Improvement of New Zealand's anti-money laundering regime has been on the agenda since the intergovernmental Financial Action Task Force (FATF) reviewed the existing financial transactions reporting regime in 2003, and identified a significant number of areas for improvement.
Five years, and three discussion papers later, the Ministry of Justice released a draft 'Anti-Money Laundering and Countering Financing of Terrorism' Bill (AML Bill) for public consultation in September. The stated aim is to introduce an effective, low-cost regime that allows New Zealand to meet its international obligations.
Key features of the AML Bill can be found in our October Update.
The first round of submissions closed only three weeks after the AML Bill was released and the Ministry is currently undertaking its initial review of the AML Bill. Detailed Cabinet policy decisions are expected to be released in February 2009, along with a summary report on submissions. The Ministry's aim is to have the AML Bill introduced to Parliament around April 2009 - coinciding with the FATF's next planned visit to New Zealand to assess progress. The change in government is unlikely to delay the progress of the legislation.
There will be a further opportunity for the public to make submissions as part of the usual select committee process, so those who were caught out by the brevity of the initial consultation period will still have an opportunity to contribute.
We are closely watching several aspects of the development of the AML Bill and the regulatory regime it will herald. These include the treatment of financial service providers who provide products and services falling into several categories (who may be subject to scrutiny by several of the AML supervisors), of trans-Tasman financial service providers (who will be subject to supervision by the Australian regulator AUSTRAC, as well as by the New Zealand supervisors) and of term life insurance (for which the definitions are currently far from clear). Please contact us if you have an interest in any of these or other aspects of the AML Bill.
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