By Charlotte Keesing-Styles, Master of Arts in Criminology
Anti-money laundering and countering financing of terrorism outsourcing companies, such as the TIC Co., play a significant role in protecting businesses against the negative impacts or consequences of money laundering, through supporting them to comply with the relevant legislation.
AML/CFT Act 2009
The Anti-Money Laundering and Countering Financing of Terrorism Act (2009), which mandates businesses to put protective measures in place, sets three main purposes, as below:
to detect and deter money laundering and the financing of terrorism; and
to maintain and enhance New Zealand’s international reputation by adopting, where appropriate in the New Zealand context, recommendations issued by the Financial Action Task Force; and
to contribute to public confidence in the financial system.
These purposes are central and critical to the avoidance of serious crime, New Zealand’s reputation nationally and globally, and the country’s financial and commercial integrity. They are targeted at the reduction of harm at a business level which is undoubtedly a significant and desirable goal.
Impacts of Money Laundering in Your Communities
However, the consequences of money laundering extend far beyond those outlined above. One could argue that the community and societal impacts at both a collective and individual level are the often invisible but harmful outcomes of money laundering activities.
A report from the New Zealand Ministry of Justice in 2011 (Strengthening New Zealand’s Resistance to Organised Crime) states that ‘organised criminal groups are involved across the entire supply chains of the various drug markets, and involved in a proportion or burglary, theft, kidnapping, illegal migration, financial crimes, intellectual property crimes, and environmental crimes’.
The practice of money laundering essentially allows the money from these criminal acts to be ‘cleaned’ to prevent detection. The above report further comments that ‘communities are especially affected through the importation, manufacture, and supply of illegal drugs’.
Drugs and Money Laundering
While money laundering traverses many aspects of society as identified above, to focus on drugs, for example, the impact is felt across many facets of the community. New Zealand’s health, justice, mental health, and welfare systems struggle to manage the effects of drug addiction, including related poverty, unemployment, family harm and community disintegration. It also contributes to intergenerational offending through cycles of poverty and marginalisation, and research indicates that children who have one or more parents in prison are significantly more likely to end up in prison themselves.
Whilst the laundered proceeds of criminal activity create wealth for the few at the top of the system, the impact on New Zealand’s society is widespread. Money-laundering, therefore, is not a victimless crime and nor is its impact observed only at national and financial levels. Conversely, the impact is greatest at the most vulnerable levels of society.
As such, anti-money laundering efforts and legislation are crucial in protecting the wellbeing of all New Zealanders.
Charlotte studied Criminology and Psychology at the University of Auckland, completing her Master of Arts in Criminology in 2014. Her thesis was centered on young women involved in the Criminal Justice System, Restorative Justice, and the New Zealand Youth Justice system. Since then, she has spent the last six years working in the criminal justice field, both in New Zealand and Australia.