Anti-Money Laundering and Countering Financing of Terrorism Act - Redux. Stymied in Best Practice.

Finally, a little victory.

The precursor of the below email is my earlier post regarding Judith Collin’s infuriating Anti-Money Laundering and Countering Financing of Terrorism Act. I’m wondering about the cost of this legislation to both our liberty, and the economy, given the bureaucratic monster it has unleashed. And just how much this Act, like the diabolical FATCA, is down to US bullying of New Zealand at the expense of our privacy and right to be left alone.

On the fifth day of my supposed annual holiday I have had to send this to a Christchurch law firm regarding a client trust property transaction, for which I am an independent trustee (all names redacted):

... here's the bit where you find I'm a pain in the arse, however I finally want to know the current law regarding witnessing and other matters. I was hoping to have this transaction dealt with by the time we left Geraldine, and as I said in my previous email, from this point I'll be asking my trust clients to please install their solicitors as independent trustee, but this would not necessarily have been the case were our legal processes, especially around contract, up to pace with the twenty first century use of Internet. I can be in the middle of nowhere here in the Marlborough Sounds doing my client work online, working seamlessly and securely through encryption with IRD, etc, until it comes to legal processes such as this, a simple contract for the sale of land: the legal profession and its legislative framework, seems to have barely moved beyond chiseling promises in granite, or medieval quill scrawled on parchment with a waxed royal decree, despatched over four days by horse and rider. Judith Collin's big government bureaucratic new Anti-Money Laundering and Countering Financing of Terrorism Act has made this situation noticeably worse, laying to waste the efficiencies that might have been gained for the productive sector, with the Internet as a way to transact contract quickly and cheaply.

[Snip.]

... my major problem is this growing conundrum around witnessing our driver's licences, passports, etc, on the authority to act, on every single client transaction - and for a start why are we repeating this every transaction? [Mrs H] and I are the only two here in the Mahau Sound because we 'are our firm', there is no one else to witness, other than our neighbours (some of whom I do know despite studiously endeavouring to know no one here, given we come to get away from people.) Going by what other solicitors are making us do since Judith Collin's new Act, here and in Geraldine, you will therefore want a solicitor, JP, notary public, et al, to witness our signatures and identification? That will be beyond inconvenient, possibly impossible, because from where we are in the Sounds it will involve a day trip. [Mrs H] is refusing to get in the car for that, she wants four weeks annual holiday, doing nothing (perhaps the odd nice winery meal). Note it isn't practical for us to have a power of delegation for our many trips to the Sounds, and in absence of these increasingly pedantic requirements, nor would we need one unless going overseas for a length of time. Until this stage I've not managed to get a single legal office to quote me the section and clause of this Act that says, for example, the retired school teacher neighbour we have, whom we can walk to for a cup of tea, and who knows us well,  isn’t better placed to witness our ID's and signatures over any solicitor, JP, et al in Blenheim, who wouldn’t know us from Al-Qaeda sleepers. That is, if you are going to insist on total inconvenience to myself and [Mrs H], is this mandated by an actual Act, or, is this the legal profession's pursuit of best practice in the chase of insane legislation? Because if not mandated by the letter of the law, then we'll just pop over to the neighbour - it is, after all, merely witnessing our corporeal selves, and we are merely the independent trustee :)

That said, got to go, [Mrs H] is looking daggers at me on the deck.

 And from this my tiny victory. The lawyer concerned – and I know I was a royal pain, sorry - said I could use my neighbour as witness, so the legislation does not demand a lawyer, JP, etc to be witness: all the lawyers making us do this up until now have I presume been following their new best practice – read ‘cover our arses’ – evolving from the profession (plus financing sector) around this monstrous Act of Judith's. I’m not necessarily blaming the licencing monopoly of lawyers for that. The blame rests squarely with the over-regulation of this small population of our's that would disappear in a single suburb of Hong Kong: the more rules created, the more moribund will become any system as participants seek to cover themselves due to perceived risk of falling foul of the state, or sued in contract. (And for those wondering why I didn’t just read for the applicable part of the Anti-Money Laundering Act, as to witnessing requirements, I have enough trouble keeping up with constantly multiplying income tax legislation, as you’ll see in my next post, and clearly there is no specific clause stating this in the Act, regardless, just the corpus and intention of that Act as interpreted by the legal profession, so I would've had to read the whole ruddy thing.)

