AML/CFT compliance templates
On 1 July 2018, lawyers and conveyancers will become reporting entities under the Anti-Money Laundering and Countering Financing of Terrorism (AML/CFT) Act 2009. The purpose of the AML/CFT regime reflects New Zealand’s commitment to the international initiative to counter the impact that criminal activity has on people and economies within the global community.
Lawyers who undertake specified activities (‘captured activities’) will need to ensure they have a programme in place to meet AML/CFT requirements. Captured activities are identified as services which are potentially attractive to criminals as a means of laundering money or financing criminal activity. The AML/CFT compliance regime adopts a risk-based approach.
To meet AML/CFT requirements, lawyers need to :
- Appoint a Compliance Officer
- Undertake a risk assessment of their business. This will enable lawyers to identify the risk of money laundering in different aspects of their practice. The level of risk identified will determine the particular compliance steps a lawyer must take in relation to a particular client matter.
- Prepare a compliance programme which includes internal procedures, policies and controls to detect and manage the risks of ML/CFT
- Ensure they know their clients by undertaking customer due diligence (CDD). This includes verifying the identity of their clients and in some cases the sources of client wealth or funding for a transaction. It also includes on-going account monitoring
- Report suspicious activity through filing a Suspicious Activity Report (SAR) with the Police’s Financial Intelligence Unit (FIU).
- Submit an annual report to the DIA which is the AML/CFT supervisor for the legal profession.
- Arrange a bi-annual independent audit of the firm’s AML/CFT compliance programme.
- Establish a recording keeping system.
New Zealand Law Society resources
The Law Society has produced a bundle of resources about AML/CFT to assist lawyers with these compliance requirements. The following sample documents are available for law firms to adapt:
Department of Internal Affairs guide
The Department of Internal Affairs has produced a useful guide ‘Guideline Lawyers and Conveyancers - Complying with the Anti-Money Laundering and Countering Financing of Terrorism Act 2009’ which is available on their website. The sample documents referred to above are designed to complement that Guideline.
Law Society Practice Briefings
Practice Briefings provide guidance on issues related to privilege and confidentiality, suspicious activities and continuing to act:
- A guide to advising your clients on why you need to ask for more information relating to the AML/CFT requirements. (This can be adapted for your firm)
- Privilege, confidentiality and reporting suspicious activities
- Continuing to act after filing suspicious activity reports
- Suspicious transactions and activities
The Law Society will keep lawyers updated on AML/CFT developments via LawPoints and LawTalk.
Last updated on the 8th February 2018