Anti-money Laundering and Accountants

Anti-money Laundering and Accountants

Anti-money Laundering and Accountants

Anti-Money Laundering legislation will impact Accountants from 1 October this year.

What is Money Laundering?

We have reprinted the information from the Department of Internal Affairs in italics below.

Money laundering is the method by which people disguise and conceal the proceeds of crime and protect and enjoy their assets.

Some people in New Zealand may also be financing the activities of terrorists and known terrorist organisations. 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.

People with criminal intentions value anonymity and are looking for ways to distance themselves from their activities while still enjoying the proceeds of their crime. Both domestic and international evidence suggests that using gatekeepers, such as accountants, is a way for criminals to create a false perception of legitimately acquired wealth.

The recent changes to the Anti-Money Laundering and Countering Financing of Terrorism Act 2009 (the AML/CFT Act or the Act) include accountants. 

Why are Accountants Included in the Legislation?

Using accounting professionals is attractive to some criminals because these professionals are required for the completion of certain kinds of transactions and because their specialist skills can be misused to assist the laundering of criminal proceeds or funding terrorism. Accountants can add respectability and a veneer of legitimacy to transactions.

What are clients likely to notice?

The AML/CFT Act requires us to know who our clients are (as well as who any beneficial owners behalf of your client are) by conducting customer due diligence (CDD) to the level required before you conduct a captured activity or establish a business relationship.

This may mean requesting identity information from existing clients. We stress ‘may’, not ‘will’.

Existing clients should not be impacted unless the nature of the business we conduct with them changes or we become aware of a suspicious activity.

Under the legislation, it is a requirement that accountants report suspicious transactions to the Police.

We hope that the impact felt by our existing clients will be very minor. If identification is requested, your passport or driver’s licence should suffice. We apologise for any inconvenience in advance. Confirming identity is now a statutory requirement that we must comply with.

 

Angus is the CEO and founder of Generate Accounting.