Financial Crime World

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New Zealand’s Financial Institution Security Measures Under Scrutiny

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A recent report has assessed New Zealand’s efforts to combat financial crime and terrorism, with mixed results. The country received a rating of “largely compliant” for its implementation of the Financial Action Task Force (FATF) Recommendations.

Strengths

  • Risk assessment procedures were praised by the report.
  • National cooperation and coordination were commended.
  • Measures to confiscate assets related to financial crime were also recognized.
  • The country was praised for targeting terrorist financing and imposing sanctions on individuals and organizations involved in such activities.

Areas for Improvement

Financial Institution Secrecy Laws

  • New Zealand’s financial institution secrecy laws were identified as an area for improvement.
  • Reliance on third-party providers was also highlighted as a concern.
  • The country was found to be partially compliant with regards to targeting proliferation-related activities and imposing sanctions on individuals and organizations involved in such activities.

Progress Made

  • New Zealand has made significant progress in implementing measures to prevent money laundering and terrorist financing.
  • New technologies were introduced, and customer due diligence procedures were enhanced.
  • The country’s efforts to regulate and supervise financial institutions and DNFBPs (designated non-financial businesses and professions) were commended.

Recommendations for Improvement

Preventing Cash Couriers from Being Used for Illegal Activities

  • More effective measures are needed to prevent cash couriers from being used for illegal activities.

Transparency and Beneficial Ownership

  • Improvements are needed in transparency and beneficial ownership of legal persons and arrangements.

Supervisory Powers

  • Enhancements are necessary for the powers of supervisors and law enforcement agencies.

Conclusion

The report’s findings will likely be closely scrutinized by financial regulators and policymakers in New Zealand. To maintain its reputation as a secure and stable financial hub, concrete steps must be taken to address the identified shortcomings.