High Value Dealers are making it harder to cash in on crime

4 July 2019 

High value dealers can be targeted by criminals to turn cash into assets. This allows them to disguise the illegal origins of their money. Cash held by criminals can come from crimes such as drug dealing, fraud, tax evasion or converting stolen property. 

Dealers of high value goods that might be affected include bullion dealers; jewellers, precious metal and stone dealers, motor vehicle and ship dealers, antique and art dealers, and other businesses that accept or provide large amounts of cash for certain types of goods. 

Every year about $1.35 billion from the proceeds of fraud offending and illegal drugs is laundered through New Zealand businesses. The true cost and social impact is much higher.

To make it harder for criminals to use cash anonymously to buy or sell high value goods, the Anti-Money Laundering and Countering Financing of Terrorism Act 2009 (AML/CFT Act) will cover high value dealers from 1 August 2019. This applies to high value dealers who buy or sell goods using cash transactions at or over $10,000. 

Cash includes NZD and foreign currency as well as any type of cheque (bank, personal, travellers), promissory notes, bills of exchange, bearer bonds, money orders, postal order or similar orders. 

The Department of Internal Affairs is the AML/CFT supervisor for dealers of high value goods. We are also the AML/CFT supervisor of some financial institutions, casinos, trust and company service providers, lawyers, conveyancers, accountants and real estate agents. It is important to note high value dealers will have fewer obligations under the AML/CFT Act than other businesses that we supervise.

An easy way for criminals to use their cash

“Cash will always be popular for criminals. It is anonymous, it’s hard to trace and it can be used outside of formal financial institutions. We want to work with high value dealers to help protect their business from being unwittingly taken advantage of by criminals. The aim is to strengthen the overall AML/CFT system,” said Mike Stone, Director of the Department’s AML Group. 

From 1 August high value dealers that deal in cash transactions of $10,000 or over will need to verify customers’ identities. The cash threshold applies to a single transaction or a series of related transactions that add up to $10,000 or more. Records of the customer’s identity and the verification documents must be kept. 

High value dealers will also need to submit transaction reports to the NZ Police Financial Intelligence Unit (FIU) and have an audit of their business conducted if requested by DIA. High value dealers may report activity or transactions that appear suspicious to the FIU.

“The effectiveness of New Zealand’s anti-money laundering -system is dependent on all businesses playing an active role so that criminals are detected and deterred from using their products and services to conceal their illegal funds.”

More information and guidance for high value dealers is available on the DIA website. 

Ends 

Media contact:  

Department of Internal Affairs Media Team 

027 535 8639