In this subpart, unless the context otherwise requires,—

(1) A reporting entity must conduct customer due diligence on—

• (a) a customer:

• (b) any beneficial owner of a customer:

• (c) any person acting on behalf of a customer.

(2) For the purposes of subsection (1)(b), a customer who is an individual and who the reporting entity believes on reasonable grounds is not acting on behalf of another person is to be treated as if he or she were also the beneficial owner unless the reporting entity has reasonable grounds to suspect that that customer is not the beneficial owner.

(3) The type of customer due diligence that must be conducted by a reporting entity is,—

• (a) in the circumstances described in section 12, at least standard customer due diligence:

• (b) in the circumstances described in section 16, at least simplified customer due diligence:

• (c) in the circumstances described in section 20, enhanced customer due diligence.

(4) A reporting entity that is required to conduct customer due diligence in the circumstances described in sections 12, 16, and 20 is not required to obtain or verify any documents, data, or information that it has previously obtained and verified for the purposes of carrying out customer due diligence in accordance with this Act, unless there are reasonable grounds for the reporting entity to doubt the adequacy or veracity of the documents, data, or information previously obtained.

(5) Nothing in subsection (4) affects the obligation to conduct ongoing customer due diligence in accordance with section 28.

When establishing the level of risk involved for the purposes of this subpart, a reporting entity must rely on its AML/CFT programme and its risk assessment undertaken in accordance with section 55.

Verification of identity must be done on—

• (a) the basis of documents, data, or information issued by a reliable and independent source; or

• (b) any other basis applying to a specified situation, customer, product, service, business relationship, or transaction prescribed by regulations.

A reporting entity must conduct standard customer due diligence in the following circumstances:

• (a) if the reporting entity establishes a business relationship with a new customer:

• (b) if a customer seeks to conduct an occasional transaction through the reporting entity:

• (e) if, in relation to an existing customer, and according to the level of risk involved,—

  • (i) there has been a material change in the nature or purpose of the business relationship; and

  • (iv) the reporting entity considers that it has insufficient information about the customer:

• (f) any other circumstances specified in regulations.

A reporting entity must obtain the following identity information in relation to the persons referred to in section 9(1):

• (a) the person's full name; and

• (b) the person's date of birth; and

• (c) if the person is not the customer, the person's relationship to the customer; and

• (d) the person's address or registered office; and

• (e) the person's company identifier or registration number; and

• (f) any information prescribed by regulations.

(1) A reporting entity must—

• (a) take reasonable steps to satisfy itself that the information provided under section 13 is correct; and

• (b) according to the level of risk involved, take reasonable steps to verify any beneficial owner's identity so that the reporting entity is satisfied that it knows who the beneficial owner is; and

• (c) if a person is acting on behalf of the customer, according to the level of risk involved, take reasonable steps to verify the person's identity and authority to act on behalf of the customer so that the reporting entity is satisfied it knows who the person is and that the person has authority to act on behalf of the customer; and

• (d) verify any other information prescribed by regulations.

(2) Except as provided in subsection (3), a reporting entity must carry out verification of identity before establishing a business relationship or conducting an occasional transaction.

(3) Verification of identity may be completed after the business relationship has been established if—

• (a) it is essential not to interrupt normal business practice; and

• (b) money laundering and financing of terrorism risks are effectively managed through procedures of transaction limitations and account monitoring; and

• (c) verification of identity is completed as soon as is practicable once the business relationship has been established.

A reporting entity must also obtain—

• (a) information on the nature and purpose of the proposed business relationship between the customer and the reporting entity; and

• (b) sufficient information to determine whether the customer should be subject to enhanced customer due diligence.

(1A) A reporting entity may conduct simplified customer due diligence if—

• (a) it establishes a business relationship with one of the customers specified in subsection (1B); or

• (b) one of the customers specified in subsection (1B) conducts an occasional transaction through the reporting entity; or

• (c) a customer conducts a transaction or provides a product or service specified in regulations through the reporting entity.

(1B) The following are customers for the purposes of subsection (1A):

• (a) a company that is listed on an exchange registered under Part 2B of the Securities Markets Act 1988:

• (b) a government department named in Schedule 1 of the State Sector Act 1988:

• (c) a local authority as defined in section 5 of the Local Government Act 2002:

• (d) the New Zealand Police:

• (e) the New Zealand Security Intelligence Service:

• (f) any other entity or class of entities specified in regulations.

(2) A reporting entity may also conduct simplified customer due diligence on a person who purports to act on behalf of a customer when—

• (a) the reporting entity already has a business relationship with the customer at the time the person acts on behalf of the customer; and

• (b) the reporting entity has conducted one of the specified types of customer due diligence on the customer in accordance with this Act and regulations (if any).

(3) For the avoidance of doubt, nothing in this subpart requires identification or verification of identity of a beneficial owner of a customer in respect of whom a reporting entity may conduct simplified customer due diligence.

A reporting entity must obtain the following identity information in relation to a person acting on behalf of the customer:

• (a) the person's full name; and

• (b) the person's date of birth; and

• (c) the person's relationship to the customer; and

• (d) any information prescribed by regulations.

(1) A reporting entity must, according to the level of risk involved, verify the identity of a person acting on behalf of a customer and that person's authority to act for the customer so that it is satisfied it knows who the person is and that the person has authority to act on behalf of the customer.

(2) Verification of identity must be carried out before the business relationship is established or the occasional transaction is conducted or the person acts on behalf of the customer.

(3) For the purposes of verifying a person's authority to act in the circumstances described in section 16, a reporting entity may rely on an authority provided in an application form or other document provided to the reporting entity that shows a person's authority to act or transact on an account.

In the circumstances described in section 16(1A)(a), a reporting entity must also obtain information on the nature and purpose of the proposed business relationship between the customer and the reporting entity.

(1) A reporting entity must conduct enhanced customer due diligence in accordance with sections 21 and 22 in the following circumstances:

• (aa) if the reporting entity establishes a business relationship with a customer that is—

  • (i) a trust or another vehicle for holding personal assets:

  • (ii) a non-resident customer from a country that has insufficient anti-money laundering and countering financing of terrorism systems or measures in place:

  • (iii) a company with nominee shareholders or shares in bearer form:

• (ab) if customer seeks to conduct an occasional transaction through the reporting entity and that customer is—

  • (i) a trust or another vehicle for holding personal assets:

  • (ii) a non-resident customer from a country that has insufficient anti-money laundering and countering financing of terrorism systems or measures in place:

  • (iii) a company with nominee shareholders or shares in bearer form:

• (b) if a customer seeks to conduct, through the reporting entity, a complex, unusually large transaction or unusual pattern of transactions that have no apparent or visible economic or lawful purpose:

• (c) when a reporting entity considers that the level of risk involved is such that enhanced due diligence should apply to a particular situation:

• (d) any other circumstances specified in regulations.

(2) A reporting entity must conduct enhanced customer due diligence in accordance with section 23 if—

• (a) it establishes a business relationship with a customer who it has determined is a politically exposed person; or

• (b) a customer who it has determined is a politically exposed person seeks to conduct an occasional transaction through the reporting entity.

(3) A reporting entity must conduct enhanced customer due diligence in accordance with sections 24 and 25 if it is an ordering institution, an intermediary institution, or a beneficiary institution in relation to a wire transfer.

(4) A reporting entity must conduct enhanced customer due diligence in accordance with section 26 if it has, or proposes to have, a correspondent banking relationship.

(5) A reporting entity must conduct enhanced due diligence in accordance with section 27 if—

• (a) it establishes a business relationship with a customer that involves new or developing technologies, or new or developing products, that might favour anonymity; or

• (b) a customer seeks to conduct an occasional transaction through the reporting entity that involves new or developing technologies, or new or developing products, that might favour anonymity.

A reporting entity must, in relation to a person referred to in section 9(1), obtain the information required under section 13 and the following additional information:

• (a) information relating to the source of the funds or the wealth of the customer; and

• (b) any additional information prescribed by regulations.

(1) A reporting entity must—

• (a) conduct the verification of identity requirements for standard customer due diligence set out in section 14; and

• (b) according to the level of risk involved, take reasonable steps to verify the information obtained under section 21(a); and

• (c) verify any other information prescribed by regulations.

(2) Except as provided in subsection (3), a reporting entity must carry out verification of identity before establishing a business relationship or conducting an occasional transaction.

