Justice Minister Andrew Little has launched a new campaign to help raise awareness of money laundering in New Zealand, but some say it lacks a clear objective.
The 'Keep Our Money Clean' campaign is about keeping New Zealand's international corruption-free reputation and making sure Kiwi businesses are informed and prepared, according to a Government statement released on Tuesday.
The campaign will run in four phases as new business sectors come under the Anti-Money Laundering and Countering the Financing of Terrorism Act. The previous Government started money laundering regulations because of international agreements New Zealand entered into.
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Now in the second phase of the campaign, the Government is working with real estate agents, lawyers and accountants, alongside banks and casinos, to target money launderers.
From August next year, the campaign will affect the TAB so transactions or bets over a certain amount will be flagged and investigated. What it means is the teller at the TAB can ask for some ID and the TAB has to keep a record of those big transactions.
"The advice that I've had is that there could be up to $5 billion a year in New Zealand being washed through various transactions," Mr Little told The AM Show on Wednesday.
"The original sources of the money are illegitimate and various devices are used to clean it up. We've got to get on top of it. It's part of our international reputation as a safe place to do business," he said, adding that New Zealand's international financial and trade reputation is at risk.
Money laundering involves concealing the transformation of profits from illegal activities and corruption into "legitimate" assets. The dilemma of illegal activities is accounting for the origin of the profits without raising the suspicion of law enforcement agencies.
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Therefore, strategies have been devised to enable the safe use of those profits without warranting suspicion, which is known as money laundering. Once illegally-earned money has been suitably laundered or "cleaned", it can be used in the mainstream economy.
The Government has established new safeguards to keep track of what's happening when there is a pattern of transactions that look suspicious, and then it goes to the police to investigate. For example, if a car dealership suddenly has multiple thousand dollar transactions over a short period of time, that will raise red flags.
The New Zealand Financial Intelligence Unit (FIU) plays a significant role, by collecting, analysing and disseminating financial intelligence relating to suspicious transactions and activities, money laundering and the financing of terrorism.
But the Government has been accused of not providing a clear objective for the new anti-money laundering campaign. AML Insurance's Ron Pol told Newstalk ZB that while there are a "couple of good elements" to it, he said it "lacks a clear policy objective and it mostly is a bit of a confused mishmash".
The new campaign started on Tuesday and will use print and digital advertising, according to Mr Little. He said some customers will be asked for extra information, such as identification, when they're conducting business, which is "how we'll keep our country safe together".