The Financial Markets Authority (FMA) of New Zealand has issued a formal warning to Sharesies Limited and Sharesies Nominee Limited for inadequate AML policies and controls. This warning comes during the FMA’s ongoing monitoring of AML/CFT compliance at Sharesies.
The FMA identified that Sharesies had failed to seek information about the nature and purpose of the proposed business relationship from most customers. Moreover, the company did not collect adequate information to identify customers who require enhanced customer due diligence. Further, Sharesies failed to complete identity verification for 7,815 customers. Notably, all of these customers had more than $1000 in their accounts and identity verification was mandatory as part of standard customer due diligence.
As such, the FMA requires Sharesies to collect information that shows the reasons why its customers are using the platform. The company must also modify its customer onboarding process to ensure that such information is always collected in the future. Sharesies must also ensure that it carries out a complete identity verification when a customer submits an account application. It must also train its staff adequately on these verification processes. Furthermore, enhanced customer due diligence must be conducted for customers who have used the word ‘trust’ in the account application.