Money laundering is principally a means to disguise the source of criminal funds. Its secondary objectives include providing a safe haven for those funds, and provide a financial return from them by using legitimate business activities. The Anti-Money Laundering and Countering Financing of Terrorism Act 2009 (AML/CFT Act) was passed on 15 October 2009. The Act forms part of a legislative package that will implement the first tranche of reforms to New Zealand’s anti-money laundering and countering financing of terrorism regulatory regime. The new law formally recognises that effective control of money laundering and crime that leads to it needs collaboration between the financial sector and government. Background The Act seeks to bring New Zealand into line with the international standards for AML/CFT frameworks.
The Act provides the following:
- A set of reporting requirements for entities covered by the Act
- A risk-based approach to tracking possible money laundering and terrorism financing activity, which is intended to minimise compliance costs
- An enforcement regime, including new civil and criminal offences
- A regime for supervision, monitoring and enforcement of AML/CFT obligations involving three supervisors - the Reserve Bank of New Zealand, the Securities Commission and the Department of Internal Affairs.
Under the Act, the Police Financial Intelligence Unit (FIU) will continue its role of receiving and analysing suspicious transaction reports. About the Act The Act covers the financial sector, casinos and any person (natural or legal) declared by regulations to be required to comply with the Act. These groups of persons are collectively referred to as “reporting entities”.
Reporting entities will be required to fully implement provisions of the Act on a date to be appointed by the Governor-General by Order in Council. Full implementation will be determined following consultation with industry.
The Act imposes a number of obligations on reporting entities. These obligations include:
- An assessment of the money laundering and the financing of terrorism (ML/FT) risk that it may reasonably expect to face in the course of its business
- Establishing, implementing and maintaining an AML/CFT compliance programme that includes internal procedures, policies and controls to detect, manage and mitigate ML/FT
- Customer due diligence (CDD), including customer identification and verification of identity and ongoing CDD
- Suspicious transaction reporting
- Record keeping.
The Act will incorporate a risk based approach to compliance. Reporting entities will (within the limits prescribed by the Act and Regulations) have some flexibility to determine the way in which they meet their o- .....The first part of this topic has been displayed free of charge. Join up for $45 to have access to this and all other topics!
|
