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Dirty laundry!

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Ben Coleman
01-Jul-2018
Commercial Law, Law Changes, People, Property Law

We want to advise you of law changes that will apply to lawyers and their clients from 1 July 2018.  These laws already apply to banks and financial service providers; and are known as AML (Anti-Money Laundering and Countering Financing of Terrorism Act 2009, to be precise).

AML has been in place in New Zealand since 2013 and in addition to applying to your relationship with us from 1 July, will apply to your relationship with your accountant from 1 October 2018 and any Real Estate Agent you deal with after 1 January 2019. 

Why this, why now?

AML is a global initiative with responsible countries agreeing to adopt AML systems that include practical measures to make it harder for criminals to profit from and fund illegal activity; and to restrict the flow of money to terrorist organisations.

The Government has chosen to roll this out in stages, now being the time for lawyers and conveyancers to join the regime.

Some criminals try to use lawyers to help hold and move assets. Introducing AML measures will deter criminals from using our services and help us detect them if they do.

In implementing AML we are doing our bit to safeguard and help New Zealand live up to its reputation as one of the least corrupt countries in the world and a good place to do business.

What this will mean for you as our client

The law requires us to 'know our clients' and to collect and verify information to show that we know our client is who they say they are.

Your first thought might be "but I have been dealing with Dean & Associates for years and you already know all about me!"

Whilst we may know a lot about you already, AML includes a set of rules that prescribe what we must do to complete 'customer due diligence' (CDD).  This includes collecting specific information from you, holding proof of ID and verification of your physical address.  In certain circumstances we will also be required to obtain evidence of your source of wealth or the source of funds used to settle a transaction.

At its simplest, this will be nothing more that sighting your passport and a document such as a bank statement, rate demand or utility bill addressed to your usual residential address and holding a copy of these on our file for audit purposes.

For overseas clients, companies and trusts we will need more information and will let you know what we require at the time we request it from you.

We may hold existing information that satisfies some of our customer due diligence requirements and where we do, we will only request the documentation we need to complete the process.

For existing clients, we will update our CDD information next time we receive an instruction from you or when your circumstances change.

For new clients, we will need to complete CDD before we act on your instruction and will incorporate this into our new client engagement process.

Our team will try and make this as easy for you as we can.  However, we will need your co-operation and timely response to any request for information.

It is important to understand that under AML, we are unable to continue to work with you if we cannot complete our required CDD.  Clearly neither of us wants to find ourselves in this situation.

For more information on AML please check out our website or contact our AML Compliance Officer: office@deanlaw.co.nz