(3) Verification of identity may be completed after the business relationship has been established if—

• (a) it is essential not to interrupt normal business practice; and

• (b) money laundering and financing of terrorism risks are effectively managed through procedures of transaction limitations and account monitoring; and

• (c) verification of identity is completed as soon as is practicable once the business relationship has been established.

In the circumstances described in section 20(1)(aa), 20(2)(a), and 20(5)(a), a reporting entity must also obtain information on the nature and purpose of the proposed business relationship between the customer and the reporting entity.

(1) The reporting entity must, as soon as practicable after establishing a business relationship or conducting an occasional transaction, take reasonable steps to determine whether the customer or any beneficial owner is a politically exposed person.

(2) If a reporting entity determines that a customer or beneficial owner with whom it has established a business relationship is a politically exposed person, then—

• (a) the reporting entity must have senior management approval for continuing the business relationship; and

• (b) the reporting entity must obtain information about the source of wealth or funds of the customer or beneficial owner and take reasonable steps to verify the source of that wealth or those funds.

(3) If a reporting entity determines that a customer or beneficial owner with whom it has conducted an occasional transaction is a politically exposed person, then the reporting entity must, as soon as practicable after conducting that transaction, take reasonable steps to obtain information about the source of wealth or funds of the customer or beneficial owner and verify the source of that wealth or those funds.

(1) A reporting entity that is an ordering institution must identify the originator of a wire transfer that is over the applicable threshold value by obtaining the following information:

• (a) the originator's full name; and

• (b) the originator's account number or other identifying information that may be prescribed and allows the transaction to be traced back to the originator; and

• (c) one of the following:

  • (i) the originator's address:

  • (ii) the originator's national identity number:

  • (iii) the originator's customer identification number:

  • (iv) the originator's place and date of birth; and

• (d) any information prescribed by regulations.

(2) However, if the wire transfer is a domestic wire transfer, a reporting entity that is an ordering institution may identify the originator by obtaining the originator's account number or other identifying information that may be prescribed and allows the transaction to be traced back to the originator if the reporting entity that is the ordering institution is able to provide the information specified in subsection (1)(a) and (c) to (e) within 3 working days of a request being made by the beneficiary institution.

(3) Regulations may be made under section 148(1)(ac) exempting the reporting entity from the obligation to obtain some or all of the information set out in subsection (1) in relation to a specified transfer or transaction.

(4) The information obtained by the reporting entity (the ordering institution under subsection (1) or (2), as the case may be) must accompany the wire transfer.

(5) A reporting entity that is a beneficiary institution must—

• (a) use effective risk-based procedures for handling wire transfers that are not accompanied by all the information specified in subsection (1); and

• (b) consider whether the wire transfers constitute a suspicious transaction.

(6) Any information obtained by a reporting entity that is an intermediary institution must be maintained by that reporting entity with the wire transfer accompanying the information.

(7) For the purposes of this section, a domestic wire transfer is a wire transfer where the ordering institution, the intermediary institution, and the beneficiary institution are all in New Zealand.

(1) The ordering institution must, according to the level of risk involved,—

• (a) verify the originator's identity so that the reporting entity is satisfied that the information provided under section 24 is current and correct; and

• (b) verify any other information prescribed by regulations.

(2) Verification of the originator's identity must be carried out before the wire transfer is ordered.

(1) A financial institution (the correspondent) that has, or proposes to have, a correspondent banking relationship with a respondent financial institution (the respondent) must, according to the level of risk involved, conduct enhanced customer due diligence as set out in subsection (2) in relation to correspondent accounts that are used, or are proposed to be used, for payments to, or receipts from, foreign financial institutions.

(2) The correspondent must—

• (a) gather enough information about the respondent to understand fully the nature of the respondent’s business; and

• (b) determine from publicly available information the reputation of the respondent and whether and to what extent the respondent is supervised for AML/CFT purposes, including whether the respondent has been subject to a money laundering or financing of terrorism investigation or regulatory action; and

• (c) assess the respondent’s anti-money laundering and countering financing of terrorism controls to ascertain that those controls are adequate and effective; and

• (d) have approval from its senior management before establishing a new correspondent banking relationship; and

• (e) document the respective AML/CFT responsibilities of the correspondent and the respondent; and

• (f) be satisfied that, in respect of those of the respondent’s customers who have direct access to accounts of the correspondent, the respondent―

  • (i) has verified the identity of, and conducts ongoing monitoring in respect of, those customers; and

  • (ii) is able to provide to the correspondent, on request, the documents, data, or information obtained when conducting the relevant customer due diligence and ongoing customer due diligence; and

• (g) meet any other requirements prescribed by regulations and that apply to correspondent banking relationships.

(3) For the purposes of this Act, a correspondent banking relationship means a relationship that involves the provision of banking services by a financial institution (the correspondent) to another financial institution (the respondent) if—

• (a) the correspondent carries on an activity or business at or through a permanent establishment of the correspondent in a particular country; and

• (b) the respondent carries on an activity or business at or through a permanent establishment of the respondent in another country; and

• (c) the correspondent banking relationship relates, in whole or in part, to those permanent establishments; and

• (d) the relationship is not of a kind specified in regulations; and

• (e) the banking services are not of a kind specified in regulations.

Before a reporting entity establishes a business relationship or conducts an occasional transaction that involves new or developing technologies, or new or developing products, that might favour anonymity, the reporting entity must, in addition to the requirements in sections 13 and 14,—

• (a) take any additional measures that may be needed to mitigate and manage the risk of new or developing technologies, or new or developing products, that might favour anonymity from being used in the commission of a money laundering offence or for the financing of terrorism; and

• (b) meet any other requirements prescribed by regulations and that apply to the particular technology or product.

(1) This section applies to a business relationship between a reporting entity and a customer.

(2) A reporting entity must conduct ongoing customer due diligence and undertake account monitoring in order to—

• (a) ensure that the business relationship and the transactions relating to that business relationship are consistent with the reporting entity’s knowledge about the customer and the customer’s business and risk profile; and

• (b) identify any grounds for reporting a suspicious transaction under section 37(1)(b).

(3) When conducting ongoing customer due diligence and undertaking account monitoring, the reporting entity must have regard to—

• (a) the type of customer due diligence conducted when the business relationship with the customer was established; and

• (b) the level of risk involved.

(4) When conducting ongoing customer due diligence and undertaking account monitoring, a reporting entity must do at least the following:

• (a) regularly review the customer's account activity and transaction behaviour; and

• (b) regularly review any customer information obtained under sections 13, 15, 17, 19, 21, 22A, 23, 24, 26, and 27, or, in relation to an existing customer, any customer information the reporting entity holds about the customer; and

• (c) anything prescribed by regulations.

(1) A reporting entity (member A) that is a member of a designated business group may—

• (a) rely on another member of the group (member B) to conduct any customer due diligence procedures required for customer due diligence under this Act or regulations as long as—

  • (i) any identity information is given to member A by member B before member A establishes a business relationship or an occasional transaction is conducted; and

  • (ii) any verification information is given to member A by member B as soon as practicable, but no later than 5 working days, after the business relationship is established or the occasional transaction is conducted:

• (b) adopt that part of an AML/CFT programme of another member of the group that relates to record keeping, account monitoring, ongoing customer due diligence, and annual reporting and share and use the procedures, policies, and controls relating to those parts of the programme subject to any conditions prescribed by regulations:

• (c) use another member of the group's risk assessment if that risk assessment is relevant to member A's business:

• (d) make a suspicious transaction report on behalf of any other member or all members of the designated business group.

(1A) Despite subsection (1), a reporting entity, and not the member of the designated business group relied on by the reporting entity, is responsible for ensuring that it is complying with this Act and regulations.

(1B) An AML/CFT supervisor for a reporting entity that is part of a designated business group may require the reporting entity to undertake its own risk assessment or develop its own AML/CFT programme if the AML/CFT supervisor is of the view that the risk assessment or AML/CFT programme being, or proposed to be, relied on by the reporting entity is not appropriate for that entity.

(2) This section is subject to section 33, which relates to the protection of personal information.

(1) Subject to the conditions in subsection (2), a reporting entity may rely on another person (who is not an agent) to conduct the customer due diligence procedures required for customer due diligence under this Act or regulations.

