More than $100 million intransactions may have not been properly checked under money-laundering laws by Qian DuoDuo Limited (QDD), which now faces a multi-million dollar government fine, a court has heard.
The Department of Internal Affairs (DIA) was seeking a fine of about $2.6 million, with Justice Grant Powell commenting that it was "truly extraordinary" that up to $7 million was at stake.
The department has accused QDD of failing to meet Anti-Money Laundering and Countering Financing of Terrorism Act (AML/CFT) requirements for customer due diligence, account monitoring, record keeping and risk assessment.
QDD, which was trading under Lidong Foreign Exchange, has not been accused of money laundering or funding terrorism.
Today, Internal Affairs'lawyer David Johnstone suggested that QDD had used consultancy firm Starfish because of the questions posed to the business by DIA not because the company had been trying to keep up with its own compliance, a claim QDD director Ye (Cathay) Hua denied in the High Court at Auckland.