In New Zealand, the onboarding process for clients and companies by lawyers involves various identification and Anti-Money Laundering (AML) checks to comply with the Anti-Money Laundering and Countering Financing of Terrorism Act 2009 (AML/CFT Act).
The purpose of the law reflects New Zealand’s commitment to the international initiative to counter the impact that criminal activity has on people and economies within the global community.
To improve New Zealand’s ability to tackle money laundering and terrorism financing, the Government has made law changes that affect various businesses and professions.
The Anti-Money Laundering and Countering Financing of Terrorism (AML/CFT) Amendment Act 2017 puts in place “Phase 2” of New Zealand’s AML/CFT laws.
The new laws:
– extend the current AML/CFT Act to cover more businesses (including real estate agents and conveyancers; many lawyers and accountants; some businesses that deal in expensive goods; and betting on sports and racing)
– make some changes that affect “Phase 1” businesses (including banks, casinos and a range of financial service providers) who have had to comply with the Act since 2013.
Each year about $1.35 billion from the proceeds of fraud and illegal drugs is laundered through everyday New Zealand businesses. These law changes – put in place practical measures to protect businesses and make it harder for criminals to profit from and fund illegal activity.
They’ll also safeguard and help New Zealand live up to our reputation as being one of the least corrupt countries and a good place to do business.
Recent changes to the AML/CFT Act mean that lawyers must comply with its requirements.
Lawyers must do several things to help combat money laundering and terrorist financing, and to help Police bring the criminals who do it to justice. The AML/CFT law does this because the services law firms and other professionals offer may be attractive to those involved in criminal activity.
The law says that law firms and other professionals must assess the risk they may face from the actions of money launderers and people who finance terrorism and must identify potentially suspicious activity.
To make that assessment, lawyers must obtain and verify information from prospective and existing clients about a range of things. This is part of what the AML/CFT law calls “customer due diligence”.
Here are the necessary steps and checks involved in this process.
Individual Clients (KYC Checks)
-Verification of full name and date of birth using documents such as passport or driving license.
-Verify 365 provides digital ID verification using proprietary DynamicID® biometrics technology, ID document checks and database searches, enabling automated and fast client onboarding.
-The verification uses AI for facial recognition and document authenticity checks, and offers a single dashboard for managing verifications.
-Verification of address or proof of ownership, using documents such current bank statements or utility bills.
-Verify 365 provides automated global address validation against official data sources such as the Electoral Roll and Credit Reference Agencies, providing real-time address verification and formatted address outputs.
-The platform provides an option for client document upload and OCR recognition of the documents uploaded as proof of address, or proof of ownership (conveyancing transactions).
PEPs and Sanctions Check:
-Conducting PEPs and sanctions checks is important for lawyers to verify if clients have been sanctioned and/or if a PEP is connected to a company you work with. Being vigilant of who you are dealing with will help your law firm mitigate financial risk and remain compliant.
-Verify 365 provides automated PEPs and Sanction checks with data generation in a constant live state, with real-time risk assessments of over 1,800 global watchlists, PEPs, and adverse media checks.
-Real-time risk screening – using AI, AML/CFT data is verified instantly, with a single alert of all the information needed to make an informed decision, including teams of global data experts that review and edit problematic profiles and high-risk clients.
Source of Funds Check:
-Source of funds refers to the checks that lawyers need to carry out to verify the origin of the funds being used in a particular matter or transaction, as opposed to source of wealth, which refers to finding out about how clients have acquired their wealth.
-Verify 365 platform supports connections to 140+ financial institutions across Australia and New Zealand, covering 99% of the population, including connections to all CDR data holders which enables greater variety and integrity of data sources.
-The platform provides fully automated digital bank statement checks for verifying a client’s source of funds using the most advanced “Open Banking” technology, aiding in compliance with AML regulations.
-Offers a unique source of funds analytics dashboard for real-time monitoring and reporting and provides a summary of “transactions of concern” for enhanced security.
Money laundering is how criminals disguise the illegal origins of their money. Financers of terrorism use similar techniques to money launderers to avoid detection by authorities and to protect the identity of those providing and receiving the funds.
Company Checks and UBO Verifications (KYB)
Identifying and verifying the beneficial ownership arrangements of the company is a key task as per the AML/CFT Act requirements. This includes performing customer due diligence on the company and the beneficial owners of the company.
Company Clients (KYB Checks)
-Know Your Business (KYB) refers to the due diligence review of a business that a lawyer is dealing with. AML regulations require that checks are carried out on any potential business clients to establish its identity and authenticity. This is to help prevent money laundering or terrorist financing activities.
-Verify 365 offers a comprehensive KYB and UBO verification service for purchasing reports on over 500 million companies world-wide based on specific requirements, aiding in informed due diligence.
The platform provides global coverage, comprehensive datasets, real-time screenings, and a cloud-based dashboard for accessing live company data.
Additional Client Onboarding Solutions from Verify 365
Client onboarding solutions help to manage converted enquiries into paying clients. Our software platform works in conjunction with your client and case management software, such as Actionstep, to help streamline the intake process from capturing initial enquiries, scheduling follow-ups, collecting data, verifying details, and signing contracts. With Verify 365, you can take your clients from initial enquiry to opening a case with ease.
Using a digital onboarding platform like Verify 365 is the quickest and most cost-effective way for law firms in Australia and New Zealand to onboard clients and helps to provide a modern and convenient service that exceeds expectations.
Verify 365 client onboarding technology integrates seamlessly with the case management features and secure client portal.
With Verify 365, your law firm can easily capture data, share client care letters for e-signatures, receive identification documents, and share updates within one centralised platform.
Digital ePayments (ePay)
– Verify 365 provides a secure digital payments solution (ePay) within a single client onboarding workflow, reducing risks associated with traditional payment methods.
– Offers real-time e-payment transaction monitoring and provides automated reconciliation and reporting features.
Document eSignatures (eSign)
– Verify 365 provides a platform for electronic signatures (eSign 365), enabling legal documents to be signed quickly on any device.
– Offers features like mobile-friendly signing, signer identity verification, and integration with legal case management systems.
Enhanced Due Diligence Requirements (EDD)
EDD might involve more in-depth checks especially in cases where there is a higher risk of money laundering or terrorist financing, although specific details might vary based on the law firm’s assessment and the nature of the client or company involved.
How does the Verify 365 client onboarding software work with Actionstep?
The easiest, quickest, and most cost-effective way to onboard clients is by using Verify 365 client onboarding solution integration with Actionstep.
Using the integration, your law firm can publish questionnaires to capture data, share client care letters for e-signature, and receive identification documents all from within the secure web portal.
This helps to speed up case progression, provides a convenient service for clients, expands the reach of opportunity for winning clients and positively affects your bottom-line.
Why switch to Verify 365?
Verify 365 offers a variety of KYC and KYB solutions within one single dashboard tailored for legal and financial professionals to stay compliant with AML regulations, streamline their workflow and enhance client onboarding processes.
1- Verify 365 offers advanced biometric and NFC identity verifications, ensuring that your clients are who they say they are.
2- Verify 365 conducts thorough ID checks, including government-issued ID and address verification.
3-AML checks ensure that your clients are not on any financial crime watchlists.
4-Verify 365 perform automated source of funds checks to ensure that the money your clients are using is legitimate.
5-Verify 365 platform also includes e-payment and e-signature technology, making the client onboarding process fast and efficient.
In the competitive landscape of legal compliance platforms, Verify 365 clearly leads the pack, especially in facilitating a more streamlined, secure, and comprehensive approach towards AML compliance for law firms in Australia and New Zealand.