(2) The conditions are that—

• (a) the person being relied on is either—

  • (i) a reporting entity; or

  • (ii) a person who is resident in a country with sufficient anti-money laundering and countering financing of terrorism systems and measures in place and who is supervised or regulated for AML/CFT purposes; and

• (b) the person has a business relationship with the customer concerned; and

• (c) the person has conducted relevant customer due diligence procedures to at least the standard required by this Act and regulations and has provided to the reporting entity—

  • (i) relevant identity information before the reporting entity establishes a business relationship or an occasional transaction is conducted; and

  • (ii) relevant verification information as soon as practicable, but no later than 5 working days, after the business relationship is established or the occasional transaction is conducted; and

• (d) the person consents to conducting the customer due diligence procedures for the reporting entity and to providing all relevant information to the reporting entity; and

• (e) any other conditions prescribed by regulations are complied with.

(3) Despite subsection (1), a reporting entity relying on a third party to conduct the customer due diligence procedure, and not the person carrying out the customer due diligence procedure, is responsible for ensuring that customer due diligence is carried out in accordance with this Act.

Subject to any conditions that may be prescribed by regulations, a reporting entity may authorise a person to be its agent and rely on that agent to conduct the customer due diligence procedures and obtain any information required for customer due diligence under this Act or regulations.

Information obtained by a third party conducting customer due diligence under sections 29 to 31 for a reporting entity may only be used by that third party for the purpose of complying with this Act and regulations.

(1) This section applies to personal information that is either—

• (a) identity or verification information received for the purposes of section 29(1)(a); or

• (b) information received for the purposes of section 29(1)(b).

(2) Any information supplied by any member of a designated business group to another member of that group must be subject to privacy protections at least equivalent to those set out in privacy principles 5 to 11 in section 6 of the Privacy Act 1993.

(3) Each member of the designated business group must agree, in writing, to comply with privacy principles 5 to 11 in section 6 of the Privacy Act 1993 or their equivalent if the member is resident overseas.

(4) The entity that provides information to another member of its designated business group remains responsible for the use or disclosure of that information.

(5) A reporting entity may use or disclose information to which this section applies only as follows:

• (a) it may use identity and verification information received for the purposes of section 29(1)(a) in a suspicious transactions report:

• (b) it may disclose information for the purposes of section 29(1)(b) to another member of the designated business group unless such disclosure is likely to result in a suspicious transaction report being filed in an overseas jurisdiction by the member to whom the information is disclosed.

If, in relation to a customer, a reporting entity is unable to conduct customer due diligence in accordance with this subpart, the reporting entity—

• (a) must not establish a business relationship with the customer; and

• (b) must terminate any existing business relationship with the customer; and

• (c) must not carry out an occasional transaction with or for the customer; and

• (d) must consider whether to make a suspicious transactions report; and

• (e) may disclose the possibility of making a suspicious transaction report only to a person referred to in section 43(2).

(1) A reporting entity must not,—

• (a) knowingly or recklessly, set up a facility for a customer on the basis of customer anonymity:

• (b) without lawful justification or reasonable excuse, set up a facility for a customer under a false customer name.

(2) Subsection (1) does not apply to a facility—

• (a) that has a number or other identifier allocated to it and the customer or the person who is authorised to act on behalf of the customer in respect of the facility has had their identity verified in accordance with the relevant customer due diligence requirements; or

• (b) that has been set up for the Commissioner or for the New Zealand Security Intelligence Service for law enforcement purposes.

(1) A reporting entity must not establish or continue a business relationship with, or allow an occasional transaction to be conducted through it by,—

• (a) a shell bank; or

• (b) a financial institution that has a correspondent banking relationship with a shell bank.

(2) For the purposes of subsection (1), a shell bank is a corporation that—

• (a) is incorporated in a foreign country; and

• (b) is authorised to carry on banking business in its country of incorporation; and

• (c) does not have a physical presence in its country of incorporation; and

• (d) is not an affiliate of another corporation that—

  • (i) is incorporated in a particular country; and

  • (ii) is authorised to carry on banking business in its country of incorporation; and

  • (iii) is sufficiently supervised and monitored in carrying on its banking business; and

  • (iv) has a physical presence in its country of incorporation.

(3) For the purposes of paragraph (d) of the definition of shell bank in subsection (2), a corporation is affiliated with another corporation only if—

• (a) the corporation is a subsidiary of the other corporation; or

• (b) both corporations are under common effective control; or

• (c) both corporations are declared to be affiliated in accordance with regulations (if any).

(4) For the purposes of the definition of shell bank in subsection (2), a corporation has a physical presence in a country if, and only if,—

• (a) the corporation carries on banking business at a place in that country; and

• (b) banking operations of the corporation are managed and conducted from that place.

(1) Despite any other enactment or any rule of law, but subject to section 39 of this Act and to section 44(4) of the Terrorism Suppression Act 2002, this section applies if—

• (a) a person conducts or seeks to conduct a transaction through a reporting entity; and

• (b) the reporting entity has reasonable grounds to suspect that the transaction or proposed transaction is or may be—

  • (i) relevant to the investigation or prosecution of any person for a money laundering offence; or

  • (ii) relevant to the enforcement of the Misuse of Drugs Act 1975; or

  • (iii) relevant to the enforcement of the Terrorism Suppression Act 2002; or

  • (iv) relevant to the enforcement of the Proceeds of Crime Act 1991 or the Criminal Proceeds (Recovery) Act 2009; or

  • (v) relevant to the investigation or prosecution of a serious offence within the meaning of section 243(1) of the Crimes Act 1961.

(2) If this section applies, the reporting entity must, as soon as practicable, but no later than 3 working days after forming its suspicion, report the transaction or proposed transaction to the Commissioner, in accordance with section 38.

(3) Nothing in subsection (2) requires any lawyer to disclose any privileged communication (as defined in section 39).

(1) Except as provided in subsection (2), a report under section 37 must—

• (a) be in the prescribed form (if any); and

• (b) contain the details prescribed by regulations; and

• (c) contain a statement of the grounds on which the reporting entity holds the suspicions referred to in section 37(1)(b); and

• (d) be signed by a person authorised by the reporting entity to sign suspicious transaction reports (unless the report is forwarded by email or another similar means of communication); and

• (e) be forwarded, in writing, to the Commissioner—

  • (i) by way of secure electronic transmission by a means specified or provided by the Commissioner for this purpose; or

  • (ii) by another means (including, without limitation, by way of transmission by fax or email) that may be agreed from time to time between the Commissioner and the reporting entity concerned.

(2) However, if the urgency of the situation requires, a suspicious transaction report may be made orally to any Police employee authorised for the purpose by the Commissioner, but in any such case the reporting entity must, as soon as practicable, but no later than 3 working days, forward to the Commissioner a suspicious transaction report that complies with the requirements in subsection (1).

(3) The Commissioner may confer the authority to receive a suspicious transaction report under subsection (2) on—

• (a) any specified Police employee; or

• (b) Police employees of any specified rank or class; or

• (c) any Police employee or Police employees for the time being holding any specified office or specified class of offices.

(1) For the purposes of section 37(3), a communication is a privileged communication only if—

• (a) it is a confidential communication, whether oral or written, passing between—

  • (i) a lawyer in his or her professional capacity and another lawyer in that capacity:

  • (ii) a lawyer in his or her professional capacity and his or her client:

  • (iii) any person described in subparagraph (i) or (ii) and the agent of the other person described in that paragraph, or between the agents of both the persons described, either directly or indirectly; and

• (b) it is made or brought into existence for the purpose of obtaining or giving legal advice or assistance; and

• (c) it is not made or brought into existence for the purpose of committing or furthering the commission of some illegal or wrongful act.

(2) However, where the information consists wholly or partly of, or relates wholly or partly to, the receipts, payments, income, expenditure, or financial transactions of a specified person (whether a lawyer, his or her client, or any other person), it is not a privileged communication if it is contained in, or comprises the whole or part of, any book, account, statement, or other record prepared or kept by the lawyer in connection with a trust account of the lawyer within the meaning of section 6 of the Lawyers and Conveyancers Act 2006.

(3) For the purposes of this section, references to a lawyer include a firm in which he or she is a partner or is held out to be a partner.

