Auckland-based Tiger Brokers admitted to failing to conduct customer due diligence , failing to terminate an existing business relationship with any customer where it was unable to conduct customer due diligence, failing to report suspicious activities, and not keeping records in accordance with the Anti-Money Laundering and Countering Financing of Terrorism Act.

Tiger transacted approximately $60.8m without proper checks and controls in place from April 2019 and January 2020, 

The FMA said Tiger’s customer due diligence and record-keeping breaches were of greatest magnitude — the former extended to at least 3,768 customers. The record-keeping breaches were part of a weak approach to compliance across the business which, from 2019 to 2020 comprised between 69,705 and 126,230 customers and transactions to a gross total value of between $3.6 billion and $35.2 billion.

The FMA began an investigation following a formal warning in April 2020.

In court Justice Gault said Part 2 of the Act plays an important role in New Zealand’s regulatory landscape.

“Its purposes are to detect and deter money laundering and the financing of terrorism; maintain and enhance New Zealand’s international reputation; and to contribute to public confidence in the financial system.”

The FMA’s head of enforcement Margot Gatland said the case shows that the FMA can and will use a wide range of tools to deal with a firm’s approach to compliance, both to stop immediate harm continuing, and where the misconduct is serious, take stronger enforcement action through the courts.

The court found Tiger Brokers failed to appropriately vet customers, respond to activities that should have raised concerns, and maintain records in the manner required by the Act; all core obligations for an AML/CFT-reporting entity. 

Tiger Brokers is the New Zealand-based subsidiary of Tiger Fintech (Singapore) and provides share broking services through an online trading platform, Tiger Trade.