Dean Jacqui: Anti-Money Laundering and Countering Financing of Terrorism Bill — Third Reading 
Dean Jacqui: Anti-Money Laundering and Countering Financing of Terrorism Bill — Third Reading 
[Volume:658;Page:7107] 
JACQUI DEAN (National—Waitaki) 
: 
 The purpose of the Anti-Money Laundering and Countering Financing of Terrorism Bill is very clear. It is to bring New Zealand into line with the international standards for the framework of anti - money-laundering and countering financing of terrorism. These standards are set out by the Financial Action Task Force on Money Laundering of which New Zealand is a member. The purpose of the Financial Action Task Force on Money Laundering is to develop and promote national and international policy around prevention of money-laundering and the financing of terrorism. This bill is designed to enhance New Zealand’s anti - money-laundering and countering financing of terrorism legislation and is to be in line with recommendations from the Financial Action Task Force on Money Laundering. 
The bill is forward-looking. It recognises that the financial sector is one of rapid technological change. It is as far as is practicable harmonised with Australian legislation. It is risk-based rather than being overly prescriptive and that is to minimise compliance costs for banks and financial institutions but also importantly to maintain smooth business relationships between say a bank and its customers. 
A risk-based approach will enable financial institutions to focus resources on areas of higher risk with varying levels of customer due diligence or checking if you like. It will depend on whether there is an existing relationship with the customer whether there has been a material change in the nature or purpose of the business relationship whether the customer is a trust or another vehicle for holding personal assets or whether it is an overseas customer. In terms of risk there is a world of difference between the financial transactions undertaken by my lovely elderly mother-in-law and a non-resident customer from a country that has minimal anti - money-laundering measures in place. Customer due diligence provisions recognise these varying levels of risk of money-laundering on behalf of their customers. 
Reporting entities banks and financial institutions will be required to develop anti - money-laundering programmes and to report to one or more of four supervisors. Those supervisors are at the moment the Reserve Bank the Securities Commission the Police and the Department of Internal Affairs in the case of casinos. Those supervising entities will be required to develop a regime for the supervision of the monitoring and enforcement of its anti - money-laundering and countering financing of terrorism obligations under this legislation. Given the strength of New Zealand’s existing financial monitoring systems we recommended against requiring the application of the Financial Action Task Force on Money Laundering definition of politically exposed persons to New Zealand nationals living within New Zealand. However enhanced scrutiny will be applied to foreign politically exposed persons conducting transactions within the New Zealand financial sector. 
The main object of this bill is to detect and to deter money-laundering and the financing of terrorism. Measures in the bill are designed to facilitate cooperation between reporting entities anti - money-laundering and countering financing of terrorism supervisors law enforcement and regulatory agencies. This bill achieves those objectives and with thanks to committee members banking representatives and officials I recommend this bill to the House.