(1) Despite any other enactment or any rule of law, this section applies to a person who, in the course of carrying out the duties of that person’s occupation as an auditor, has reasonable grounds to suspect, in relation to any transaction, that the transaction is—

• (a) relevant to the investigation or prosecution of any person for a money laundering offence; or

• (ab) relevant to the enforcement of the Misuse of Drugs Act 1975; or

• (b) relevant to the enforcement of the Terrorism Suppression Act 2002; or

• (c) relevant to the enforcement of the Proceeds of Crime Act 1991 or the Criminal Proceeds (Recovery) Act 2009; or

• (d) relevant to the investigation or prosecution of a serious offence within the meaning of section 243(1) of the Crimes Act 1961.

(2) A person may report a transaction referred to in subsection (1) to the Commissioner.

(1) Subsection (2) applies to a person who—

• (a) discloses or supplies any information in any suspicious transaction report; or

• (b) supplies any information in connection with any suspicious transaction report, whether at the time the report is made or afterwards.

(2) No civil, criminal, and disciplinary proceedings lie against a person to whom subsection (1) applies—

• (a) in respect of the disclosure or supply, or the manner of the disclosure or supply, by that person of the information referred to in that subsection; or

• (b) for any consequences that follow from the disclosure or supply of that information.

(3) If any information is reported under section 40 to any Police employee by any person, no civil, criminal, or disciplinary proceedings lie against that person—

• (a) in respect of the disclosure or supply, or the manner of the disclosure or supply, of that information by that person; or

• (b) for any consequences that follow from the disclosure or supply of that information.

(4) However, subsections (2) and (3) do not apply if the information was disclosed or supplied in bad faith.

(5) Nothing in this section applies in respect of proceedings for an offence under any of sections 90 to 95.

(1) This section applies if—

• (a) a person does any act that would constitute, or the person believes would constitute, an offence against section 243(2) or (3) of the Crimes Act 1961; and

• (b) in respect of the doing of that act, that person would have, by virtue of section 244(a) of the Crimes Act 1961, a defence to a charge under section 243(2) or (3) of that Act; and

• (c) that person discloses, to any Police employee, any information relating to a money laundering transaction (within the meaning of section 243(4) of the Crimes Act 1961), being a money laundering transaction that constitutes (in whole or in part), or is connected with or related to, the act referred to in paragraph (a); and

• (d) that information is so disclosed, in good faith, for the purpose of, or in connection with, the enforcement or intended enforcement of any enactment or provision referred to in section 244(a) of the Crimes Act 1961; and

• (e) that person is otherwise under any obligation (whether arising by virtue of any enactment or any rule of law or any other instrument) to maintain secrecy in relation to, or not to disclose, that information.

(2) If this section applies, then, without limiting section 41 and despite that the disclosure would otherwise constitute a breach of that obligation of secrecy or non-disclosure, the disclosure by that person, to that Police employee, of that information is not a breach of that obligation of secrecy or non-disclosure or (where applicable) of any enactment by which that obligation is imposed.

(1) This section and section 44 apply in respect of the following information:

• (a) any suspicious transaction report:

• (b) any information the disclosure of which will identify, or is reasonably likely to identify, any person—

  • (i) as a person who, in his or her capacity as an officer or employee of a reporting entity, has handled a transaction in respect of which a suspicious transaction report was made; or

  • (ii) as a person who has prepared a suspicious transaction report; or

  • (iii) as a person who has made a suspicious transaction report:

• (c) any information that discloses, or is reasonably likely to disclose, the existence of a suspicious transaction report.

(2) A reporting entity must not disclose information to which this section relates to any person except—

• (a) a Police employee who is authorised by the Commissioner to receive the information; or

• (b) the reporting entity’s AML/CFT supervisor; or

• (c) an officer or employee of the reporting entity, for any purpose connected with the performance of that person's duties; or

• (d) a barrister or solicitor, for the purpose of obtaining legal advice or representation in relation to the matter; or

• (e) another member of a designated business group of which the reporting entity is a member to the extent necessary to decide whether to make a suspicious transaction report.

(3) A Police employee may only disclose information to which this section applies for law enforcement purposes.

(4) An AML/CFT supervisor may only disclose information to which this section applies to the Police for law enforcement purposes.

(4A) A person to whom a function or power has been delegated under section 130A may disclose information to which this section applies only to the AML/CFT supervisor that made the delegation.

(5) A person (person A) referred to in subsection (2)(c) to whom disclosure of any information to which that subsection applies has been made must not disclose that information except to another person of the kind referred to in that subsection for the purpose of—

• (a) the performance of person A's duties; or

• (b) obtaining legal advice or representation in relation to the matter.

(6) A person referred to in subsection (2)(d) to whom disclosure of any information to which that subsection applies has been made must not disclose that information except to a person of the kind referred to in that subsection for the purpose of giving legal advice or making representations in relation to the matter.

(7) Any other person who has information to which this section applies may only disclose that information to the Police for law enforcement purposes.

(1) No person may disclose, in any judicial proceeding (within the meaning of section 108 of the Crimes Act 1961), any information to which this section applies unless the Judge or, as the case requires, the person presiding at the proceeding is satisfied that the disclosure of the information is necessary in the interests of justice.

(2) Nothing in this section prohibits the disclosure of any information for the purposes of the prosecution of any offence against section 91 or 92.

An AML/CFT supervisor that has, in the performance and exercise of its functions and powers under this Act, obtained personal information about employees or senior managers may disclose that information to another government agency for the following purposes if the AML/CFT supervisor is satisfied that the agency has a proper interest in receiving the information:

• (a) law enforcement purposes:

• (b) the detection, investigation, and prosecution of any offence under the following Acts:

  • (i) the Companies Act 1993:

  • (ii) the Financial Advisers Act 2008:

  • (iii) the Financial Service Providers (Registration and Dispute Resolution) Act 2008:

  • (iv) the Gambling Act 2003:

  • (v) the Reserve Bank of New Zealand Act 1989:

  • (vi) the Securities Act 1978:

  • (vii) the Securities Markets Act 1988.

(1) In relation to every transaction that is conducted through a reporting entity, the reporting entity must keep those records that are reasonably necessary to enable that transaction to be readily reconstructed at any time.

(2) Without limiting subsection (1), records must contain the following information:

• (a) the nature of the transaction:

• (b) the amount of the transaction and the currency in which it was denominated:

• (c) the date on which the transaction was conducted:

• (d) the parties to the transaction:

• (e) if applicable, the facility through which the transaction was conducted, and any other facilities (whether or not provided by the reporting entity) directly involved in the transaction:

• (f) the name of the officer or employee or agent of the reporting entity who handled the transaction, if that officer, employee, or agent—

  • (i) has face-to-face dealings in respect of the transaction with any of the parties to the transaction; and

  • (ii) has formed a suspicion (of the kind referred to in section 37(1)(b)) about the transaction:

• (g) any other information prescribed by regulations.

(3) A reporting entity must retain the records kept by that reporting entity, in accordance with this section, in relation to a transaction for—

• (a) a period of at least 5 years after the completion of that transaction; or

• (b) any longer period that the AML/CFT supervisor for the reporting entity, or the Commissioner, specifies.

(1) In respect of each case in which a reporting entity is required, under subpart 1 of this Part, to identify and verify the identity of a person, the reporting entity must keep those records that are reasonably necessary to enable the nature of the evidence used for the purposes of that identification and verification to be readily identified at any time.

(2) Without limiting subsection (1), those records may comprise—

• (a) a copy of the evidence so used; or

• (b) if it is not practicable to retain that evidence, any information as is reasonably necessary to enable that evidence to be obtained.

(3) A reporting entity must retain the records kept by that reporting entity for,—

• (a) in the case of records relating to the identity and verification of the identity of a person in relation to establishing a business relationship, a period of at least 5 years after the end of that business relationship; or

• (b) in the case of records relating to the identity and verification of the identity of a person in relation to conducting an occasional transaction, a period of at least 5 years after the completion of that occasional transaction; or

• (c) in the case of records relating to the identity and verification of the identity of an originator in relation to a wire transfer,—

  • (i) if the wire transfer is conducted by a customer with whom the reporting entity has a business relationship, a period of at least 5 years after the end of that business relationship; or

  • (ii) if the wire transfer is an occasional transaction, a period of at least 5 years after the completion of the wire transfer.

