{"id":71,"date":"2018-03-21T23:00:00","date_gmt":"2018-03-21T13:00:00","guid":{"rendered":"https:\/\/hub.findingsimple.com\/nz\/posts\/amlcft-guide-for-lawyers"},"modified":"2023-03-13T02:41:07","modified_gmt":"2023-03-13T02:41:07","slug":"amlcft-guide-for-lawyers","status":"publish","type":"post","link":"https:\/\/insight.thomsonreuters.co.nz\/legal\/posts\/amlcft-guide-for-lawyers","title":{"rendered":"The Anti-Money Laundering\u00a0and Countering Financing of Terrorism (AML\/CFT) Amendment Act: A Guide for Lawyers"},"content":{"rendered":"

Phase 2 of the implementation of changes to the Anti-Money Laundering and Countering Financing of Terrorism (AML\/CFT) Amendment Act come into force throughout 2018 and 2019 in an incremental roll-out. The legal profession leads the list of those impacted. Lawyers and conveyancers must be compliant by 1 July 2018. That’s in less than 4 months\u2019 time.<\/p>\n

Are you ready?<\/span><\/h2>\n

Thomson Reuters NZ recently hosted a one day Anti-Money Laundering Conference<\/a> to help lawyers understand and comply with the Phase 2 demands.<\/p>\n

Carefully compiled sessions gave attendees an overview of what must be done, why and how. The goal was to have people leaving at the end of the day with enough knowledge and confidence to set about ensuring their businesses were fully compliant.<\/p>\n

This article summarises sessions on the need for change; what the Department of Internal Affairs (DIA) identified as risks within the legal sector; the red flag indicators the police saw as warranting further investigation; and the role of thorough customer due diligence in preventing money laundering or financing of terrorism.<\/p>\n

Why we need to change<\/span><\/h2>\n

Why we need these changes was covered by Nathan Lynch, Regional Bureau Chief APAC, Financial Crime and Risk, Regulatory Intelligence, Thomson Reuters (Aus).<\/p>\n

…low-corruption countries, like ours, with light-touch AML\/CFT regulations are attractive havens…<\/p><\/blockquote>\n

New Zealand’s reputation as a transparent and low-risk market has been tarnished by revelations, such as the release of the Panama Papers and the ensuing Shewan Inquiry. Clean, low-corruption countries, like ours, with light-touch AML\/CFT regulations are attractive havens for money launderers and the movement of illicit funds, says Lynch.<\/p>\n

Figures quoted estimated 2\u20135 per cent of total global GDP (NZ$800 billion – NZ$2 trillion) is being money-laundered yearly, and of that the Ministry of Justice conservatively estimated $1.5 billion NZ made its way to New Zealand. He also quoted other research indicating the real figure as being closer to $10 billion NZ.<\/p>\n

Lynch says, research clearly shows that where there\u2019s money laundering there\u2019s most likely to be other crime too. The top three areas most frequently linked are fraud, narcotics trafficking, and conspiracy and collusion.<\/p>\n

He made the point, shared by everyone concerned, that we need these changes to protect our reputation on an international and national level as well as on an individual firm by firm basis. Nothing exists in isolation. Association is everything. The compliance process helps keep us safe.<\/p>\n

What the Department of Internal Affairs and the police are concerned about<\/span><\/h2>\n

In her session, Kate Reid, Director Phase 2 Implementation, Regulatory Services, Department of Internal Affairs (DIA), outlined what the risks of potential money laundering and financing of terrorism were within the legal sector.<\/p>\n

She said they were moderately high because:<\/p>\n