Anti-money laundering crackdown: Cryptocurrency ATMs used to ‘launder cash from drug sales’ to be banned

“Criminals can use these ATMs to purchase cryptocurrency and switch that cryptocurrency inside minutes to offshore criminals to fund drug imports or to make payments associated with scams.”

The independent advisory group noted these ATMs were made illegal in the UK in 2022 and really helpful digital present ATMs be banned “as a crucial step in disrupting organised crime operations”.

“This may take away a key laundering mechanism, shut a major loophole within the monetary system, and hinder the flexibility of transnational organised crime to convert and transfer income invisibly.”

Police additionally warned of those ATMs in its 2024 Nationwide Threat Evaluation, saying drug offenders used them to “launder cash from drug gross sales”. Fraudsters additionally satisfied New Zealanders to buy crypto for funding in fraudulent schemes, police stated.

“Romance rip-off victims bought cryptocurrency to ship to mule wallets, or to the scammer’s wallets in different jurisdictions.”

McKee stated the Authorities is “critical about focusing on criminals, not tying up respectable companies in pointless purple tape” and can introduce a brand new piece of laws to strengthen enforcement powers for police and regulators to crack down on folks concerned in cash laundering.

“It can additionally set up a brand new monetary sanctions supervisory regime and provoke engagement on a sustainable levy to fund [anti-money laundering/combating the financing of terrorism (AML/CFT)] system enhancements,” she stated.

“The brand new strategy will ship extra readability and consistency for companies whereas sustaining a powerful concentrate on stopping legal misuse of the monetary system.”

To cut back the flexibility of legal organisations to transfer funds offshore, the Authorities will even introduce an higher restrict on how a lot cash can be despatched through worldwide fund switch providers. This can be set at $5000 per switch.

Folks will nonetheless be ready to switch greater than $5000 abroad for respectable causes in different methods, like through digital checking account transfers.

The Authorities says the intent of this variation is to make it more durable for criminals to benefit from worldwide fund switch providers by utilizing the cash proceeds of crime to facilitate worldwide funds.

“We will even allow the Monetary Intelligence Unit [FIU] to order banks and different companies topic to the AML/CFT Act to present ongoing related data on individuals of curiosity,” McKee stated.

“The FIU will even be ready to order the manufacturing of vital contextual data from different companies on the monetary actions of individuals of curiosity. This can allow the simpler growth of the monetary intelligence wanted to convey the criminals to justice.”

McKee has already made two bulletins this week relating to anti-money laundering. On Monday, she stated adjustments would be made to laws to make it easier for parents to open bank accounts for his or her youngsters, whereas yesterday she stated requirements around family trusts would be simplified.

Jamie Ensor is a political reporter within the NZ Herald press gallery group primarily based at Parliament. He was beforehand a TV reporter and digital producer within the Newshub press gallery workplace. In 2025, he was a finalist for Political Journalist of the 12 months on the Voyager Media Awards.