(1) A reporting entity must keep the following records in addition to the records referred to in sections 46 and 47:

• (a) records that are relevant to the establishment of the business relationship; and

• (ab) records relating to risk assessments, AML/CFT programmes, and audits; and

• (b) any other records (for example, account files, business correspondence, and written findings) relating to, and obtained during the course of, a business relationship that are reasonably necessary to establish the nature and purpose of, and activities relating to, the business relationship.

(2) The records must be kept in accordance with section 49 for a period of at least 5 years after the end of the business relationship.

(3) A reporting entity must make records relating to risk assessments, AML/CFT programmes, and audits available to its AML/CFT supervisor on request.

Records required by this subpart to be kept by a reporting entity must—

• (a) be kept either in written form in the English language, or so as to enable the records to be readily accessible and readily convertible into written form in the English language; and

• (b) be kept in the manner prescribed by regulations (if any).

(1) Nothing in this subpart requires the retention of any records kept by a reporting entity that has been liquidated and finally dissolved except as provided in subsection (2).

(2) The High Court may, in relation to a reporting entity that is being or has been liquidated, make an order requiring that any or all of the records referred to in sections 47 and 48 be kept for any period it thinks fit.

(1) Subject to subsection (2), a reporting entity must take all practicable steps to ensure that every record retained by that reporting entity under this subpart, and every copy of that record, is destroyed as soon as practicable after the expiry of the period for which the reporting entity is required to retain that record.

(2) Nothing in this section requires the destruction of any record, or any copy of any record, in any case where there is a lawful reason for retaining that record.

(3) Without limiting subsection (2), there is a lawful reason for retaining a record if the retention of that record is necessary—

• (a) in order to comply with the requirements of any other enactment; or

• (b) to enable a reporting entity to carry on its business; or

• (c) for the purposes of the detection, investigation, or prosecution of any offence.

Nothing in this subpart limits or affects any other enactment that requires any reporting entity to keep or retain a record.

(1) A reporting entity must establish, implement, and maintain a compliance programme (an AML/CFT programme) that includes internal procedures, policies, and controls to—

• (a) detect money laundering and the financing of terrorism; and

• (b) manage and mitigate the risk of money laundering and financing of terrorism.

(2) A reporting entity must designate an employee as an AML/CFT compliance officer to administer and maintain its AML/CFT programme.

(2A) In the case of a reporting entity that does not have employees, the reporting entity must appoint a person to act as its AML/CFT compliance officer.

(3) The AML/CFT compliance officer must report to a senior manager of the reporting entity.

A reporting entity’s AML/CFT programme must be based on the risk assessment undertaken in accordance with section 55 and include adequate and effective procedures, policies, and controls for—

• (a) vetting—

  • (i) senior managers:

  • (ii) the AML/CFT compliance officer:

  • (iii) any other employee that is engaged in AML/CFT related duties; and

• (b) training on AML/CFT matters for the following employees:

  • (i) senior managers:

  • (ii) the AML/CFT compliance officer:

  • (iii) any other employee that is engaged in AML/CFT related duties; and

• (c) complying with customer due diligence requirements (including ongoing customer due diligence and account monitoring); and

• (d) reporting suspicious transactions; and

• (e) record keeping; and

• (f) setting out what the reporting entity needs to do, or continue to do, to manage and mitigate the risks of money laundering and the financing of terrorism; and

• (h) examining, and keeping written findings relating to,—

  • (i) complex or unusually large transactions; and

  • (ii) unusual patterns of transactions that have no apparent economic or visible lawful purpose; and

  • (iii) any other activity that the reporting entity regards as being particularly likely by its nature to be related to money laundering or the financing of terrorism; and

• (i) monitoring, examining, and keeping written findings relating to business relationships and transactions from or in countries that do not have or have insufficient anti-money laundering or countering financing of terrorism systems in place and have additional measures for dealing with or restricting dealings with such countries; and

• (j) preventing the use, for money laundering or the financing of terrorism, of products (for example, the misuse of technology) and transactions (for example, non-face-to-face business relationships or transactions) that might favour anonymity; and

• (k) determining when enhanced customer due diligence is required and when simplified customer due diligence might be permitted; and

• (l) providing when a person who is not the reporting entity may, and setting out the procedures for the person to, conduct the relevant customer due diligence on behalf of the reporting entity; and

• (m) monitoring and managing compliance with, and the internal communication of and training in, those procedures, policies, and controls.

(1) Before conducting customer due diligence or establishing an AML/CFT programme, a reporting entity must first undertake an assessment of the risk of money laundering and the financing of terrorism (a risk assessment) that it may reasonably expect to face in the course of its business.

(2) In assessing the risk, the reporting entity must have regard to the following:

• (a) the nature, size, and complexity of its business; and

• (b) the products and services it offers; and

• (c) the methods by which it delivers products and services to its customers; and

• (d) the types of customers it deals with; and

• (e) the countries it deals with; and

• (f) the institutions it deals with; and

• (g) any applicable guidance material produced by AML/CFT supervisors or the Commissioner relating to risk assessments; and

• (h) any other factors that may be provided for in regulations.

(3) The risk assessment must be in writing and—

• (a) identify the risks faced by the reporting entity in the course of its business; and

• (b) describe how the reporting entity will ensure that the assessment remains current; and

• (c) enable the reporting entity to determine the level of risk involved in relation to relevant obligations under this Act and regulations.

(1) A reporting entity must review its risk assessment and AML/CFT programme to—

• (a) ensure the risk assessment and AML/CFT programme remain current; and

• (b) identify any deficiencies in the effectiveness of the risk assessment and the AML/CFT programme; and

• (c) make any changes to the risk assessment or AML/CFT programme identified as being necessary under paragraph (b).

(2) A reporting entity must ensure its risk assessment and AML/CFT programme are audited every 2 years or at any other time at the request of the relevant AML/CFT supervisor.

(3) The audit must be carried out by an independent person appointed by the reporting entity who is appropriately qualified to conduct the audit.

(4) A person appointed to conduct an audit is not required to be—

• (a) a chartered accountant within the meaning of section 19 of the Institute of Chartered Accountants of New Zealand Act 1996; or

• (b) qualified to undertake financial audits.

(5) A person appointed to conduct an audit must not have been involved in—

• (a) the establishment, implementation, or maintenance of the reporting entity's AML/CFT programme:

• (b) the undertaking of the reporting entity's risk assessment.

(6) The audit of the risk assessment is limited to an audit of whether the reporting entity's risk assessment fulfils the requirements in section 55(3).

(7) A reporting entity must provide a copy of any audit to its AML/CFT supervisor on request.

(1) The reporting entity must prepare an annual report on its risk assessment and AML/CFT programme.

(2) An annual report must—

• (a) be in the prescribed form; and

• (b) take into account the results and implications of the audit required by section 56(2); and

• (c) contain any information prescribed by regulations.

(3) The reporting entity must provide the annual report to its AML/CFT supervisor at a time appointed by the AML/CFT supervisor.

(4) The AML/CFT supervisor must give the reporting entity reasonable notice of the requirement to provide the annual report.

(1) A reporting entity must ensure that its branches and subsidiaries that are in a foreign country apply, to the extent permitted by the law of that country, measures broadly equivalent to those set out in this Act and regulations with regard to the requirements for customer due diligence (including ongoing customer due diligence), risk assessments, AML/CFT programmes, and record keeping.

(2) If the law of the foreign country does not permit the application of those equivalent measures by the branch or the subsidiary located in that country, the reporting entity must—

• (a) inform its AML/CFT supervisor accordingly; and

• (b) take additional measures to effectively handle the risk of a money laundering offence and the financing of terrorism.

(3) A reporting entity must communicate (where relevant) the policies, procedures, and controls that it establishes, implements, and maintains in accordance with this subpart to its branches and subsidiaries that are outside New Zealand.

In this Part, unless the context otherwise requires,—

(1) An AML/CFT supervisor must, if directed to do so by the Minister responsible for that AML/CFT supervisor (the responsible Minister), prepare—

• (a) 1 or more codes of practice for the sector of activity of the reporting entities for which it is the supervisor under section 127 or in respect of different reporting entities specified by the responsible Minister:

• (b) an instrument that amends a code of practice or revokes the whole or any provision of a code of practice prepared under paragraph (a).

(2) The purpose of a code of practice is to provide a statement of practice that assists reporting entities to comply with their obligations under this Act and regulations.

