Some particular key issues that we see arising for law firms include:
- Assessing capture under the Act including whether procedures should be applied firm-wide or to specific teams.
- Appointment of the AML/CFT Compliance Officer and whether additional resources are required to support that individual.
- Collation of granular data in respect of existing services, customers, delivery channels, jurisdictions to include in the AML/CFT Risk Assessment; and for the Annual Report to the Supervisor.
- Whether key obligations (such as customer due diligence (CDD) will be centralised or implemented by front-line staff.
- Application of CDD processes in the context of overseas referrals or instructions.
- Processes for identifying higher risk customers.
- Ensuring efficiency in the way CDD is stored (e.g. ensuring that the identification of one individual can be linked to multiple entities and minimising re-identification of the same individuals).
- Delayed verification processes for urgent instructions.
- Having procedures in place that document when CDD will be triggered in an existing client base.
- The overlay of AML/CFT monitoring processes to existing trust account rules and procedures.
- Implementation of IT systems changes to align with AML/CFT obligations.
A “Reporting Entity” under the AML/CFT Act (Act) under s56 to 58 is required to produce a Risk Assessment and Compliance Programme for the purposes of the Act. This needs to include the appointment of an AML/CFT Compliance Officer and the need to comply with the Act from 1 July 2018.
Section 58(1) requires the Company to undertake an assessment of the risk of money laundering and the financing of terrorism that it may reasonably expect to face in the course of its business. The Risk Assessment must be in writing and must:
- Identify the risks faced by the Company in the course of its business.
- Describe how the Company will ensure that the assessment remains current.
- Enable the Company to determine the level of risk involved in relation to relevant obligations under the Act.
In assessing the risk, the Company must have regard to the following:
- The nature, size and complexity of its business.
- The products and services it offers.
- The methods by which it delivers products and services to its customers.
- The types of customers it deals with.
- The countries it deals with.
- The institutions it deals with.
- Any applicable guidance material produced by the AML/CFT Supervisors.
- Any other factors that may be provided for in regulations.
Section 56(1) requires the Company to establish, implement and maintain a Compliance Programme that includes internal procedures, policies and controls to:
- Detect money laundering and the financing of terrorism.
- Manage and mitigate the risk of money laundering and financing of terrorism.
The Compliance Programme must be based on the Risk Assessment and include adequate and effective procedures, policies and controls for:
- Vetting relevant managers and employees.
- Training relevant managers and employees.
- Complying with customer due diligence requirements.
- Reporting suspicious transactions.
- Record keeping.
- Monitoring and managing compliance with, and the internal communication of and training in, those procedures, policies and controls.
- Undertaking certain other activities specified in s57 of the Act.
The Programme must also consider relevant Supervisor guidance.
Once the Company has achieved initial compliance with the Act by producing a Risk Assessment and Compliance Programme, it must meet a number of ongoing obligations. These include:
- Reviewing the Risk Assessment and Compliance Programme to ensure that they remain current and to identify any deficiencies in their effectiveness.
- Filing an annual report on its Risk Assessment and Compliance Programme with the Supervisor.
- Ensuring that the Risk Assessment and Compliance Programme are audited by an independent auditor every two years or at any other time at the request of the Supervisor.
Assistance with these ongoing obligations is not included in this engagement. However, please refer to the section under Further Optional Support in this proposal.
“Anti-Money Laundering Firm of the Year – New Zealand“
Finance Monthly Awards, 2014, 2015, 2016
“Most Outstanding Established Business”
David Awards, 2016
“Most Innovative Business”
David Awards, 2016
“Best Small/Medium Business Of The Year”
Newmarket Business Awards, 2017