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AML due diligence puts clients off

Friday 2nd of October 2015

Under the AML/CFT Act, financial advice businesses that deal in category one products are reporting entities. They must complete a risk assessment of their business, establish and maintain an AML/CFT programme, conduct customer due diligence including identification and verification of identity and report any suspicious transactions.

But Bill Raynel, of Investment Solutions Northland, said it was not always well-received by clients when he asked for identity documents such as passports and driver's licenses.

“I see the look on their faces when I ask for documents. Sometimes it’s such a bother that they throw their hands up.”

He said some felt as if their integrity was being challenged. “It damages the relationship because they don’t like that it seems as if you are questioning their integrity. With older people, who have the lump sums we are looking for, it’s a different world for them. If it is their first experience outside a bank to look at other options they don’t know it exists and it is a bit of a shock for them.”

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