(3) A direction under subsection (1) may (without limitation)—

• (a) relate generally to the obligations imposed on the relevant reporting entities by or under this Act or regulations or specify particular aspects of those obligations that are to be covered by the code of practice:

• (b) specify the amendments to be made or their intended effect, and specify the extent of the revocation to be made:

• (c) indicate the date by which the responsible Minister wishes the code of practice to be provided to him or her:

• (d) include details about the recommendation that the AML/CFT supervisor is required to provide under section 61(1)(a).

(4) An AML/CFT supervisor must comply with a direction under subsection (1) as soon as practicable.

(5) No code of practice has legal effect until approved by the responsible Minister under section 61(6).

(1) The responsible Minister must not approve a code of practice prepared by an AML/CFT supervisor unless—

• (a) the AML/CFT supervisor has made a recommendation that the Minister should approve the code of practice; and

• (b) the AML/CFT supervisor has consulted the persons and organisations that the Minister thinks appropriate, having regard to the subject matter of the proposed code of practice.

(2) In consulting under subsection (1)(b), the AML/CFT supervisor must ensure that—

• (a) a copy of the proposed code of practice or a summary of its contents, in hard copy or electronic format, is provided to the persons and organisations being consulted; and

• (b) the persons and organisations being consulted have at least 20 working days to make submissions or representations about the proposed code of practice.

(3) The responsible Minister may direct the AML/CFT supervisor to reconsider any aspect of the proposed code of practice and to make any amendments that the Minister considers necessary.

(4) Despite subsection (3),—

• (a) if the AML/CFT supervisor does not amend the proposed code of practice as directed by the Minister or within the time specified by the Minister, the Minister may make those amendments:

• (b) the Minister may, after consultation with the AML/CFT supervisor, make any further amendments to the proposed code of practice that he or she considers necessary.

(5) The responsible Minister must—

• (a) approve the proposed code of practice as prepared by the AML/CFT supervisor; or

• (b) approve the proposed code of practice as amended by the AML/CFT supervisor; or

• (c) approve the proposed code of practice as amended by the Minister after consultation with the AML/CFT supervisor.

(6) The responsible Minister approves a code of practice by notice in the Gazette, and the notice—

• (a) must either set out the code of practice or state where copies of the code of practice in hard copy or electronic format may be obtained or viewed:

• (b) is not a regulation for the purposes of the Acts and Regulations Publication Act 1989, but is a regulation for the purposes of the Regulations (Disallowance) Act 1989.

(1) A code of practice may be amended or revoked in the same manner as that in which it was made.

(2) Sections 60, 61, 63, and 64 apply with the necessary modifications to the amendment or revocation of a code of practice.

Publication in the Gazette of a notice under section 61(6) is conclusive evidence that the requirements of sections 61(1) to (5) and 62 have been complied with in respect of the approval specified in the notice.

(1) A reporting entity complies with an obligation imposed on it by or under this Act or regulations by—

• (a) complying with those provisions of a code of practice that state a means of satisfying the obligation; or

• (b) complying with the obligation by some other equally effective means.

(2) However, a reporting entity may not rely on subsection (1)(b) as a defence to an act or omission on its part unless it has, by notice in writing given before the act or omission occurred, advised the AML/CFT supervisor that it has opted out of compliance with the code of practice and intends to satisfy its obligations by some other equally effective means.

(3) If a person is charged with an offence in respect of a failure to comply with any provision of this Act, a court must, in determining whether that person has failed to comply with the provision, have regard to any code of practice in force under section 61(6) at the time of the alleged failure relating to matters of the kind to which the provision relates.

(4) If an application for an injunction against a person has been made under this Act, a court must, in determining whether to grant the injunction, have regard to any code of practice in force under section 61(6).

(5) If an application for a pecuniary penalty against a person has been made under this Act, a court must, in determining whether to impose a pecuniary penalty, have regard to any code of practice in force under section 61(6) at the time the person engaged in conduct that constituted the relevant civil liability act.

(1) A person must not move cash into or out of New Zealand if—

• (a) the total amount of the cash is more than the applicable threshold value; and

• (b) the person has not given a report in respect of the movement of that cash in accordance with this subpart; and

• (c) the movement of that cash is not exempted under this Act or regulations (if any).

(2) For the purposes of this Act, a person moves cash into New Zealand if the person brings or sends the cash into New Zealand.

(3) For the purposes of this Act, a person moves cash out of New Zealand if the person takes or sends the cash out of New Zealand.

A person must not receive cash moved to the person from outside New Zealand if—

• (a) the total amount of the cash is more than the applicable threshold value; and

• (b) the person has not given a report in respect of the movement of that cash in accordance with this subpart; and

• (c) the movement of that cash is not exempted under this Act or regulations (if any).

A report under this subpart must—

• (a) be in writing in the prescribed form; and

• (b) contain the prescribed information; and

• (c) be completed in accordance with regulations (if any); and

• (d) be provided to a Customs officer,—

  • (i) in the case of accompanied cash, at the same time as a departure card is presented in accordance with section 126(2) of the Immigration Act 1987:

  • (ii) in the case of unaccompanied cash, before the cash leaves New Zealand.

(1) If a report is made to a Customs officer under this subpart, that officer must, as soon as practicable, forward the report to the Commissioner.

(2) If, in the course of conducting a search under this Act, a Customs officer discovers any cash in respect of which a report is required to be made under this subpart but has not been made, that officer must, as soon as practicable, report the details of the search, and of the cash, to the Commissioner.

(3) Every report made under subsection (2) must be in the form that the Commissioner may determine after consultation with the chief executive of the New Zealand Customs Service.

(4) The chief executive of the New Zealand Customs Service must—

• (a) cause a record to be made and kept of—

  • (i) each occasion on which a cash report is made to a Customs officer; and

  • (ii) the details of the identity of the person making the cash report; and

  • (iii) the date on which the cash report is made; and

• (b) ensure that the record is retained for a period of not less than 1 year after the date on which the cash report is made.

(1) An application for a civil penalty under this Part may be made no later than 6 years after the conduct giving rise to the liability to pay the civil penalty occurred.

(2) In proceedings for a civil penalty under this Part,—

• (a) the standard of proof is the standard of proof that applies in civil proceedings; and

• (b) the relevant AML/CFT supervisor may, by order of the court, obtain discovery and administer interrogatories.

(1) Criminal proceedings for an offence under this Part may be commenced against a person in relation to particular conduct whether or not proceedings for a civil penalty under this Part have been commenced against the person in relation to the same or substantially the same conduct.

(2) Proceedings under this Part for a civil penalty against a person in relation to particular conduct are stayed if criminal proceedings against the person are or have been commenced for an offence under this Part in relation to the same or substantially the same conduct.

(3) After the criminal proceedings referred to in subsection (2) have been completed or withdrawn, a person may apply to have the stay lifted on the civil penalty proceedings referred to in that subsection.

(1) If civil penalty or criminal proceedings under this Part are brought against a person in relation to particular conduct, a court may not impose a penalty (whether civil or criminal) on the person if a court has already imposed a penalty under this Part in proceedings relating to the same or substantially the same conduct.

(2) If a person is or may be liable to more than 1 civil penalty under this Part in respect of the same or substantially the same conduct, civil penalty proceedings may be brought against the person for more than 1 civil penalty, but the person may not be required to pay more than 1 civil penalty in respect of the same or substantially the same conduct.

(1) Evidence of information given, or evidence of production of documents, by a person is not admissible in criminal proceedings against the person for an offence under this Part or any other enactment if—

• (a) the person previously gave the evidence or produced the documents in civil penalty proceedings under this Part against him or her, whether or not a civil penalty was imposed; and

• (b) the proceedings for the civil penalty related to conduct that was the same or substantially the same as the conduct constituting the offence.

(2) This section does not apply to criminal proceedings in respect of the falsity of the evidence given by the person in the proceedings for the civil penalty.

No civil or criminal proceedings may be brought against an AML/CFT supervisor or a person who is or has been an officer, employee, member of, or member of the board of, an AML/CFT supervisor for anything done or omitted to be done in the course of the performance or exercise of the AML/CFT supervisor's functions or powers under this Act unless it is shown that the AML/CFT supervisor or the person concerned acted in bad faith.