This gets me back to where I started on the earlier post :

So my problem looks predominantly to have been legal best practice, no doubt being promulgated out of the professions continuing education programs. Peter Cresswell has a great piece on how bad for business - and my mental health -best practice is:

I DON’T KNOW ABOUT YOU, but I’ve grown heartily sick at the number times I've encountered wankers waffling on about "the importance" of following something called "best practice"—a practice by which everyone in a profession or industry is encouraged to copy the practices of those whom the wankers deem to be the best.

It’s not just bad grammar, it’s bad for business.

It is, of course, simply a recipe for encouraging mediocrity and box-ticking, discouraging entrepreneurial experimentation and innovation.  For banishing competition and difference. To substitute conformity for innovation, and “conventional wisdom” for independent thought. To establish an establishment.

Until recently, wankers like this were a danger only to themselves and to know-nothings who paid for their advice and could be safely ignored. (Wankers like this always charge for their advice--and the more worthless it is, the more they charge. As Greek philosopher Thales was supposed to have observed around 2,500 years ago, the most difficult thing in the world is to know oneself; the easiest is to give advice to others. The wankers always charge the most for the least.)

But with the government increasingly trying to put every professional's head into one noose--and with the grey ooze of bureaucracy increasingly covering every part of the country, ignoring this stupidity is becoming increasingly difficult. With the onset of compulsory occupational licensing for everyone from drainlayers to financial advisers, pretty soon we will see the elevation of “conventional wisdom” into law, to be ignored only at the risk of expulsion from one’s chosen profession.

“Best practice” is a recipe for the calcification of industry, and the banishment of the very entrepreneurial experimentation that drives production and technology improvements.

Finally, to show Judith it’s not only from this ranty libertarian perspective that there is a problem with this Act; look at the havoc its begetting all of us, from selling a property to such a simple thing as opening a bank account where all a person wants to do is deposit their own money, a transaction that is no business of the state at all. For the cost to New Zealand in resources and time, multiply this inconvenience by the thousands of such transactions occurring every day:

The NZ anti-money laundering law makes it ridiculously cumbersome to open a new bank account.
— Juha Saarinen (@juhasaarinen) March 18, 2014

@juhasaarinen YES, THIS.
— (

◞ꈍ∇ꈍ) (@ksuyin) March 18, 2014

@juhasaarinen and buy a house
— Hadyn Green (@hadyngreen) March 18, 2014

@ksuyin Two hours at the bank, a blizzard of forms and three days later, they need another document? WTF?
— Juha Saarinen (@juhasaarinen) March 18, 2014

@fastchicken No no, British banks need a w instead of a b in their names. I needed a referee to open an account.
— Juha Saarinen (@juhasaarinen) March 18, 2014

@juhasaarinen wait till you have to do t for a disabled child....
— Rob Hosking (@robhosking) March 18, 2014

@oharris69 This is it. It seems to be a US demand, yet it's without a US equivalent. To reduce NZ businesses and banks' competitiveness?
— Juha Saarinen (@juhasaarinen) March 18, 2014

@oharris69 That may not end well for anyone.
— Juha Saarinen (@juhasaarinen) March 18, 2014

Those last few posts are interesting. This Act is coming from Judith succumbing to US bullying and coercion: at some stage I shall have to write a post on the crossover of this to that other privacy destroying monstrosity, FATCA, and how that US fist into the belly of the West’s dying classical liberalism, thus the destruction of the Free West via the colonising US tax surveillance state, made possible only from the complete capitulation of our rights by our gutless politicians, is not even constitutional in the US.