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New software to weed out dodgy clients

Advisers will be able to check their clients against global money-laundering and terrorism watchlists at the click of a button, thanks to new software being brought to New Zealand.

Tuesday, November 6th 2012, 6:19AM

by Niko Kloeten

Australian IT firm Neurocom offers a software program called Membercheck, which allows advisers and other firms to scan their clients against watchlists compiled by Dow Jones featuring more than 600,000 names.

Under New Zealand’s anti-money laundering legislation, reporting entities including Authorised Financial Advisers are required to perform enhanced due diligence on overseas PEPs (politically exposed persons) including close relatives and associates of politicians. 

Enhanced due diligence includes having to find out the source of the funds being invested.  The law doesn’t require this for local PEPs.

However, getting access to lists compiled by the likes of Dow Jones can be difficult and prohibitively expensive for reporting entities at the bottom of the chain, according to Neurocom chief executive Ross Edenborough.

Australia has had its own anti-money laundering regime in place for five years and Edenborough said Membercheck was developed in response to demand from small-to-medium-sized reporting entities for a more cost-effective way to comply with their obligations.

“What we found when it came in to Australia was that the big banks had been doing this stuff for a long time… they take a feed from Dow Jones directly.

“For any reporting entity that has these requirements the only way to access a list is to buy one in some way and it’s typically very expensive… it can cost about $100,000 a year depending on the size of the company.”

Edenborough has been in New Zealand recently consulting with several adviser industry groups and recently spoke at the SIFA conference.

He said the pricing structure hadn’t been decided yet but indicated that for small AFA businesses it would likely cost about $500 a year “to go through a process where you know you won’t upset the FMA.”

Although many AFAs consider their clients to be low-risk, Edenborough said it can difficult to be sure without checking.    

“One of your AFAs mentioned Kim Dotcom and I’d never heard of him but we ran a check on him and it came up with all sorts… he had a very extensive profile.”

Niko Kloeten can be contacted at niko@goodreturns.co.nz

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Lender Flt 1yr 2yr 3yr
AMP Home Loans 6.99 5.99 6.29 6.60
AMP Home Loans $200k+ 6.89 5.89 6.19 6.50
AMP Home Loans LVR <80% - - 5.85 6.29
ANZ ▲6.74 6.05 6.49 6.65
ANZ LVR > 90 ▲6.74 6.55 6.99 7.15
ANZ Special - - 6.09 -
ASB Bank ▲6.75 6.09 6.40 6.65
ASB Bank Special - 5.95 - -
BankDirect ▲6.75 6.09 6.99 6.65
BankDirect Special - 5.95 - -
BNZ - Classic - - - 6.25
Lender Flt 1yr 2yr 3yr
BNZ - GlobalPlus ▲6.74 5.99 6.39 6.59
BNZ - Mortgage One ▲7.15 - - -
BNZ - Rapid Repay ▲6.74 - - -
BNZ - Std, FlyBuys ▲6.74 5.99 6.39 6.59
BNZ - TotalMoney ▲6.74 - - -
Credit Union Auckland 6.70 - - -
Credit Union Baywide ▲6.45 5.90 6.50 -
Credit Union North 6.45 - - -
Credit Union South 5.75 - - -
eMortgage 6.04 6.15 6.69 7.19
Finance Direct 6.10 6.45 6.69 7.10
Lender Flt 1yr 2yr 3yr
First Credit Union 6.45 - - -
General Finance 5.95 6.25 6.50 7.10
HBS Bank 6.15 5.85 6.20 6.25
HBS Special - - - 5.95
Heartland 6.45 6.75 7.00 7.60
Heretaunga Building Society 6.25 5.85 6.50 -
Housing NZ Corp 6.50 6.00 6.30 6.60
HSBC Premier 6.59 5.95 5.99 6.25
HSBC Premier LVR > 80% - - - -
HSBC Special - 5.85 5.85 5.85
Kiwibank 6.40 5.99 6.29 6.29
Lender Flt 1yr 2yr 3yr
Kiwibank - Capped 5.65 6.50 - -
Kiwibank - Offset 6.30 - - -
Kiwibank LVR > 80% - - 5.85 6.29
Liberty 5.64 - - -
Napier Building Society 5.80 6.00 6.70 -
Nelson Building Society ▲6.95 ▲6.15 6.60 -
NZ Home Loans 6.35 6.09 6.40 6.65
Perpetual Trust 7.70 - - -
RESIMAC - lo doc 7.34 7.06 7.38 7.82
RESIMAC LVR < 80% 6.34 6.06 6.38 6.82
RESIMAC LVR < 85% 7.34 7.06 7.38 7.82
Lender Flt 1yr 2yr 3yr
RESIMAC LVR < 90% 8.34 8.06 8.38 8.82
SBS Bank 6.15 5.85 6.20 6.25
SBS Bank Special - - - 5.95
Silver Fern 5.95 6.10 6.55 7.05
Sovereign ▲6.85 6.09 6.40 6.65
Sovereign Special - 5.95 - -
The Co-operative Bank 6.45 6.00 6.00 6.25
TSB Bank 6.49 6.00 6.19 6.60
TSB Special - - 5.80 -
Wairarapa Building Society 6.20 5.75 5.95 -
Westpac 6.24 6.09 6.39 6.65
Lender Flt 1yr 2yr 3yr
Westpac - Capped rates - 6.49 6.99 -
Westpac - Offset 6.24 - - -
Westpac Special - 5.95 6.09 -
Median 6.45 6.00 6.39 6.60

Last updated: 28 July 2014 7:01am

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