Formal Warning

DIA Formal Warning 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.” ...

DIA Formal Warning Hills Real Estate Limited 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 under s80 AML/CFT Act 2009 Warning date: 8 May 2023 — publicly announced 6 July 2023 Second formal warning to a real estate agent within two months Signals DIA’s escalating enforcement posture against non-bank reporting entities Who is Hills Real Estate? South Auckland real estate agency A reporting entity under the AML/CFT Act since 1 January 2019 (real-estate sector phase-in) Required to maintain a full AML/CFT compliance programme, conduct CDD, monitor activity, and keep records — the same obligations that apply to financial institutions What DIA Found Four areas of non-compliance AML/CFT Programme — failed to establish, implement and maintain an adequate programme Ongoing CDD — neglected ongoing customer due diligence obligations Monitoring & review — insufficient transaction monitoring to detect grounds for SAR reporting Record keeping — failed to maintain records as required by the Act The Regulator’s Position “Real estate agencies should take note of the two recent warnings and expect stronger action for serious breaches. DIA uses escalating enforcement tools — from educational guidance through to prosecution.” ...