The AML/CFT Act was extended to lawyers and conveyancers on 1 July 2018. It will be extended to accountants on 1 October 2018 and will be further extended to Real Estate Agents on 1 January 2019. We also consider many financial service providers (including in some cases of businesses offering credit contracts) may be unaware that they are required to comply with the AML/CFT Act or may not be meeting the standards required.
We have specialist expertise in this area at McVeagh Fleming and can help you understand your compliance requirements under the AML/CFT Act. As a law firm, we have also had to practically comply with the AML/CFT Act ourselves, so we have "hands on" experience and provide practical advice in a real world context. We genuinely understand and can sympathise with clients that are required to comply with a complex and sometimes confusing statute that changes – in some areas significantly – the way they need to do business.
The AML/CFT Act is complex and imposes high standards on businesses and there is a lot of misinformation about it – with people tending to believe advice that allows them to do less, when more is usually required – and prudent where there are still latent ambiguities and grey areas in the application of the AML/CFT Act. The penalty of $5.3 million ordered in respect of Ping An Finance (Group) New Zealand Company Limited was levied in the case of almost total non-compliance. However, in a recent case at almost the complete opposite of the spectrum, Department of Internal Affairs v Qian DuoDuo Limited  NZHC 1887 [27 July 2018] Quan DuoDuo was fined $365,000 demonstrated that even parties that try to comply, but do not meet the requirements of the AML/CFT Act will likely be the subject of large pecuniary penalties. In Quan DuoDuo, the defendant company in good faith relied on advice of consultants and AML auditors, but that advice was faulty – and the company had insufficient systems and procedures as a consequence. It also made the wrong choice in respect of interpretation of a latent ambiguity in the AML/CFT Act, preferring an interpretation that required less in compliance. The case demonstrates that specialised legal advice is critical and high standards are expected in respect of businesses’ AML policies and systems.
If you need specialist assistance or advice in respect of your AML/CFT obligations or assistance or a review of your AML practices, systems and procedures, please contact:
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© McVeagh Fleming 2018
This article is published for general information purposes only. Legal content in this article is necessarily of a general nature and should not be relied upon as legal advice. If you require specific legal advice in respect of any legal issue, you should always engage a lawyer to provide that advice.