Financial institutions and casinos now have access to information about potential money laundering risks in their sector following the release of Sector Risk Assessments today.
The assessments will assist the businesses who need to comply with the Anti-Money Laundering and Countering Financing of Terrorism Act 2009 (the AML/CFT Act), which is likely to come fully into force in 2013. The AML/CFT Act provides a framework which will help prevent New Zealand businesses from being used for the purpose of criminal activity.
Internal Affairs’ Acting GM of Regulatory and Compliance operations, Mike Hill, said the Sector Risk Assessment (SRA) is an important requirement for the Department. It looks at the risks of money laundering in casinos, money service businesses, payroll remittance, lending, financial leasing, safe deposit/cash storage and non-bank credit card providers.
The AML/CFT Act requires businesses to undertake their own risk assessments before establishing an AML/CFT programme, Mike Hill said. “The SRA provides guidance to these businesses on areas of higher risk and will assist them to undertake risk assessments in their own businesses.
“The assessments of each sector are based on risk indicators which include size and scale of the sector, cash intensity of the business, amount of international business, customer base and indicators of potential money laundering activities. Indicators of higher risk are cash-intensive products and services, along with certain types of customers.”
The risk ratings in the SRA apply to sectors as a whole, rather than to individual businesses. Individual companies may have particular features that mitigate or increase the risk.
The Internal Affairs’ Sector Risk Assessment can be found at http://www.dia.govt.nz/Anti-money-laundering-and-countering-financing-of-terrorism
The Securities Commission and the Reserve Bank are also releasing assessments relevant to the businesses they supervise. These can be found on their respective websites.