CDD - General AMLHub Frequently Asked Questions

The Quick Reference Guide can be found here.

You must conduct CDD in the following circumstances:

1. When you establish a business relationship with a new client for a captured activity.
2. A client seeks to conduct an occasional transaction or occasional activity through you.
3. In relation to an existing client, and according to the level of risk involved:
• There has been a material change in the nature or purpose of the business relationship; and
• you consider that you have insufficient information about the client.
4. As soon as practicable after you become aware that an existing account is anonymous.

Commercial leasing is a captured activity and you will be required to complete CDD on the leasor as you would for a vendor. Where acting for the leasee, you will also need to conduct CDD (much like you would need to when acting as a buyer’s agent) on the leasee.

To comply with your responsibilities under the Act, it would be prudent to conduct CDD on all clients with current/active listings as at 1 January 2019 regardless of when the listing agreement was signed.

Money laundering describes the process by which criminals make ‘dirty’ money obtained from their criminal activities look legitimate, or 'clean'.

They aim to make this dirty money look like it has come from a legitimate source, and therefore difficult to connect with its criminal past. Once this has been achieved, criminals can introduce their dirty money into the financial system undetected.

From there, the money can be transferred between bank accounts, asset classes or financial products in New Zealand or abroad, or used to purchase goods and services.

Terrorist financing is the financial support of terrorists or those who encourage, plan or engage in terrorism. Terrorist financing may involve funds raised from legitimate sources, such as personal donations and profits from businesses and charitable organisations. It may also be drawn from criminal sources, such as the drug trade, the smuggling of weapons and other goods, fraud, kidnapping and extortion. People who finance terrorism often use similar methods and tools to those used for money laundering.

The IVCOP provides suggested best practice for all reporting entities, conducting name and date of birth identity verification on customers (that are natural persons) assessed as low to medium risk. You can find a copy of the IVCOP on the AML Solutions or DIA’s website

Identification involves obtaining information from the customer about their identity. Verification involves confirming this information using documents, data or information from reliable and independent sources.

Where you do not meet a client face to face and sight their identity documents, you will need to obtain certified identity documents.

Most commonly we see the following types of trusted referees utilised:

1. Lawyers;
2. Chartered Accountants; and
3. Justice of the Peace.

For a full listing of all trusted referees, refer to your AML/CFT Compliance Programme or the Amended Identity Verification Code of Practice 2013 on the AML Solutions or DIA's website.

1. related to the client (e.g. cannot be a parent, child, brother, sister, aunt, uncle or cousin);
2. the spouse or partner of the client;
3. a person who lives at the same address as the client; or
4. a person involved in the transaction or business requiring the certification e.g. the lawyer who is doing the conveyancing.

When certification occurs overseas: copies of international identification provided by a client residing overseas must be certified by a person authorised by law in that country to take statutory declarations (or equivalent in the client’s country). You will need to research the relevant country to determine this.

You will need to ensure you receive the original (wet ink) certified copies of the identity documents.

Any employee or contractor (for example admin staff and sales agents) of your agency can verify identity documents, as long as they have been appropriately trained to do so.

You may also enter into contractual arrangements to allow third parties to do this on your behalf. If you enter into such an arrangement, your AML/CFT Compliance Programme will need to be updated accordingly.

To manually verify you must meet the client face to face and record that it is a true copy.

On the AMLHub we do this by uploading images via the application.

If not using the AMLHub app, we recommend putting in place the following stamp for staff to utilise when verifying documents manually (outside of the AMLHub application). The stamp would state:

1. For photographic identification documents – “I verify that this is a true copy of the original document, which I have personally sighted; and the photograph is a true likeness.”
2. For all other identification documents – “I verify that this is a true copy of the original document, which I have personally sighted.”

You may choose not to have a stamp and instead hand write the above - this would be acceptable.

Where the agency does not meet the customers face-to-face, certified copies will need to be obtained for any ID documentation collected for a customer. You should refer to the Code of Practice for a list of trusted referees.

A scan of a certified copy of an identity document that is emailed to you is not acceptable for CDD purposes. This is because it could easily have been falsified or tampered with prior to being emailed to you. You will instead need to collect the original certified copy (the wet ink copy).

While the expectation is that current and valid documents will be collected to confirm a clients identity, exceptions to CDD policy are acceptable on a risk based approach. Your firm will need to determine what if any if any exceptions are acceptable, and how these will be managed. We note that a number of reporting entities have elected to accept expired documents (no more than 2 years expired generally) for low risk clients such as the elderly.