NZForex Limited — 3,182 Unreported PTRs
Lan’s Enterprise Limited Training Program
Presented by: Angela Ji
Contact: aml@gmfinance.co.nz
Emergency Hotline: +64 09-309-8808
Overview
- DIA issued a formal warning to NZForex Limited on 18 March 2025
- 3,182 prescribed transactions were not reported to the FIU
- Reporting gap spanned 1 November 2017 → 28 February 2024 — over six years
- All unreported transactions were non-NZD denominated
- No allegation of money laundering — this was a system / reporting-control failure
Who is NZForex?
- Online foreign-exchange and international payments business
- Reporting entity under the AML/CFT Act 2009
- Required to file:
- International Funds Transfers (IFTs) ≥ NZ$1,000 cross-border
- Large Cash Transactions (LCTs) ≥ NZ$10,000 in cash
- Collectively known as Prescribed Transaction Reports (PTRs)
What Went Wrong
The system issue
- A defect in NZForex’s PTR processing pipeline
- Affected transactions not denominated in New Zealand Dollars
- Non-NZD volumes silently bypassed the reporting workflow
- The defect persisted for 6 years and 4 months undetected by internal monitoring
What was missed
- 3,182 individual prescribed transactions
- Each was a separately reportable obligation under section 48A
How It Was Discovered
- NZForex itself identified the issue
- The defect surfaced through internal system review — not a DIA finding
- NZForex voluntarily disclosed the non-compliance to DIA
- Backfill: all 3,182 transactions were submitted to the FIU
- An independent audit was commissioned voluntarily
The Regulator’s Position
“DIA acknowledges that NZForex has voluntarily disclosed the non-compliance, and we commend NZForex for disclosing the non-compliance, admitting fault and taking steps to resolve the system issue.”
— Serge Sablyak, Director Anti-Money Laundering, DIA
- Voluntary disclosure → formal warning rather than civil penalty
- Independent audit → satisfies “verifiable remediation” test
- The regulatory mitigation pathway is public, predictable, and used
| Factor | Effect |
|---|
| Voluntary self-disclosure | Strong mitigant |
| No money-laundering allegation | Strong mitigant |
| Backfill of all 3,182 PTRs | Strong mitigant |
| Independent audit (voluntary) | Strong mitigant |
| Six-year duration | Aggravating |
| Volume (3,182) | Aggravating |
The mitigants outweighed the aggravators — but it took proactive action to get there
Why This Matters to LEL
We file the same PTRs
- LEL is a money remitter operating across multiple currencies
- Our PTR pipeline must capture every reportable obligation, every currency, every time
- A silent reporting gap is the most common DIA finding for our sector
- We must be able to prove our PTR coverage end-to-end — sampling won’t satisfy DIA
Operational Lessons
- Currency dimension matters — test PTR coverage across every currency we handle
- Reconciliation against the source-of-truth ledger — count system-of-record txns vs PTRs filed
- Periodic independent audit of PTR completeness, not just sample reviews
- Self-disclosure pathway is real — if we find a gap, disclose early
- A six-year gap can hide in plain sight — if you only look at NZD, you only see NZD
Action Items
- Reconcile non-NZD transaction counts vs PTRs filed for last 12 months
- Add an automated completeness check to the daily compliance report
- Document the escalation playbook for any newly-discovered reporting gap
- Build a disclosure template ready for use if a gap is found
- Brief Angela immediately on any reconciliation discrepancy ≥ 1 transaction
Key Lessons & Takeaways
- PTR completeness is a board-level risk — not just an ops task
- Currency segmentation is the most common blind spot
- Voluntary disclosure is the cheapest path — DIA rewards it explicitly
- Independent audit of reporting controls beats internal sign-off
- DIA’s posture is predictable — read past warnings, act before they become yours
Questions?
Thank you for your attention
References
- DIA Press Release — DIA issues formal warning to NZForex Limited for Anti-Money Laundering non-compliance (18 March 2025)
- AML/CFT Act 2009, section 48A (prescribed transaction reporting)
- Strategi Compliance — DIA issues formal warning to NZForex – what it means for your AML/CFT obligations