No reporting entity, or person who is, or has been, an officer, an employee, or a member of the governing body of the reporting entity, or person appointed under section 53(2A) is criminally or civilly liable for any action taken in order to comply with this Act or regulations if the action—

• (a) was taken in good faith; and

• (b) was reasonable in the circumstances.

In this Part, a civil liability act occurs when a reporting entity fails to comply with any of the AML/CFT requirements, including, without limitation, when the reporting entity—

• (a) fails to conduct customer due diligence as required by subpart 1 of Part 2:

• (b) fails to adequately monitor accounts and transactions:

• (c) enters into or continues a business relationship with a person who does not produce or provide satisfactory evidence of the person’s identity:

• (d) enters into or continues a correspondent banking relationship with a shell bank:

• (e) fails to keep records in accordance with the requirements of subpart 3 of Part 2:

• (f) fails to establish, implement, or maintain an AML/CFT programme:

• (g) fails to ensure that its branches and subsidiaries comply with the relevant AML/CFT requirements.

If a civil liability act is alleged to have occurred, the relevant AML/CFT supervisor may do 1 or more of the following:

• (a) issue a formal warning under section 78:

• (b) accept an enforceable undertaking under section 79 and seek an order in the court for breach of that undertaking under section 80:

• (c) seek an injunction from the High Court under section 83 or 85:

• (d) apply to the court for a pecuniary penalty under section 88.

(1) The relevant AML/CFT supervisor may issue 1 or more formal warnings to a person if the AML/CFT supervisor has reasonable grounds to believe that that person has engaged in conduct that constituted a civil liability act.

(2) A formal warning must be—

• (a) in the prescribed form; and

• (b) issued in the manner specified in regulations (if any).

(1) The relevant AML/CFT supervisor may accept a written undertaking given by a person in connection with compliance with this Act or regulations (if any).

(2) The person may withdraw or vary the undertaking at any time, but only with the consent of the relevant AML/CFT supervisor.

(1) If the relevant AML/CFT supervisor considers that a person who gave an undertaking under section 79 has breached 1 or more of its terms, the relevant AML/CFT supervisor may apply to the court for an order under subsection (2).

(2) If the court is satisfied that the person has breached 1 or more of the terms of the undertaking, the court may make any or all of the following orders:

• (a) an order directing the person to comply with any of the terms of the undertaking:

• (b) an order directing the person to pay to the AML/CFT supervisor an amount up to the amount of any financial benefit that the person has obtained directly or indirectly and that is reasonably attributable to the breach:

• (c) any order that the court considers appropriate directing the person to compensate any other person who has suffered loss or damage as a result of the breach.

For the purposes of section 80(2)(c), in determining whether another person (person A) has suffered loss or damage as a result of the breach, and in assessing the amount of compensation payable, the court may have regard to the following:

• (a) the extent to which any expenses incurred by person A are attributable to dealing with the breach:

• (b) the effect of the breach on person A's ability to carry on business or other activities:

• (c) any damage to the reputation of person A's business that is attributable to dealing with the breach:

• (d) any loss of business opportunities suffered by person A as a result of dealing with the breach:

• (e) any other matters that the court considers relevant.

The powers in sections 83 to 87 are in addition to, and do not derogate from, any other powers of the High Court relating to the granting of injunctions.

(1) The High Court may, on the application of the relevant AML/CFT supervisor, grant an injunction requiring a person to do an act or thing if—

• (a) that person has refused or failed, or is refusing or failing, or is proposing to refuse or fail, to do that act or thing; and

• (b) the refusal or failure was, is, or would be a civil liability act.

(2) The court may rescind or vary an injunction granted under this section.

(1) The High Court may grant an injunction requiring a person to do an act or thing if—

• (a) it is satisfied that the person has refused or failed to do that act or thing; or

• (b) it appears to the court that, if an injunction is not granted, it is likely that the person will refuse or fail to do that act or thing.

(2) Subsection (1)(a) applies whether or not it appears to the court that the person intends to refuse or fail again, or to continue to refuse or fail, to do that act or thing.

(3) Subsection (1)(b) applies—

• (a) whether or not the person has previously refused or failed to do that act or thing; or

• (b) where there is an imminent danger of substantial damage to any other person if that person refuses or fails to do that act or thing.

(1) The High Court may, on the application of the relevant AML/CFT supervisor, grant an injunction restraining a person from engaging in conduct that constitutes or would constitute a contravention of a provision of this Act.

(2) The court may rescind or vary an injunction granted under this section.

(1) The High Court may grant an injunction restraining a person from engaging in conduct of a particular kind if—

• (a) it is satisfied that the person has engaged in conduct of that kind; or

• (b) it appears to the court that, if an injunction is not granted, it is likely that the person will engage in conduct of that kind.

(2) The court may grant an interim injunction restraining a person from engaging in conduct of a particular kind if, in its opinion, it is desirable to do so.

(3) Subsections (1)(a) and (2) apply whether or not it appears to the court that the person intends to engage again, or to continue to engage, in conduct of that kind.

(4) Subsections (1)(b) and (2) apply—

• (a) whether or not the person has previously engaged in conduct of that kind; or

• (b) where there is an imminent danger of substantial damage to any other person if that person engages in conduct of that kind.

(1) If the relevant AML/CFT supervisor applies to the High Court for the grant of an interim injunction under this subpart, the court must not, as a condition of granting an interim injunction, require the AML/CFT supervisor to give an undertaking as to damages.

(2) However, in determining the AML/CFT supervisor’s application for the grant of an interim injunction, the court must not take into account that the AML/CFT supervisor is not required to give an undertaking as to damages.

(1) On the application of the relevant AML/CFT supervisor, the High Court may order a person to pay a pecuniary penalty to the Crown, or to any other person specified by the court, if the court is satisfied that that person has engaged in conduct that constituted a civil liability act.

(2) For a civil liability act specified in section 76(b), (c), (d), or (g), the maximum amount of a pecuniary penalty under this Act is,—

• (a) in the case of an individual, $100,000; and

• (b) in the case of a body corporate, $1 million.

(3) For a civil liability act specified in section 76(a), (e), or (f), the maximum amount of a pecuniary penalty under this Act is,—

• (a) in the case of an individual, $200,000; and

• (b) in the case of a body corporate, $2 million.

(4) In determining an appropriate pecuniary penalty, the court must have regard to all relevant matters, including—

• (a) the nature and extent of the civil liability act; and

• (b) the likelihood, nature, and extent of any damage to the integrity or reputation of New Zealand’s financial system because of the civil liability act; and

• (c) the circumstances in which the civil liability act occurred; and

• (d) whether the person has previously been found by the court in proceedings under this Act to have engaged in any similar conduct.

A reporting entity that engages in conduct constituting a civil liability act commits an offence if the reporting entity engages in that conduct knowingly or recklessly.

A reporting entity commits an offence if—

• (a) a transaction is conducted or is sought to be conducted through the reporting entity; and

• (b) the reporting entity has reasonable grounds to suspect that the transaction or the proposed transaction is or may be—

  • (i) relevant to the investigation or prosecution of any person for a money laundering offence; or

  • (ia) relevant to the enforcement of the Misuse of Drugs Act 1975; or

  • (ii) relevant to the enforcement of the Terrorism Suppression Act 2002; or

  • (iii) relevant to the enforcement of the Proceeds of Crime Act 1991 or the Criminal Proceeds (Recovery) Act 2009; and

  • (iv) relevant to the investigation or prosecution of a serious offence within the meaning of section 243(1) of the Crimes Act 1961; and

• (c) the reporting entity fails to report the transaction or the proposed transaction to the Commissioner as soon as practicable, but no later than 3 working days, after forming that suspicion.

A person commits an offence who, in making a suspicious transaction report or in supplying information in connection with that report,—

• (a) makes any statement that the person knows is false or misleading in a material particular; or

• (b) omits from any statement any matter or thing without which the person knows that the statement is false or misleading in a material particular.

(1) A person commits an offence who contravenes section 43—

• (a) for the purpose of obtaining, directly or indirectly, an advantage or a pecuniary gain for that person or any other person; or

• (b) with intent to prejudice any investigation into—

  • (i) the commission or possible commission of a money laundering offence; or

  • (ii) the financing of terrorism or the possible financing of terrorism.

