New Zealand introduced new amendments to its Anti-Money Laundering and Countering Financing of Terrorism (AML/CFT) Amendment Act 2017 (Phase 2) in an effort to prevent money laundering, terrorist financing and increase the difficulty for criminals to profit from illicit activities. New Zealand’s government estimates that approximately NZ$1.35 billion is laundered every year with the proceeds coming from fraud and the drug trade.
The new amendment requires all financial institutions to provide information on clients who make cash transactions over NZ$10,000 and international monetary wire transfers out of the country that are greater than NZ$1000 to the Police Financial Intelligence Unit (PFIU). Accountants and other institutions outside of the financial sector accepting or distributing large amounts of money into New Zealand will also be required to confirm client identities, perform risk assessments, and report suspicious transactions to the PFIU. Accounting firms will now be liable to report suspicious transactions after a grace period ending October 1, 2018. In addition, the new laws under Phase 2 of the Act will expand to cover more entities including conveyancers, real estate agents, numerous lawyers and accountants, and businesses involving wagers on sports and races.
Deputy secretary policy for New Zealand Ministry of Justice, Rajesh Chhana, stated her hopes for the new amendments to strengthen and keep anti-money laundering (AML) laws effective while keeping the impact on businesses small. However, 2compli co-founder, John Parker, believes businesses will greatly be impacted depending on the size of the business, customers, services and so on. Parker stated “The legislation will have a bigger impact on accountants whose business operates within areas susceptible to money laundering and finance of terrorism. This includes any areas that promote anonymity, such as trusts, limited partnerships, and charities.”
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