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### Viewing cable 05WELLINGTON950, 2005-2006 INTERNATIONAL NARCOTICS CONTROL STRATEGY

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Reference ID | Created | Released | Classification | Origin
--- | --- | --- | --- | ---
05WELLINGTON950 | 2005-12-12 01:41 | 2011-04-28 00:00 | UNCLASSIFIED | Embassy Wellington

`

    VZCZCXYZ0009
    RR RUEHWEB

    DE RUEHWL #0950/01 3460141
    ZNR UUUUU ZZH
    R 120141Z DEC 05
    FM AMEMBASSY WELLINGTON
    TO RUEHC/SECSTATE WASHDC 2113
    INFO RUEAWJA/DEPT OF JUSTICE WASHINGTON DC
    RUEATRS/DEPT OF TREASURY WASHDC

` `

    UNCLAS WELLINGTON 000950

    SIPDIS

    SIPDIS

    JUSTICE FOR OIA AND AFMLS
    TREASURY FOR FINCEN
    STATE FOR EB/ESC/TFS, INL AND EAP/ANP

    E.O. 12958: N/A
    TAGS: EFIN KCRM KTFN PTER SNAR NZ
    SUBJECT: 2005-2006 INTERNATIONAL NARCOTICS CONTROL STRATEGY
    REPORT, MONEY LAUNDERING: NEW ZEALAND

    REF: STATE 210351

    ¶1.  Below is post's input on New Zealand for the money
    laundering section of the 2005-2006 International Narcotics
    Control Strategy Report (INCSR).  This input also will be
    sent via unclassified e-mail to Ed Rindler, INL/C/CP.

    ¶2. Begin submission:

    New Zealand is not a major regional or offshore financial
    center. Its small number of banks and financial institutions
    can be effectively monitored by government regulatory
    authorities. Although there is evidence that some money
    laundering does take place, it does not appear to be
    significant. Narcotics proceeds and commercial crime are the
    primary sources of illicit funds. International organized
    criminal elements do operate in New Zealand.
    Money laundering is criminalized in New Zealand under two
    laws.  Under the Crimes Act 1961 and Misuse of Drugs Act
    1975, it is illegal to launder the proceeds resulting from a
    serious offense, or to be involved in money laundering
    transactions, if the offender knew or believed that the
    proceeds were derived from a serious offense or a specified
    drug offense.  The acts also apply to a recipient of
    property who was reckless in determining whether it had been
    acquired as the proceeds of a serious offense or a specified
    drug offense.  A serious offense includes any crime
    punishable by at least five years' imprisonment. In
    addition, the Crimes Act criminalizes the receiving of
    property or funds if the recipient knew they had been
    obtained, or was reckless as to whether they had been
    obtained, by any crime.
    The Financial Transaction Reporting Act 1996 contains
    reporting obligations for a wide range of financial
    institutions, including banks, credit unions, casinos, real
    estate agents, lawyers, and accountants. These entities must
    identify clients, maintain records and report suspicious
    transactions.  The Act also requires the reporting of large
    cross-border currency movements and contains a "safe harbor"
    provision, or immunity from civil, criminal or disciplinary
    proceedings for persons reporting suspicious transactions
    and money laundering.
    Proposed legislation, introduced in June 2005 in Parliament,
    would allow the government to freeze or confiscate assets
    generated by crime, even in cases where a person is not
    convicted of a crime but is unable to demonstrate the
    legitimate acquisition of the assets in question.
    The Terrorism Suppression Act, enacted in October 2002,
    criminalizes terrorist financing. This act amended the
    existing law to enable New Zealand to ratify the UN
    International Convention for the Suppression of the
    Financing of Terrorism. The act authorizes the government to
    designate non-UN listed entities as terrorist organizations
    and to freeze, seize and forfeit their assets.  The act,
    which criminalizes the financing of terrorist acts and of
    designated terrorist entities, was amended in June 2005,
    making illegal the intentional financing of non-designated
    organizations that engage in terrorism.   The Prime Minister
    is responsible for designating terrorist entities upon a
    recommendation of the New Zealand Police and in consultation
    with the Attorney General. Once the designation is made, the
    police inform banks and other appropriate parties. A public
    notice is also published. The police and the Crown Law
    Office are developing additional procedures to implement the
    Terrorism Suppression Act's provisions.  New Zealand has
    consistently implemented financial controls against entities
    included on the UN 1267 Sanctions Committee consolidated
    list. No assets from these entities have yet been identified
    in New Zealand.
    Parliament in April 2005 passed the Charities Act, which
    establishes a Charities Commission to register and monitor
    charitable entities.  Registration is not required, but an
    entity must do so to qualify for tax-exempt status.  An
    organization cannot be registered if it is designated a
    terrorist entity or convicted of any offense under the
    Terrorism Suppression Act.
    New Zealand and the United States do not have a Mutual Legal
    Assistance Treaty. However, New Zealand legislation applies
    certain provisions of the Mutual Assistance in Criminal
    Matters Act 1992 unilaterally to the United States. In
    practice, New Zealand and U.S. authorities have enjoyed a
    good record of cooperation and information sharing in this
    area.
    New Zealand is a party to the 1988 UN Drug Convention, and
    in July 2002, ratified the UN Convention against
    Transnational Organized Crime. It signed the UN Convention
    against Corruption in 2003.  New Zealand is a member of the

    Financial Action Task Force, the Asia/Pacific Group on Money
    Laundering, and the Pacific Islands Forum. Its Financial
    Intelligence Unit is a member of the Egmont Group. The New
    Zealand government has played a leadership role in promoting
    efforts to combat money laundering in the South Pacific
    region, providing substantial amounts of technical
    assistance and training to Pacific Island governments.
    The Government of New Zealand has established a
    comprehensive anti-money laundering regime. It should build
    upon this base by continuing its implementation of its
    Terrorism Suppression Act. Additionally, New Zealand should
    continue its recognized leadership in the international
    arena.
    BURNETT

`