Auckland-based foreign exchange business has been fined 7 770,000 for violating anti-money laundering laws.
High Court Judge Rebecca Edwards said, “Given the scale, nature and circumstances of non-compliance with the KVB (CLSA Premium), I am satisfied that it reflects the accuracy and prevention of penalty violations. And reflects the principles of condemnation. ” In auckland
CLSA Premium, also known as KVB Kunlam New Zealand, admitted that it had failed to comply with anti-money laundering laws, which allowed money laundering by thugs and terrorists between April 2015 and November 2018. Made to stop.
Edwards found that two anti-money laundering compliance managers at CLSA Premium resigned in frustration after trying to do their job because there was a legal hurdle required by the company’s directors.
* The Financial Markets Authority issued a warning against money laundering.
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* The FMA takes CLSAP NZ to court for alleged anti-money laundering violations.
Edwards said, “One of the directors’ statement that a ‘Binder’ compliance officer is needed is particularly relevant.
This director was not named.
Edwards concluded that CSLA Premium preferred to keep the business of the wealthiest consumers above its legal obligations to prevent money laundering.
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“The correspondence for a customer indicates that in view of the refusal to provide the information requested by the customer, KVB was prepared to accept insufficient information, including reasonably suspicious information, so that the customer’s business To be maintained. “
The company later pleaded guilty. Action taken by the Financial Markets Authority Celebrate Tatai Hokuhoku (FMA).
The $ 770,000 fine is a significant mark as the CLSA premium case represents the first litigation brought by the FMA under the AML / CFT Act.
The case focused on transactions made through a sample of 10 different super-rich CLSA Premium NZ customers.
These included approximately 49 49.49.5 million in transactions, of which .8 40.8 million was related to deposits of only two customers.
It turned out that FMA’s 10 richest clients were selected after a tip-off in which a “third party” passed information to the regulator about three specific CLSA premium clients.
The company acknowledged failing to properly investigate money laundering, including gathering evidence of where its customers’ money came from.
It also did not end its business dealings with customers who refused to provide the required information.
It failed to report suspicious transactions on nine occasions, and failed to keep records under anti-money laundering laws.
This all happened when CLSA Premium NZ was warned by the FMA in 2014 about its substandard anti-money laundering program. In 2018, the FMA said it was still not fulfilling its legal obligations.
Edwards found that in 2017 the company’s directors suspended the collection of information on clients’ wealth sources.
“These features together indicate that KVB’s reasonable prudent non-compliance was not unintentional. It was not caused by any misunderstanding of its responsibilities, or as a result of misguided advice,” Edwards said.
“We welcome this decision because it sends a strong message that there are serious consequences for firms that prioritize profits over needs under the AML / CFT government,” said Karen Chang, FMA’s chief executive.
“It’s important for firms to take their compliance responsibilities seriously, to make sure they not only have the right programs, but also have staff follow them,” Chang said.
The directors of CLSAP New Zealand at the time were Rongjin (June) Zhang, Songwian Huang (Benny Wong), Stephen Liu, Robert Manuring Novex and Richard Clive Pearson.
The director was not a party to the proceedings.
CLSA Premium NZ is part of a multinational group of companies based in Hong Kong.
The company’s website claims that it has received certificates of compliance from the Financial Supervision Commissions regarding our credit and professionalism in the region of Australia, New Zealand and Hong Kong.
David Wallace, chairman of CLSA Premium NZ, said the company has undergone significant, sweeping changes over the past two years to completely transform the company and ensure high standards of ongoing compliance.
“The company’s practice and culture has changed completely since the time of these violations. We are very serious about following both the letter and the spirit of our responsibilities,” Wallace said.
He said the company has independently reviewed its compliance program, appointed new external auditors to the BDO, Grant Thornton and Strategy, and fully implemented their recommendations.