The FMA released its first monitoring report on the AML/CFT regulations this week, and reported high levels of non-compliance.

Businesses that are reporting entities under the AML rules have to be audited every two years, or as requested by the FMA.

Adviser Meredith Cornelius, who started up an audit business to help advisers access low-cost audits, said she had been frustrated at the level of non-compliance she had encountered.

She said many advisers were blaming the FMA, which was just administering a law that was being applied internationally.

“People aren’t getting it. Advisers are finding it very difficult. I wanted everyone to pass [their audits] and be fine but I can’t do their programmes and assessments for them, it’s up to them to be compliant...I’m frustrated because I wanted to keep the price down [but] it’s like a teacher marking a paper. If it’s a poor paper, poorly presented, not structured how it should be, it’s a lot harder and it takes a lot longer to go through it.”

She said she would not put her prices up but would consider offering those who failed their audits a follow-up for an additional fee.

Many advisers were angry about the obligations being placed on them. “In a way, they have reason to be. It seems the whole world is full of compliance but it’s not the FMA trying to get them. Look at other countries, the rules are similar," she said.

Cornelius said it should not be hard for adviser businesses to get their AML systems up to scratch. “Just read the legislation, there are towo main sections that outline what you have to do. This isn’t the FMA finding something to spend their day doing. It’s an international thing and AFAs are caught in it so be it, you just have to sort it and do it.”

Gavin Austin, of ABC Compliance, said a lot of advisers had problems getting their policy, process and controls right. “It’s something big organisations are so used to doing but when you flip it to a one-man band, I’m still struggling with how to advise them a bit because it’s very difficult for an individual to put on all these different hats.”

He said it was unclear how much help and detail an auditor could give and still meet the requirement for independence. “If you’re reporting to yourself all the time, what’s the point in that?”