(2) A person commits an offence who—

• (a) is an officer or employee or a former officer or employee of a reporting entity, a person appointed as an AML/CFT compliance officer under section 53(2A), or an auditor for a reporting entity; and

• (b) has become aware, or became aware, in the course of that person’s duties as such an officer or employee, that any investigation into any transaction or proposed transaction that is the subject of a suspicious transaction report is being, or may be, conducted by the Police; and

• (c) knows that he or she is not legally authorised to disclose the information; and

• (d) discloses that information to any other person—

  • (i) for the purpose of obtaining, directly or indirectly, an advantage or a pecuniary gain for that person or any other person; or

  • (ii) with intent to prejudice any investigation into—

    • (A) the commission or possible commission of a money laundering offence; or

    • (B) the financing of terrorism or the possible financing of terrorism.

A reporting entity commits an offence if the reporting entity fails to keep or retain adequate records relating to a suspicious transaction.

A person commits an offence if the person obstructs any investigation relating to any suspicious transaction report without lawful justification or excuse.

A person commits an offence if the person acts in contravention of section 44(1) without lawful justification or excuse.

(1) It is a defence to a charge against a person in relation to a contravention of, or a failure to comply with, Part 2 if the defendant proves that—

• (a) the defendant took all reasonable steps to ensure that the defendant complied with that Part; or

• (b) in the circumstances of the particular case, the defendant could not reasonably have been expected to ensure that the defendant complied with that Part.

(2) In determining, for the purposes of subsection (1)(a), whether or not a defendant took all reasonable steps to comply with Part 2, the court must have regard to—

• (a) the nature of the reporting entity and the activities in which it engages; and

• (b) the existence and adequacy of any procedures established by the reporting entity to ensure compliance with that subpart.

(3) Except as provided in subsection (4), subsection (1) does not apply unless, within 21 days after the service of the summons, or within such further time as the court may allow, the defendant has delivered to the prosecutor a written notice—

• (a) stating that the defendant intends to rely on the defence referred to in subsection (1); and

• (b) specifying the reasonable steps that the defendant will claim to have taken.

(4) In any such prosecution, evidence that the defendant took a step not specified in the written notice required by subsection (3) is not, except with the leave of the court, admissible for the purpose of supporting a defence under subsection (1).

Despite anything in section 14 of the Summary Proceedings Act 1957, any information in respect of an offence under any of sections 89 to 95 may be laid at any time within 3 years after the time when the matter of the information arose.

A reporting entity or person who commits an offence under any of sections 89 to 95 is liable, on conviction, to,—

• (a) in the case of an individual, either or both of the following:

  • (i) a term of imprisonment of not more than 2 years:

  • (ii) a fine of up to $300,000; and

• (b) in the case of a body corporate, a fine of up to $5 million.

A person commits an offence if the person structures a transaction (other than a transaction that involves the cross-border transportation of cash) to avoid the application of any AML/CFT requirements.

A person commits an offence if the person wilfully obstructs any AML/CFT supervisor in the exercise of any power conferred or the performance of any function imposed on that supervisor by this Act.

A person commits an offence if, without reasonable excuse, the person provides information to an AML/CFT supervisor knowing that information to be false or misleading in any material respect.

Despite anything in section 14 of the Summary Proceedings Act 1957, any information in respect of an offence under any of sections 89 to 95 may be laid at any time within 3 years after the time when the matter of the information arose.

(1) A person who commits an offence under section 99 is liable, on conviction, to,—

• (a) in the case of an individual, either or both of the following:

  • (i) a term of imprisonment of not more than 2 years:

  • (ii) a fine of up to $300,000; and

• (b) in the case of a body corporate, a fine of up to $5 million.

(2) A person who commits an offence under either of sections 100 and 101 is liable, on conviction, to,—

• (a) in the case of an individual, either or both of the following:

  • (i) a term of imprisonment of not more than 3 months:

  • (ii) a fine of up to $10,000; and

• (b) in the case of a body corporate, a fine of up to $50,000.

A person commits an offence if the person fails, without reasonable excuse, to make or cause to be made a cash report, in accordance with subpart 6 of Part 2, concerning cash over the applicable threshold value that the person has moved into or out of New Zealand.

A person commits an offence if the person fails, without reasonable excuse, to make or cause to be made a cash report, in accordance with subpart 6 of Part 2, concerning cash over the applicable threshold value that the person has received in New Zealand from overseas.

A person commits an offence if the person structures a cross-border transportation of cash to avoid the application of any AML/CFT requirements.

It is a defence to an offence under section 104 or 105 in relation to a failure to make or cause to be made a cash report to a Customs officer under section 67(d) if the defendant proves that—

• (a) the failure was due to some emergency or to any other circumstances outside the reasonable control of the defendant; and

• (b) the defendant made or caused to be made a report in respect of that cash as soon as practicable after the obligation to make the report arose.

A person commits an offence if, without reasonable excuse, the person makes or causes to be made a cash report knowing it is false or misleading in any material respect.

(1) A person commits an offence if the person wilfully obstructs any Customs officer in the exercise of any power conferred or performance of any duty imposed on that officer by this Act.

(2) A person commits an offence if, without reasonable excuse, the person fails to answer questions from a Customs officer.

A person who commits an offence under any of sections 104, 105, 106, 108, and 109 is liable, on summary conviction, to,—

• (a) in the case of an individual, either or both of the following:

  • (i) a term of imprisonment of not more than 3 months:

  • (ii) a fine of up to $10,000; and

• (b) in the case of a body corporate, a fine of up to $50,000.

(1) This section applies if, in any case to which section 104 or 105 applies, a person admits in writing that he or she has committed the offence and requests that the offence be dealt with summarily by the chief executive of the New Zealand Customs Service.

(2) If this section applies, the chief executive of the New Zealand Customs Service may, at any time before an information has been laid in respect of the offence, accept from that person a sum, not exceeding $500, that the chief executive of the New Zealand Customs Service thinks just in the circumstances of the case, in full satisfaction of any fine to which the person would otherwise be liable under section 110.

(3) If the chief executive of the New Zealand Customs Service accepts any sum under this section, the offender is not liable to be prosecuted for the offence in respect of which the payment was made.

(1) Nothing in this Act limits or affects the Customs and Excise Act 1996.

(2) The movement of cash in breach of any requirement of this Act or any regulations is, for the purposes of the Customs and Excise Act 1996, the importation or exportation of a prohibited good.

(3) It is the duty of every Customs officer to prevent the movement of cash that is in breach of any requirement of this Act or any regulations.

(4) For the purpose of carrying out the duty in subsection (3), a Customs officer may exercise his or her powers under the following sections of the Customs and Excise Act 1996 in relation to uncustomed or prohibited goods:

• (a) section 145 (questioning persons about goods and debt):

• (b) section 148 (detention of persons questioned about goods or debt):

• (c) sections 149, 149A, 149B, 149C(1) and (2), and 149D (which relate to search and seizure):

• (d) sections 151 and 152 (which relate to examination of goods):

• (e) section 161 (further powers in relation to documents):

• (f) section 165 (copying of documents obtained during search):

• (g) section 166 (retention of documents and goods obtained during search):

• (h) sections 166A to 166F (which relate to seizure and detention of goods suspected to be tainted property):

• (i) sections 167 to 172 (which relate to search warrants and use of aids by Customs officers).

(1) A Customs officer exercising a search or examination power under section 112(4) may require a specified person to provide access information and other information or assistance that is reasonable and necessary to allow the Customs officer to access data held in, or accessible from,—

• (a) a computer:

• (b) any other data storage device.

(2) In this section,—

(3) A specified person may not be required under subsection (1) to give any information tending to incriminate the person.

(4) Subsection (3) does not prevent a Customs officer exercising a search power from requiring a specified person to provide information that—

• (a) is reasonable and necessary to allow the person exercising the search power to access data held in, or accessible from, a computer or other storage device that contains or may contain information tending to incriminate the specified person; but

• (b) does not itself tend to incriminate the specified person.

(5) Subsection (3) does not prevent a Customs officer exercising a search power from requiring a specified person to provide assistance that is reasonable and necessary to allow the Customs officer exercising the search power to access data held in, or accessible from, a computer or other storage device that contains, or may contain, information tending to incriminate the specified person.

(6) Subsections (1), (4), and (5) are subject to section 162 of the Customs and Excise Act 1996 (which relates to privilege and confidentiality).

In this subpart, unless the context otherwise requires,—

(1) An enforcement officer may apply for a search warrant in respect of a place.