Anti-money laundering law extension balances cost to businesses: Adams
Lawyers, conveyancers, accountants, real estate agents, and sports and racing betting are now subject to money laundering legislation after it was fast-tracked in the fallout from the Panama Papers last year.
The second phase of the Anti-Money Laundering and Countering Financing of Terrorism Act was introduced by Justice Minister Amy Adams on Monday.
Banks, casinos and financial service providers were already covered, but the amendment extended the law to cover more professions.
This move was accelerated last year after the release of the Panama Papers and the Government launching the Shewan Inquiry into New Zealand's foreign trust regime.
Adams said businesses which dealt with certain high-value goods, such as motor vehicles, jewellery and art, would also have obligations under the law.
"Money laundering allows criminals to fund their lifestyle and it fuels re-investment in criminal ventures.
"Extending the law will improve our ability to prevent, detect and prosecute many types of criminal activity and help protect New Zealand's reputation as a good place to do business."
Adams said the amendmant struck a balance between combating crime, meeting international obligations, and minimising compliance costs.
Compliance costs had falling from an estimated $1.6 billion over 10 years to between $800 million and $1.1b following work with the affected sectors.
Businesses would also be given time to prepare for the changes, she said.
The law was estimated to disrupt up to $1.7b in fraud and drug crime over the next decade.
"Estimates also suggest they may prevent up to $5b in broader criminal activity and reduce about $800m in social harm related to the illegal drug trade."