Anti-money laundering legislation sets out minimum requirements only, which can be exceeded

Change of identification requirements

Mark used a money transfer service, International Transfer Limited (“ITL”), to transfer amounts overseas on a reasonably regular basis. ITL told Mark that he would need to provide original proof of address every 90 days to keep his account status with ITL as ‘active’.

Mark complained that he had already provided a copy of his passport and bank statement 2-3 months previously. Mark said it was not feasible for him to go to ITL’s office and provide original proof of address every 3 months. Mark said he had offered to provide a photocopied proof of address every 3 months, but ITL said it would not accept this.

ITL told Mark that there was no rule or law that Mark was required to provide original proof of his address every 3 months, but that ITL had implemented a policy that required this. Mark said that ITL’s requirements exceeded those required under the Anti-Money Laundering and Countering Financing of Terrorism Act 2009 (“the AMLCFT Act”), and that it should accept photocopied proof of address from him.

 

Review

Under paragraph 8.2 of FSCL’s terms of reference, our CEO can decline to investigate a complaint if it is about a participant’s practice or procedure. FSCL can investigate complaints which allege maladministration or inappropriate application of a practice or policy, or a breach of the law.

We outlined to Mark that the coming into force of the AMLCFT Act in 2013 changed the requirements on financial service providers to verify its customers’ identification. One of the purposes of the AMLCFT Act is to bring New Zealand’s AMLCFT regime into line with international best practice and to better protect the public as a whole from the effects of financial crime.

We further outlined that the AMLCFT Act sets out minimum requirements on financial service providers to confirm the identity of their customers. We noted that ITL had made a decision to require identification information in excess of the minimum requirements. We told Mark it was not a breach of the law for ITL to do this.

We suggested that if Mark remained unsatisfied with ITL’s service he had the option to use another company to provide money transfer services.

Mark was not happy with our decision to decline jurisdiction to investigate his complaint. However, he was unable to provide us with any further information which would cause us to alter our view and we closed the investigation of his complaint.