The Herald reports:
The Reserve Bank says it has issued a formal warning to state-owned Kiwibank for failing to comply with sections of the Anti-Money Laundering (AML) and Countering Financing of Terrorism Act.
In a statement, the Reserve Bank said it had “reasonable grounds” to believe that for various periods of time between June 30 2013, and June 2014, that Kiwibank did not fully meet all the requirements in respect to the following customer due diligence obligations under the act. …
The Reserve Bank said Kiwibank had not collected addresses of customers performing occasional transactions, as required by the act.
It also said Kiwibank did not always take reasonable steps to verify information relating to the source of funds or the wealth of the customer and did not consider terminating customers’ accounts in response to its ongoing non-compliance.
This is pretty serious stuff. I can’t recall the last time a major bank was formally censured by the Reserve Bank.