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.

  1. 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.
  2. 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.
  3. You are also likely to have AML/CFT obligations if you carry out transactions with customer funds or directly manage client assets.