AML/CFT Audits & Compliance Reviews

AML/CFT and New Zealand

In 2019 New Zealand was the least corrupt country alongside Denmark, according to Corruptions Perceptions Index 2019. New Zealanders are very proud to hold this prestigious position.

To tackle money laundering and terrorism financing, the NZ Government made law changes that affect various businesses and professions. Enter the Anti-Money Laundering and Countering Financing of Terrorism Act 2009.

Money laundering is not only the processing of “cleaning” dirty money which was obtained illegally, this also includes money from other crimes such as fraud, tax evasion etc.

I provide services to Phase 2 entities being lawyers, conveyancers, accounting practices and real estate agents.

AML/CFT – Phase 2 entities

The AML/CFT Act has been in force for Phase 2 entities on the following dates (as outlined in Section 6(3)(a)-(c) of the Act):

a) Lawyers and conveyancers on 1 July 2018;

b) Accounting practices on 1 October 2018; and

c) Real estate agents on 1 January 2019.

This only applies to firms who conduct certain “captured activities” and are therefore captured by the AML/CFT Act as a Designated Non-Financial Business or Profession (DNFBP).

As at the date when your firm became a captured activity, you were required to have established and implemented a suitable “Risk Assessment” document, as well as an “AML/CFT Programme” (also known as Compliance Programme”) document. These are two stand-alone documents which are to be treated as living documents which are subject to an external audit as well as internal reviews.

Section 59(2) of the Act requires a firm to have its Risk Assessment and AML/CFT Programme audited every 2 years. (Please note: the audit timeframe will be changing to every 3 years for Phase 2 entities – read about it here).

AML/CFT Audit

If you have not yet organised your firm’s AML/CFT audit, please get hold of me today for a discussion on the processes and timeframe. I will provide you with an outline of the process and what is involved.

On-site audit

I will review your firm’s AML/CFT documents prior to visiting the firm. Client’s will be selected with the list provided to you for what client due diligence (CDD) I will be reviewing.

You / staff will not need to set days aside to facilitate the audit. I work around your time-frame and ensure that the audit runs smoothly with minimal disruptions to your workflow. I do require at least one hour to be set aside for a debriefing meeting with the Money Laundering Compliance Officer (MLCO) and Money Laundering Reporting Officer (MLRO) (if you have one).

On completion of the site visit, I will issue you with an AML/CFT Audit Report and Management Letter within a week of completion of the audit.

Remote desk-based audit

A desk-based review runs similar to an on-site audit only that discussions are held either over the phone or through other means example Zoom, Skype etc.

With a desk based review, more work is required from your or someone in your office to make available the CDD documents for the client’s I have selected to test. I can either be given access to your accounting software or log in remotely to your server, or documents can be sent by email or shared in Dropbox.

AML/CFT reviews and training

Post external audit

I am able to provide post-audit assistance with implementing changes according to the AML/CFT Audit Report and Management Letter issued by your independent auditor.

DIA review report

If the Department of Internal Affairs (DIA) has audited your firm and issued your firm with a Review Report outlining the non-compliance issues, I am able to assist with bringing your firm in line to meet the compliance with the relevant sections of the AML/CFT Act.

Interim compliance audits/reviews

Should your firm require an interim audit/review, I would gladly tailor a review to suit your firm’s needs. You may only require a review of the CDD documents collated by staff / authors or a review of new AML/CFT documents and internal controls that your firm has implemented.

Training

Should you or your employees require assistance with AML/CFT related issues; or you have a new employee who has started with the firm, I will gladly assist with AML/CFT related training.

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