New Zealand's new Anti-Money Laundering (AML) regulatory regime, taking effect from 30 June, will help to take the profit out of crime, reduce the chances of New Zealand being involved in terrorism financing and enhance New Zealand's reputation on the global stage, Reserve Bank Anti-Money Laundering manager Rob Edwards said today.
In a speech to an Anti-Money Laundering and Countering Financing of Terrorism seminar in Wellington, Mr Edwards said there were two key reasons the new AML regime is important.
Speech: Anti-money laundering - thoughts from an AML/CFT supervisor
"First, our AML regime is part of a co-ordinated international effort to tackle two worldwide problems: criminal activity that is made more attractive when the proceeds are able to be laundered, and the funding of terrorist attacks.
"The second purpose of the Anti-Money Laundering and Countering Financing of Terrorism Act 2009 is to maintain and enhance New Zealand's international reputation for a sound and high-integrity business environment."
The Reserve Bank, the Department of Internal Affairs and the Financial Markets Authority are tasked with supervising entities under the Act and are well placed to begin their new role, Mr Edwards said. The purpose of this supervision is to check that firms have the systems in place to comply with their AML obligations, including detecting and reporting suspicious activity.
While the new regime beds in, the emphasis will be on the monitoring of compliance with the Act.
"We expect that our monitoring activity will alert us to any breaches that will be investigated and potentially result in enforcement actions.
"Supervision is a two-way street; willing and enthusiastic participation by industry will make the process more efficient and make the regime more effective," Mr Edwards said.
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Notes to editors
Money laundering is how criminals disguise the illegal origins of their money. Financers 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 Reserve Bank of New Zealand supervises banks, life insurers, and non-bank deposit takers.
Anti-money laundering and countering terrorism financing
The Financial Markets Authority supervises issuers of securities, trustee companies, futures dealers, collective investment schemes, brokers, and financial advisers.
The Department of Internal Affairs supervises casinos, non-deposit taking lenders, money changers, and any other financial institutions not supervised by The Reserve Bank or The Financial Markets Authority.
Department of Internal Affairs
Examples of financial activities regulated under the AML/CFT Act include (but are not limited to):
- accepting deposits or other repayable funds from the public
- making a loan to or for a customer
- issuing a debit or credit card
- managing the means of payment
- supplying goods through a finance lease (other than for consumer products)
- providing remittance services which transfer money or property
- issuing or accepting liability under life insurance policies
- issuing or selling securities and derivatives
- safekeeping or administering cash or liquid securities on behalf of other persons
- exchanging foreign currency.