Anti-corruption campaigner asks why Sky City deal not probed

‘Open Letter’/OIA to NZ Prime Minister John Key:

 “Why have you not ensured that ‘due diligence’ was carried out over the increased risk of money-laundering with the International Convention Centre (Sky City) Bill”?

Dear Prime Minister,

As an ‘anti-corruption’ campaigner, (and 2013 Auckland Mayoral candidate),  I am deeply concerned at the apparent lack of ‘due diligence’, by yourself, as Prime Minister of New Zealand (‘perceived’ to be ‘the least corrupt country in the world’ ) regarding the increased risk of money-laundering arising from the International Convention Centre (Sky City deal) Bill?

http://www.transparency.org/cpi2012/results

Please provide all information which confirms why you failed to do ‘due diligence’ and consult the ‘lead agency’ (OFCANZ) who has responsibility for “making it harder to launder money“,

regarding the increased risk of money-laundering arising from the International Convention Centre (Sky City deal) Bill.

(Please be reminded of the role of OFCANZ, as stated on their  website: http://www.ofcanz.govt.nz/about-ofcanz

OFCANZ will combat organised crime through:

·  Leading, coordinating or contributing to policy or legislative changes to make it harder for organised criminals to operate. There will be opportunities to do so by, for example, making it harder to launder money, or obtain false identities, or by increasing information sharing.   )

MY ORIGINAL OIA REQUEST TO OFCANZ

Date: Thu, 11 Jul 2013 16:28:05 +1200
Subject: ‘Open Letter/ OIA ‘ request to OFCANZ
re: the increased risk of  money-laundering associated with the NZ International Convention Centre Bill 2013
From: Penny Bright <waterpressure@gmail.com>

11 July 2013

Sheryl McCormick
Administration

Financial Crime Group | Organised & Financial Crime Agency New Zealand
Police National Headquarters

‘Open Letter/ OIA ‘ request to OFCANZ re: the increased risk of money-laundering associated with the NZ International Convention Centre Bill 2013.

Dear Sheryl,
Can you please forward this ‘Open Letter / OIA request’ to whoever from OFCANZ is responsible for handling such requests.

BACKGROUND: ( re: Potential risk of money laundering )
http://www.med.govt.nz/about-us/publications/publications-by-topic/regulatory-impact-statements/mbie-regulatory-impact-statements/NZICC-RIS-June-2013.pdf

New Zealand International Convention Centre Bill 2013
Regulatory Impact Statement
New Zealand International Convention Centre
Potential risk of money laundering

95:  Cash intensive industries such as casinos are attractive to money laundering activity.  New  Zealand’s National Risk Assessment 2010 assessed casinos as presenting moderate to high risk of money laundering.
For  this reason, casinos (including all SkyCity casinos) are subject to the Anti-Money Laundering and Countering Financingof Terrorism Act 2009 (the AML/CFT Act), which comes into force on 30 June 2013.

96: Nothing in the Agreement affects SkyCity’s obligations under the AML/CFT Act.  Those obligations include:
a. – developing a risk assessment of the money laundering and terrorism financing risks facing SkyCity

b .- appointing an AML/CFT compliance officer

c. – designing and implementing an AML/CFT programme, which must include:
i.      vetting senior managers and staff engaged in AML/CFT related duties
ii.     training senior managers and relevant staff on AML/CFT related matters
iii.    complying with customer due diligence (CDD) requirements, including determining when enhanced CDD is required, when simplified CDD might be permitted, and when CDD can  be carried out by a person other than the reporting entity
iv.     reporting suspicious transactions
v.      monitoring and record keeping, especially in relation to specified high-risk transactions and business relationships
vi.     policies and procedures for how SkyCity will manage and mitigate its risks of money laundering and financing of terrorism
vii.    monitoring and managing compliance with the AML/CFT programme.

97: However, there are aspects of the regulatory concessions that  potentially raise the risk of money laundering through SkyCity.

98: For example, the  anonymity  that can be  associated with TITO technology has the potential to facilitate money laundering, by increasing the potential for currency refining and ticket structuring.

In effect, this means that low denomination notes could be fed into one or more gaming machines or kiosks and then be redeemed by ticket into high denomination notes or casino cheques.

Increasing the use of TITO technology (and raising the denominations that can be fed into a machine)  may therefore  increase the potential for money laundering.

99: Increased use of “white cards” may  also  lead to increased risk of money laundering.

White cards are an account-based system with a unique identifier that permits transaction sequences to be tracked.  However, the form of identification information associated with each card will depend on the “business relationship” between the casino and the white  card holder(s).

100:  The limits on anonymous cashing-out of TITO and white cards described in paragraphs 69-71 of this paper are aimed at mitigating this potentially higher risk of money laundering.
_______________________________________________________

I note the  role of OFCANZ, as stated on your website: http://www.ofcanz.govt.nz/about-ofcanz

OFCANZ will combat organised crime through:

·  Leading, coordinating or contributing to policy or legislative changes to make it harder for organised criminals to operate. There will be opportunities to do so by, for example, making it harder to launder money, or obtain false identities, or by increasing information sharing.

Under the OIA – can OFCANZ please provide the following information:

(1) Copies of all/any Information  OFCANZ has provided for the  NZ International Convention Centre Bill / or any related Regulatory Impact Report or Statement/ Cabinet re: the increased risk ofmoney-laundering

(2) Information which confirms that the views of OFCANZ on the increased risk of money-laundering were sought by any of the following parties:

a) Department of Internal Affairs
b) Ministry of Economic Development
c) Sky City
d) The Department of the Prime Minister and Cabinet
e) The Office of the Prime Minister
f)  Cabinet
g) Any Cabinet Minister (in particular Steven Joyce)

(3) I am also interested in any information held by OFCANZ on how TITO (Tickets In Tickets Out) can be used for money-laundering at casinos.
I would prefer this information to be provided electronically

(4) All/any information held by OFCANZ which raises concerns about the potential increase in ‘organised crime’ as a result ofpotentially increased money-laundering opportunities through the proposed NZ International Convention Centre Bill.

Kind regards,

Penny Bright

‘Anti-corruption / anti-privatisation’ campaigner
Attendee: Australian Public Sector Anti-Corruption Conference 2009
Attendee: Transparency International Anti-Corruption Conference 2010

2013 Auckland Mayoral candidate