Financial Crime World

New Zealand’s Regulatory Bodies for Financial Crime Receive Overhaul in Latest FATF Report

The Financial Action Task Force (FATF) has released its latest follow-up report on New Zealand’s efforts to combat financial crime. The comprehensive assessment highlights areas where the country has made significant progress and identifies key areas that require further improvement.

Progress and Compliance

New Zealand has made notable strides in implementing measures to prevent money laundering, terrorist financing, and other forms of financial crime. According to the report, the country is largely compliant (LC) in many areas, including:

  • Risk Assessment: New Zealand’s risk assessment mechanisms are effective.
  • Customer Due Diligence: The country has implemented robust customer due diligence measures.
  • Record Keeping: New Zealand’s record-keeping requirements are adequate.

The report also notes that the country’s national cooperation and coordination mechanisms were deemed to be effective (C).

Areas for Improvement

While New Zealand has made significant progress, there are still some areas that require attention from regulatory bodies. These include:

  • Financial Institution Secrecy Laws: The FATF recommends reviewing these laws to ensure they do not hinder efforts to combat financial crime.
  • Targeted Financial Sanctions: While New Zealand has implemented targeted financial sanctions related to terrorism and terrorist financing, there is still room for improvement in terms of transparency and beneficial ownership of legal persons (PC).
  • Regulation and Supervision of Financial Institutions: The FATF recommends improving the regulation and supervision of financial institutions (PC) and DNFBPs (non-bank financial businesses and professions).

Recommendations

The FATF has made several recommendations to New Zealand, including:

  • Strengthen Regulatory Framework: Improve the regulation and supervision of financial institutions and DNFBPs.
  • International Cooperation: Enhance mutual legal assistance (LC) and extradition procedures to combat financial crime.
  • Transparency and Beneficial Ownership: Increase transparency and improve beneficial ownership requirements for legal persons.

Conclusion

While there are areas where New Zealand can improve, the country’s regulatory bodies have made significant progress in implementing measures to combat financial crime. By addressing the recommendations outlined in the FATF report, New Zealand can further strengthen its efforts to prevent and detect financial crime.