Associate Minister of Justice, Nicole McKee.
Photo: RNZ / Samuel Rillstone

The government says it is reforming anti-money laundering laws to help small businesses.

Associate Justice Minister Nicole McKee said current anti-money laundering legislation, which requires financial service providers to report all domestic transactions worth more than $10,000 to the police, was too complicated.

Reform work has been approved and will streamline the law for businesses, police and the public, she said.

“The reforms will address a key government priority of cutting red tape and improving the quality of regulation.

“My aim is to provide regulatory relief to businesses and the public, enabling law enforcement to crack down on organized crime and ensuring New Zealand maintains its international reputation.”

Current regulations hurt small businesses that can’t afford to have dedicated compliance teams, McKee said. The reforms would provide “the most significant regulatory relief” since the Anti-Money Laundering and Counter-Terrorism Financing Act came into force 11 years ago.

“The reforms will be undertaken in three parts. The first part is already well advanced and will provide immediate relief via two bills – the first of which, the Statute Amendment Bill, has already been presented to Parliament.

“The second part will focus on structural changes and a sustainable financing model, to create a more effective and efficient system. The final part will make additional regulatory changes to implement international standards and establish a more system-based on risks.”

ACT campaigned to make anti-money laundering compliance “small business friendly”, McKee said.

“I’ve heard from countless New Zealanders that current regulations are unnecessarily risk-averse, resulting in complicated and repetitive processes. Simple tasks must not be made confusing and difficult to complete.”

McKee said she was taking a “pragmatic approach” to ensuring New Zealand still meets the standards set by the Financial Action Task Force.

“Compliance with these standards is important to protect our economy and our international reputation.”