All New Zealand banks have introduced enhanced customer identification requirements.
The Anti-Money Laundering and Countering Financing of Terrorism Act 2009 is designed to help detect and deter money laundering and terrorism financing.
Under the law all banks in New Zealand are required to do more to verify a customer’s identity and, in some cases, account activity.
This will help protect New Zealand from financial crime, improve our financial reputation overseas, and meet our international obligations.
The law means all banks need to collect specific information from customers to verify their identity and address. The same goes for those acting on behalf of customers.
The law builds on previous customer identification requirements. Customers may need to provide more information about themselves than they have in the past.
From time to time, banks will need to ask existing customers if that information is still up to date.
Banks may also need to ask customers for additional information if their account activity changes over time and ask how customers intend to use their products and services.
Collecting and verifying this customer information may take a little more time than it has in the past.
Although banks and financial institutions operating in New Zealand will apply the same set of rules to customer accounts, some customers may experience slight process differences between each bank.
Customers are primarily affected when they open bank accounts, or if they want someone else to have signing authority on their account.
Customers may also be affected when sending, receiving or transferring funds.
A number of serious crimes drive money laundering activity around the world. These include drug trafficking, fraud, robbery, illegal prostitution and gambling, arms trafficking, bribery and corruption.
Money laundering is the process of disguising the illegal origin of criminal profits.
Criminals use a range of methods and levels of sophistication to make money obtained from their criminal activities appear legitimate.
Terrorist groups also move funds to disguise their source, purpose and destination. Terrorism financing includes funding terrorist acts and organisations.
The Anti-Money Laundering and Countering Financing of Terrorism Act requires banks to:
All banks were required to comply with the Anti-Money Laundering and Countering Financing of Terrorism Act by 30 June 2013.
Customers should contact their bank in the first instance if they have any concerns about these requirements. The Banking Ombudsman can investigate further, if necessary.
Banks are able to answer questions about how the law affects their customers.
Information about the Anti-Money Laundering and Countering Financing of Terrorism Act is also available from the Ministry of Justice, which administers the act.