Coates BarryBARRY COATES (Green): Tēnā koe e Te Māngai. I rise to speak in the final reading of the Anti-Money Laundering and Countering Financing of Terrorism Amendment Bill. I want to first start by saying why this bill is important. I think this is actually one of the most important bills that we have had through Parliament in the time that I have been here since last October. I think this bill has been far too long in coming. We have to remind ourselves that money-laundering is about how criminals hide their money. It is about ways in which illicit money can be washed clean. The police in 2013 estimated that the annual amount of money-laundering going on is $1.6 billion but actually they did not really know and they themselves had put the estimates at orders of magnitude higher.We need to remind ourselves that the money comes from profits from crime. That means there are real people at the end of this crime. There are people who have been hooked into P and other addictive drugs. There are victims of extortion and organised crime—women and children have been forced into the sex trade. There have been arms dealers and corrupt officials. These are some of the people who are hurt by crimes whose profits end up being laundered in our country. We need to remind ourselves of the human cost of money-laundering.We have also heard from the police that more than half of the money-laundering goes into real estate. What does that mean? Well there are examples of foreign buyers coming into New Zealand viewing 50 houses and buying 40. The amount of money-laundering that has gone into real estate has fuelled our housing bubble and has meant that younger New Zealanders cannot afford to get on to the property ownership ladder. It has distorted our property market because we have not had adequate controls and the lack of proper legislation has created a financial subsector that feeds off dirty money.So legislation has obviously been required. The question is why it has taken so long. The UK has had similar legislation since 2007. The Financial Action Task Force on Money Laundering did an evaluation of New Zealand in 2009. It found 197 cases of money-laundering for fraud drugs theft blackmail and burglary. As a result of its report New Zealand was struck off the EU's white list of countries that could be trusted on money-laundering and that added to the cost of doing business for New Zealand companies. The Financial Times called us a soft touch for money-laundering.This Government when it came into office promised action. Officials however subsequently said that work was deferred due to other priorities. It was only after pressure from the Greens Labour researchers and across the business sector that we started to get some recognition that this legislation needed to be brought forward and then this Shewan report recommended that the legislation be introduced by the end of 2016. Finally we have legislation before us in this House produced at breakneck speed in the last sessions of Parliament before the end of the session.The Green Party supports this legislation. We have been deeply involved in its formulation. We have engaged closely in the select committee process and have welcomed the constructive process of the chair Kanwaljit Singh Bakshi and his Law and Order Committee colleagues. I think it has been a constructive process and I think that through processes such as this we have seen the committee acting to reduce compliance costs and make more effective legislation. We have some concerns still about the bill however. Submitters called for three key elements to be included in this bill. They in our view were not fully included. The first was that submitters called for the information to be supported by a public register of beneficial owners. Now this means that the people who had put their money into foreign trusts in New Zealand—the 11000 foreign trusts that were registered at the time that the Panama Papers broke open this story—would have had to have gone on to a public register showing beneficial ownership. In the end the Government stopped short of that register. It provided a far less onerous requirement that instead only names and addresses would be required without beneficial owners.As a result of even these weak rules most of the trusts then did not reregister—3000 of the 11000 trusts were prepared to give this basic information. That says to us that any assurances that the Government gave that the foreign trust business was entirely legitimate were not correct—that actually it turns out that most of those trusts were in New Zealand because of the secrecy provisions on foreign trusts. We want to see a public register of beneficial ownership applied to businesses and trusts in New Zealand. This is a policy that the UK and many other countries internationally have adopted. We regard it as good practice in terms of countering money-laundering.A second recommendation was to ensure that there was proper reporting on enforcement. One of the key areas of enforcement is the link between money-laundering and gambling. We have seen the case of William Yan—a generous political donor by the way. This year the High Court ordered William Yan to return $42 million from alleged illegal activity that had been laundered in New Zealand. His network and other networks of criminals had been based at Skycity. William Yan gambled $293 million in Skycity. Skycity made $23 million profit from that. However that money was not returned to the public. What we see is the incentives for some money-launderers to keep using the institutions that allow them to undertake their money-laundering and those very institutions themselves have a financial incentive to allow that activity to continue. Breaking that cycle is absolutely crucial and we do not believe this legislation goes far enough in breaking that cycle. I think the third area that we need is we need additional resources in order to be able to implement this legislation properly and that was a point made by several submitters. The submitters said that it is not enough to just have the legislation—[Interruption]The ASSISTANT SPEAKER (Hon Trevor Mallard): Sorry I forgot to give the member the call—I was so enthralled. The member has only a minute.BARRY COATES: Thank you. It is not enough to have the legislation; you need to have the proper enforcement. What we have seen in New Zealand is that there has been far more emphasis on the $40 million of welfare fraud than the $4 billion of white-collar crime—that 1 in 20 welfare beneficiaries is investigated whereas 1 in 10000 taxpayers is investigated for fraud. What we see is that 67 percent of the welfare fraudsters go to prison while 18 percent of white-collar criminals do.We have a punitive welfare system and a permissive white-collar crime system. We need to change this. We need to get much more serious about the dirty money in our economy. The Greens would change this. We would supplement this bill with proper action to clean up money in our country and have productive investment and a productive economy for the benefit of all.The ASSISTANT SPEAKER (Hon Trevor Mallard): The member's time has expired. Before I call Fletcher Tabuteau—I was involved in a slight interchange with Jonathan Young and the Hon Ruth Dyson earlier with regards to forms of address in the Chamber. I will refer them to page 224 of McGee and in particular a paragraph headed Debate in the House is a discussion among the members of the House present in the Chamber." It goes on to say "Members should address the Chair not the 'listener'." I would assume that that now means the listener and the viewer. So I think I am probably the only member of the House who addresses the listener and certainly not from within the House."