The New Zealand Police Financial Intelligence Unit has issued a new Suspicious Activity Report guideline, replacing the Suspicious Transaction Reporting Guidelines published in 2013.
The Anti-Money Laundering and Countering Funding of Terrorism Act 2009 requires reporting entities to conduct a risk assessment and establish an AML/CFT programme.
Suspicious activities will need to be reported to the FIU from 1 July 2018.
Businesses introduced under “Phase 2” of the AML/CFT Act 2009 will need to start reporting suspicious activities from the date they must start to comply with the Act. For the legal profession this is 1 July 2018.
The AML/CFT Programme must include adequate and effective policies, procedures and controls for preventing and detecting money laundering and terrorism financing and for reporting suspicious activity to the Financial Intelligence Unit (FIU).
The guidance has three main objectives:
- To explain the basics of money laundering and terrorism financing;
- To help reporting entities identify suspicious activities by providing specific typologies and indicators;
- To help reporting entities comply with Suspicious Activity Reporting (SAR) obligations by specifying when reports must be made, in what circumstances, what details to include, and how to report them.
The guideline says that in many cases reporting entities will be unaware what the underlying criminal activity is. However, by screening transactions and activities for known indicators and typologies, a reasonable suspicion that the transaction or activity is relevant to criminal offending may arise. In these cases a SAR must be submitted to the FIU.