Guidance Updates: Sector Risk Assessments

13 February 2020

We have recently published two Sector Risk Assessments:

These Sector Risk Assessments (SRAs) replace the previous Phase 1 and Phase 2 SRAs published in 2017 and 2018. The name changes reflect that the implementation of Phase 2 of New Zealand’s AML/CFT regime is now complete.

Important: In addition to the name changes, there have been some updates to the risk assessment content. Reporting entities should consider whether they need to review and update their own risk assessments and AML/CFT programmes:

1.      Updates relating to terrorism financing (TF) risks

  • Updates to the terrorism financing issues sections - Part 21 of the SRA for Financial Institutions and Part 14 of the SRA for DNFBPs and Casinos.
  • This reflects updates to the National Risk Assessment (NRA) 2019 (PDF, 488KB) relating to TF risk in New Zealand.
  • All reporting entities should consider whether it is necessary to update their own risk assessments and AML/CFT programmes relating to TF risks. 

 2.      Addition of Virtual Asset Service Provider (VASP) Sector

  • The VASP sector has been included in the SRA for Financial Institutions.
  • The VASP sector has an inherent ML/TF risk rating of High.
  • This content is relevant for VASPs, as well as other reporting entities that interact with them.

3.      Conveyancing sector inherent ML/TF risk rating

  • The inherent ML/TF risk rating for the conveyancing sector has changed from Low to Medium.
  • This change follows a review of DIA’s methodology and increased understanding of the ML/TF typologies they face.

Financial Institutions previously covered in the 2018 Phase 1 SRA should now refer to the SRA for Financial Institutions (PDF, 1.7MB).

Below is a list of those covered by this SRA:

  • money remitters
  • currency exchangers
  • payment providers
  • nonbank non-deposit taking lenders (NBNDTLs)
  • non-bank credit cards
  • stored value cards
  • tax pooling
  • cash transport
  • debt collection
  • factoring
  • financial leasing
  • payroll remittance and
  • safe deposit boxes
  • virtual asset service providers

All other types of reporting entity (including trust and company service providers and casinos) should now refer to the SRA for Designated Non-Financial Businesses or Professions (DNFBPs) and Casinos (PDF, 1MB).

Below is a list of those covered by this SRA:

  • lawyers
  • accountants
  • conveyancers
  • real estate agents
  • trust and company service providers (TCSPs)
  • Casinos
  • high value dealers (HVDs)
  • Racing Industry Transition Agency (RITA), formerly known as the New Zealand Racing Board (NZRB)

If you have any questions please visit the contact us webpage.

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