CLSA Premium NZ, previously known as KVB Kunlun New Zealand Limited was recently sued by the Financial Markets Authority (FMA) of New Zealand.
Cases against CLSA Premium NZ
The FMA announced this week that it has filed civil proceeds in the High Court against CLSA Premium New Zealand Limited. The firm was allegedly involved in several breaches of the Countering Financing of Terrorism (CFT) and Anti-Money Laundering (AML) laws. The company is the local subsidiary of CLSA Premium Limited, which is based in Hong Kong. It provides a range of financial services to clients including financial advice, derivatives, and brokering.
A Tuesday statement from the regulator highlights that the firm failed to perform adequate due diligence and enhanced customer due diligence as well. The company also failed to terminate its business relations when needed. It did not suspicious transactions on its platform and also failed to keep records in accordance with the AML/CFT Act.
It added, “The FMA also claims that these alleged breaches are representative of CLSAP NZ’s general approach to compliance with its obligations under the AML/CFT Act over the time that they occurred. The representative transactions involve nearly $NZ50 million and occurred between April 2015 and November 2018.”
What could FMA face?
The statement said that the firm’s directors have not been made parties of the High Court proceedings. Its directors during the relevant times were Richard Clive Pearson, Robert Manwarring Noaks, Stefan Liu, Songyuan Huang (Benny Wong), and Rongjun (June) Zhang. The regulator is seeking a pecuniary penalty from the company alongside costs in the High Court. The maximum pecuniary penalty for these offenses is $2 million.
FMA General Counsel Nick Kynoch said that the anti-money laundering legislation helps in protecting the country’s financial systems. It is important that financial services firms remain compliant with these laws. He informed that the AML/CFT regime has been active since 2013 and the nature of CLSAP’s breaches was so serious that the regulator was forced to take strong action.