If you operate a financial services business in New Zealand that falls within the definition of a reporting entity under Part 1 section 5 of the Act you will need to comply with the AML/CFT Act. In general, if you help people invest their money you are likely to have obligations under the AML/CFT Act. A business that has obligations under the AML/CFT Act is a ‘reporting entity’.
There are 3 broad situations where AML/CFT obligations are likely to apply within financial services.
- If you are an authorised financial adviser you will probably have AML/CFT obligations when you advise a customer to buy certain financial products and then act as an intermediary for the purchase of these products from product providers.
- You may still have AML/CFT obligations even if you are exempt from the requirements to become and authorized financial adviser because you only provide advice to wholesale customers.
- You are also likely to have AML/CFT obligations if you carry out transactions with customer funds or directly manage client assets.