01 Oct 2019
A company and two employees are on trial accused of failing to report hundreds of “suspicious” transactions involving tens of millions of dollars belonging to an international mogul.
It is understood to be the first such criminal case to be heard in New Zealand’s courts since specific anti-money laundering laws were introduced a decade ago.
The company and the duo – all of which cannot be identified for legal reasons – are charged with failing to conduct customer due diligence, failing to keep adequate records and structuring a transaction to avoid Anti-Money Laundering and Countering Financing of Terrorism Act (AML/CFT) requirements.
It is alleged some 311 transactions totalling more than $53m were conducted in 2016 for the mogul, who prosecutors claim was a customer of the New Zealand company.
Much of the money is said to have been sourced from a pyramid scheme, Crown prosecutor Sam McMullan told the High Court at Auckland today.
The money, he alleged, was “intentionally concealed” by the financial company, while being “aided” by the accused pair – a man in his 30s and woman in her 60s.
The alleged actions of the company and duo displayed a “flagrant disregard” for their legal obligations under the AML/CFT, McMullan said.
He added New Zealand’s financial reputation relied on the robust processes of the AML/CFT to protect it from the risks of those seeking to launder funds.
The court heard the company may argue in its defence that the mogul was not one of its customers but the customer of the female employee.
McMullan, however, said having customers linked to employees rather than an entity could be seen a tactic to potentially shield suspicious individuals.
But, he said, the Crown accepted the mogul’s primary contact was the individual employee, who is accused of conducting the majority of the transactions and structuring transactions through a bank.
A shell office in Auckland was also kept for the sole benefit of the mogul, McMullan alleged.
David Jones QC, who is acting for the company and man, said the trial was a test case and the first prosecution of its kind in New Zealand.
He said the elephant in the room was the identity of the mogul.
By Sam Hurley, New Zealand Herald, 1 October 2019
Read more at New Zealand Herald
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