AML/CFT Reminder – Pandora Papers

Return to AML/CFT News and Information

20 October 2021

Recent media reporting regarding the “Pandora Papers” has once again cast a spotlight on the ways that legal persons and legal arrangements can be used to hide wealth and reduce tax liability, and allegedly in some cases, evade tax or launder money.

The Pandora Papers are a timely reminder that reporting entities that form legal persons and legal arrangements, or arrange or act as nominee directors, nominee shareholders or trustees are at risk of being misused for money laundering. All trust and company service providers (TCSPs), law firms and accountants that provide these services must have effective AML/CFT programmes to manage and mitigate these risks.

Under the AML/CFT Act, you are required to conduct ongoing monitoring of business relationships with your customers. For higher risk customers, transactions or activities, you are required to obtain and verify information regarding the source of wealth or funds of the customer. This is mandatory when establishing a business relationship with a customer that is a trust. Reporting entities must also report all suspicious activities or transactions to the New Zealand Police Financial Intelligence Unit (FIU). This includes activities or transactions that raise suspicion of tax evasion, which is a predicate offence to money laundering. A report must be submitted to the FIU no later than three working days after reasonable grounds for suspicion are formed.

To be able to report suspicious activities or transactions, you need to be registered with the FIU’s goAML system. If you are not already registered for goAML, you can register here: New Zealand Financial Intelligence Unit (FIU) online reporting facility

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