The AML/CFT Act requires all new clients to have due diligence conducted on them before a business relationship can begin, where an adviser is a reporting entity.

This is not a requirement for advisers’ existing clients, although they are required to ensure appropriate due diligence is conducted on all clients and transactions, known as ongoing customer due diligence.

Meredith Cornelius, an adviser who now offers assistance with AML compliance, said that was a murky area. “This has created some confusion for advisers, particularly those who have larger pre-July 1 2013 client bases.”

She recommended they develop a systematic approach to identify gaps in their due diligence.

“It is likely that the FMA will consider annual review meetings standard or good practice. If you don’t already hold regularly annual review meetings, consider doing so over 2015. In addition to confirming client circumstances, this is an ideal time to update your AML/CFT responsibilities.”

Clients should be asked to bring along the necessary information, and take a photo of things such as updated IDs. “If five years ago you originally had IUD that proved who they were but a year or two later you find that’s expired, and you’re going to meet the client, why not pull out your phone and take a photo of their current ID? That’s in the spirit of ongoing due diligence.”

She said advisers were getting their heads around the legislation. The focus had been on getting the initial documentation in place but now it was turning to ongoing compliance. “Making sure you are dotting the Is and crossing the Ts.”