to terrorist organisations.
The Act began as a way to ensure that New Zealand was not lagging behind other countries in tightening up its finance laws and opposing terrorism. But while New Zealand was previously considered somewhat immune, it is now estimated that almost $1.5 billion is laundered through Kiwi businesses – shocking right?!

So, how does this impact you going forward? 

From 01 July 2018, most New Zealand law firms are now required to report to the Department of Internal Affairs on any suspicious financial transactions. Banks and other financial service providers have had to comply with the Act’s requirements since 2013, while later this year and early next year, Accountants and Real Estate agents will also be required to report.

This means that we are legally obligated to positively identify our clients (and sometimes related individuals and/or the source of funds) before we begin acting on any instructions from you, which will or could include the creation of legal entities and/or the movement of money. This ID verification isn’t just limited to new clients – even if we’ve known you for years we will still need to request this information from you, so please don’t be offended or discouraged if we suddenly ask you to prove who you are. It’s not personal; we would even have to ID our own mothers!
Once we hold a record of this information, we will not need to ask you for it again until the form of identification you have provided has expired.

Given we all enjoy New Zealand’s reputation as a fair and decent place, we should consider this Anti-Money Laundering verification process a small but very necessary part in preventing the illegal movement of money. This is for the betterment of not only our country, but for the rest of the world.

It’s helpful to get an idea of how money-laundering works so it puts things into perspective. Take a look at this article, which explains the general process as well as popular techniques that authorities are now well aware of, along with some pretty interesting case examples: https://money.howstuffworks.com/money-laundering.htm

We understand this is new, you may have some questions or would like some more information on Anti-Money Laundering, so please do not hesitate to phone us on 04 970 3600 or email info@wakefieldslaw.com to discuss AML requirements or find out more about the identification/evidence you may be asked to provide.