David Hyland
Real Estate, Practice Leader
As of 1 January 2019, Phase Two of the Anti-Money Laundering and Counter Financing of Terrorism Act 2009 (AML/CFT) has come into effect.
The nature of the Real Estate industry makes it attractive for criminals to conceal the proceeds of crime because it provides a veneer of legitimacy to criminally obtained funds. The AML/CFT intends to detect and therefore reduce the number of offenders who use the profession for money laundering to finance terrorism. It is estimated by the New Zealand Police Financial Intelligence Unit (FIU) that the value of financial fraud in New Zealand is $1.35 billion[1], although experts believe the actual transactional value is several times higher.
Real Estate companies should be familiar with the activities which indicate whether an entity is deemed to be a “reporting entity” under Section 5(1) of the AML/CFT. These activities include:
In addition to the above, we have outlined below a number of ‘red flags’ that should raise suspicion:
Get in touch with us to find out how Marsh’s Specialty Practice can assist with real estate risk management and provide insurance solutions that can protect businesses against potential legal liabilities.
[1] The Department of Internal Affairs Website
Disclaimer: Statements concerning legal matters should be understood to be general observations based solely on our experience as insurance brokers and risk consultants and should not be relied upon as legal advice, which we are not authorised to provide. All such matters should be reviewed with your own qualified legal advisors. The information contained in this publication is based on sources we believe reliable, but we do not guarantee its accuracy. This information provides only a general overview of the subjects covered.
Real Estate, Practice Leader