Money transfer company fined $2.55 million for money laundering

Money transfer company fined $2.55 million for money laundering

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Jiaxin Finance Limited, assisted by its owner Qiang Fu and his mother Fuqin Che, have been convicted of offences under the Anti-Money Laundering and Countering Financing of Terrorism (AML/CFT) Act.

Between April 2015 and May 2016, Jiaxin Finance and its brokers were responsible for remitting over $53 million into New Zealand for an international customer.  

The charges

Jiaxin Finance failed to conduct customer due diligence and failed to report and keep records of suspicious transactions relating to this customer.

Ms Che also separately structured transactions to try to avoid the application of AML/CFT requirements for this customer.

She did this by making 14 separate cash deposits totalling $710,772 into his New Zealand bank account. These payments were spread over a period of four days and made at different branches of the bank.    

On March 3, 2020, in the Auckland High Court, Jiaxin Finance was sentenced to pay a fine of $2.55 million. Mr Fu wad sentenced to pay a fine of $180,000 and Ms Che $202,000.

First criminal action

AML Group Director Mike Stone said this is the first time criminal action has been taken under the Act by any of the AML/CFT supervisors.

“We worked closely with Customs and Police to piece together the full picture of the extent of the offending. Money-laundering is a global issue, and unfortunately it does happen here. An estimated $1.35 billion from fraud and illegal drugs is laundered through legitimate New Zealand businesses every year. The true cost and social impact is much higher.

“New Zealand needs to maintain its reputation of being corruption free and a great place to do business. We need to protect that reputation. 

“It is vital that businesses know what to look for and report suspicious activities or transactions. Most businesses we supervise want to do the right thing, but when a business intentionally fails to comply with its AML/CFT obligations, we will take strong regulatory action.”

For more information visit our website www.dia.govt.nz/AML-CFT-Homepage

Source: Department of Internal Affairs, Government of New Zealand

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