Information for customers and the public

To help prevent and combat money laundering, by law some businesses have to ask their customers to confirm who they are and ask questions about their transactions. This helps detect crime and deters criminals from abusing New Zealand’s financial system.

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What is money laundering and financing of terrorism?

Money laundering is how criminals ‘clean’ the money they make from illegal activities such as fraud, drugs and tax evasion.

They launder money so it looks like it comes from a legitimate source, to cover their tracks and avoid being detected. They then spend the money or use it to fund their criminal activities.

People who finance terrorism also use these methods to send money to violent causes and to disguise who is providing and receiving the money.

For more information, see:

What is money laundering and terrorist financing?

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Who does this affect?

The Government has extended the Anti-Money Laundering and Countering Financing of Terrorism (AML/CFT) Act to more businesses including real estate agents and conveyancers; many lawyers and accountants; some high value dealers (like auctioneers, jewellers, and motor vehicle and boat dealers); and betting on sports and racing.

Criminals use some of the services these businesses and professions provide to launder money. Any business that provides these ‘at risk’ services will need to put systems and processes in place to stop criminals from trying to exploit them, and detect suspicious financial activities if they occur.

A business may ask you, as their customer, to confirm your identity. In some circumstances (such as if you’re acting for a company or trust) they may also ask for information about where money came from and the other people involved.

Banks, other financial services providers and casinos already do this, as they’ve had to comply with the AML/CFT Act since 2013.

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How does asking customers for information stop money laundering and prevent crime?

Asking customers basic questions to confirm who they are and about the source of funds discourages criminals from trying to exploit these legitimate businesses. It’s an effective way of shutting down the methods criminals use to launder money.

If businesses notice things that are potential signs of money laundering or financing of terrorism, they need to report that information to Police.

Ultimately, when something’s wrong, it makes it easier for authorities to find out where ‘dirty’ money came from, prosecute criminals, seize illegally earned money and assets, and stop crime.

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When do I have to provide information?

You’ll have to provide identification if:

  • you become a customer or client of a business or professional that’s covered by the Act (for example, when you ask an accountant or lawyer to establish a company or trust for you)
  • there’s a material change in your accounts, financial arrangements or your business relationship with the business (like if the number or type of your transactions change significantly)
  • you pay $10,000 or more in cash to a lawyer, accountant, conveyancer or real estate agent
  • you pay $15,000 or more in cash to a business that trades in high value goods (jewellery, precious metals, precious stones, watches, motor vehicles, boats, art or antiquities)
  • you send $1000 or more overseas.

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What information will I have to provide?

You may have to provide documents confirming your name, birthdate and address, for example:

  • passport; or
  • drivers’ licence and bank card;

    and
  • bank statement or power bill

If you represent a company or trust, you may have to provide extra information like:

  • evidence of who you’re acting for (that is, the beneficial owners who effectively control or benefit from the trust or company). For more information, go to:

    Beneficial ownership guideline (external link)
  • where and who the money came from.

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What happens if I can’t provide the information?

The business or professional may not be able to complete your transaction.

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What will the business do with the information?

The business or professional will keep a secure record of your information, in the same way they already keep other customer information about you.

If they notice something that’s a potential warning sign of money laundering or financing of terrorism, by law they must report it to Police (although this is optional for businesses that deal in high value goods).

The Police Financial Intelligence Unit (FIU) will then analyse the information you provided and other relevant details about the transaction or activity to decide which situations need to be referred to investigative branches of Police or other agencies.

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