Real Estate Agents

PHOTO: Real Estate Agent. FILE

The Department of Internal Affairs (DIA) has officially cautioned the real estate agency Mills Gibbon and Co Limited in accordance with the Anti-Money Laundering and Countering Financing of Terrorism Act 2009 (AML/CFT Act).

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The Wellington branch of Mills Gibbon and Co Limited fell short of meeting its obligations under the AML/CFT Act, specifically regarding the establishment, implementation, and maintenance of an AML/CFT program. This failure encompassed neglecting to conduct customer due diligence and failing to keep proper records.

The DIA expressed particular concern over Mills Gibbon and Co Limited’s failure to report suspicious activities related to several properties in their listings.

According to the AML/CFT Act, real estate agents are mandated to monitor their customers for any suspicious transactions or activities. If such activities are identified, they are required to report them to the New Zealand Police Financial Intelligence Unit.

In breaching the AML/CFT Act, Mills Gibbon and Co Limited failed in fulfilling its regulatory obligations. It’s important to note that the warning does not accuse the company of involvement in money laundering or financing terrorism. Nevertheless, the company is obligated to promptly address all areas of non-compliance with the AML/CFT Act. The DIA will continue to oversee Mills Gibbon and Co Limited to ensure the enhancement of their practices, policies, procedures, and controls to mitigate the risk of exploitation.

Mike Stone, Director AML/CFT at DIA, emphasized the vulnerability of the real estate sector to money laundering and stressed the necessity for robust processes among real estate agents. He highlighted that the DIA’s AML/CFT Group is dedicated to maintaining the trustworthiness of the real estate sector and will collaborate actively to ensure compliance with the AML/CFT Act.

The warning to Mills Gibbon and Co Limited was formally issued on October 20, 2023, under section 80 of the AML/CFT Act. Despite the breach, the company has shown commitment to improving its AML/CFT program since the DIA identified the non-compliance.