ANTI-MONEY LAUNDERING AND COUNTER FINANCING TERRORISM (aml/cft)
All law firms have responsibilities to our clients with regard to the new Act that has been passed by the Government. From the 1 July 2018 all Law firms need to comply with the requirements of the Anti-Money Laundering and Countering Financing of Terrorism Act 2009 (AML for short). Lawyers must do a number of things to help combat money laundering and terrorist financing, and to help Police bring the criminals who do it to justice.
The AML law does this because the services Law firms and other professionals offer may be attractive to those involved in criminal activity. All Law firms and other professionals must assess the risk they may face from the actions of money launderers and people who finance terrorism and must identify potentially suspicious activity. To make that assessment, lawyers must obtain and verify information from prospective and existing clients about a range of things. This is part of what the AML calls “customer due diligence”. Once we receive your information we make an assessment to continue to act for you in the matter.
CUSTOMER DUE DILIGENCE REQUIREMENTS
Customer due diligence requires a law firm to undertake certain background checks before providing services to clients (customers). Lawyers must take reasonable steps to make sure the information they receive from clients is correct, and so they need to ask for documents that show this. We will need to obtain and verify certain information from you to meet these legal requirements.
This information includes:
If a Trust, we will need information about the trustees and beneficiaries.
There may be situations where we must ask you for more details about the nature and purpose of the work you are asking us to do. As well, we may have to ask for more information confirming the source of your funds for a transaction
IF YOU CANNOT PROVIDE THE REQUIRED INFORMATION
If we are not able to obtain the required information from you, it is likely we will not be able to act for you. Before we start working for you, we will let you know what information we need, and what documents you need to show us and let us photocopy. Please contact the lawyer who will be undertaking your work if you have any queries or concerns
Law firms now must take steps to assess the risk faced from the actions of money launderers, from people who finance terrorism, and any suspicious activity carried out by those dealing with law firms.
This will also help other countries transact with NZ firms confidently, knowing that money sent into or out of NZ is not tainted by the proceeds of crime. Banks have been complying with the AML legislation since 2013; now it’s the lawyers turn.
It’s important to understand the reason for the legislation and why you will be asked for this additional information.
NEW AND EXISTING CLIENTS
The law applies to everyone and we need to ask for this information even if you have been a client of ours for a long time. Once we have this information from you we may need to update it from time to time as per your circumstances, and the work you ask us to do for you.
Before we start working on a particular matter for you we’ll let you know what information we need. Once these new requirements have been in place for some time they will become familiar and there should be very little inconvenience to you or to us.
If you have any queries, please contact me.
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