In June 2016, the Prime Minister and Minister of Justice
announced that the government would fast track changes to introduce
Phase 2 of the Anti-Money Laundering and Countering Financing of
Terrorism Act (Act).
Phase 1 of the Act came into effect in 2013 and requires
organisations such as banks and casinos to conduct customer due
diligence. A number of people may through their own personal
experiences with their bank, be familiar with the requirements
which are to:
Obtain and verify the identity of customers
In some circumstances, verify sources of funds
Conduct ongoing customer due diligence and monitor account
Identify and report any suspicious activity
Phase 2 involves extending the Act to cover other professions
such as lawyers, accountants and real estate agents.
Submissions on a consultation paper in relation to the proposed
changes have been sought and the Government aims to introduce a
Bill to Parliament before Christmas. The Ministry of Justice has
indicated that the Bill will be passed into law by July 2017.
The impact of the coming changes means that we will be required
by law to:
conduct a higher level of due diligence on our clients
including obtaining identification in a wider range of
circumstances than we do currently
verify the source of client funds
report any transactions that may be suspicious to the
In addition, lawyers will be subject to the supervision,
monitoring and enforcement provisions of the Act. Who will regulate
the legal profession is yet to be announced.
We will provide further updates when the Bill is released and
how this may affect the type of information we may be compelled to
obtain from our clients.
If you have any questions please get in touch with our experts
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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