PHOTO: Department of Internal Affairs. RNZ
Formal Warning Issued to Hills Real Estate Limited for Anti-Money Laundering Non-Compliance
Te Tari Taiwhenua (Department of Internal Affairs) Issues Warning to Hills Real Estate Limited
The Te Tari Taiwhenua (Department of Internal Affairs), also known as DIA, has officially issued a formal warning to Hills Real Estate Limited (trading as Hills) for non-compliance with the Anti-Money Laundering and Countering Financing of Terrorism Act 2009 (AML/CFT Act).
Hills Real Estate Limited has been found to have failed in meeting its obligations under the AML/CFT Act, specifically regarding the establishment, implementation, and maintenance of an AML/CFT program. Additionally, the DIA discovered that Hills failed to conduct ongoing customer due diligence, monitoring, and reviews to identify suspicious activities that may require reporting, as well as neglecting to maintain records in accordance with the AML/CFT Act requirements.
Immediate action is required from Hills to rectify all areas of non-compliance, and the company will be closely monitored by DIA officials to ensure compliance going forward.
This formal warning to Hills represents the second such warning issued by the DIA to a real estate agent within the past two months.
“When instances of non-compliance are identified, the DIA has a range of regulatory tools at its disposal, including educational guidance, formal warnings, and, depending on the severity and scale of the breaches, prosecution,” says Mike Stone, Director of the AML/CFT Group at the DIA. “Real estate agencies should take note of these recent warnings and anticipate stronger actions from the DIA in the future for serious violations of the AML/CFT Act.”
Evidence suggests that criminals are utilizing the New Zealand real estate market to launder significant amounts of illicit funds. In the fiscal year ending June 2021, the New Zealand Police seized 100 properties, totaling NZD 73.7 million, an increase compared to the previous year’s seizure of 51 properties amounting to NZD 55.7 million.
By exploiting legitimate property transactions, criminals can conceal their illegal funds and introduce them into the market. Real estate agents play a crucial role in preventing this by adhering to AML/CFT regulations.
The AML/CFT Group at the DIA is committed to ensuring that the New Zealand public can trust the integrity of the real estate sector through the regulation and monitoring of real estate agents under the AML/CFT Act.
The AML/CFT Act was enacted to establish a robust system for detecting and deterring money laundering and the financing of terrorism, while simultaneously preserving and enhancing New Zealand’s international reputation and fostering public confidence in the financial system.
The formal warning to Hills Real Estate Limited was issued on May 8, 2023, under section 80 of the AML/CFT Act.
SOURCE: Department Of Internal Affairs