CDD Timing – Clarity from the DIA
Given the difficulties and frustration around requiring Customer Due Diligence (CDD) to be carried out before an agency agreement has been signed, REINZ has been lobbying the Department of Internal Affairs (DIA) for clarity on the requirements. As a result, the DIA has now confirmed that in certain situations the verification step of CDD may be delayed until after the agency agreement has been signed, which means that agents can complete CDD with less business interruption. This is fantastic news for our industry and we're really pleased the DIA has worked with us to make it easier for agents when signing up a new client.
Regulation 24 of the AML/CFT regulations requires real estate agents to conduct CDD prior to entering into an agency agreement. CDD involves two parts:
- Firstly, obtaining the information. This involves obtaining the name, date of birth, address, nature and purpose of business and, where enhanced CDD is required (e.g. for Trusts), the source of funds and wealth of the vendor; and
- Secondly, verifying the information collected to ensure that it is accurate. Verifying information involves collecting evidence that the information provided by the vendor is true. This is the most time consuming part of CDD.
Requiring both parts of CDD to be carried out before an agency agreement is signed has caused practical difficulties for agents where verification has taken a long time, such as where the vendor is a complex trust or company entity. The DIA has now confirmed that in these situations the verification step of CDD may be delayed until after the agency agreement has been signed, provided that the following three conditions are satisfied:
- The agent can show that delaying verification was necessary so as not to interrupt normal business practice. Day-to-day this means that delayed verification only applies where the vendor has, for example, a complex ownership structure or where enhanced CDD is being carried out. Verification cannot be delayed where both parts of CDD can be carried out quickly and easily;
- AND the agent takes no steps in relation to the agency until such time as CDD verification is complete. This means that an agent cannot start marketing the property or do any work for the vendor until CDD is complete and if CDD cannot be completed, the agency agreement must be terminated
- AND CDD is completed as soon as possible after the agency agreement has been signed.
Click here to read the recommended clauses for your agency agreements and click here to read the letter from the DIA.
FlexiSign - Negotiate, Sign, Sold
Do you enjoy trying out new technology in your day-to-day job?
Become one of the early users of FlexiSign, the online negotiation and signing tool - now also compatible with mobile and tablet.
Agents across New Zealand are already using it to improve their productivity:
"We signed up for FlexiSign swiftly as soon as we heard about it. Being digital using it saves time, hassle and paper. We cannot imagine our Agency Life without FlexiSign. It is a perfect 21st Century invention."
Conny Foster, Colony Realty, Licenced REAA 2008
Visit the FlexiSign website, or log into eForms to sign up today.
Section 136
The majority of licensees are now familiar with the disclosure requirement that applies to them under section 134 of the Act where the client’s property is acquired by the licensee or its related persons. It is, however, easy to forget that situations that may not necessarily be captured by s134 may fall under s136.
This section details what other benefits that a licensee must disclose to a client.
Section 136 states that a licensee must disclose in writing any potential financial benefit from a transaction before or at the time that the licensee provides the prospective party with any contractual documents that relate to the transaction.
As this requirement captures potential financial benefit, its application can be very wide and can include situations where any indirect financial benefit to a licensee or its related person is possible or likely.
Agencies must ensure that proper processes are in place for this type of disclosure to be made where required in order to carry out their supervisory role.
It should be noted that an agent does not benefit financially from a transaction merely because of any commission payable to them.
You can find the Disclosure of Financial Benefits form under the Advisory Tab on our website.
Brightline Test
Remember, the bright-line rule applies to the sale of any residential property a vendor has bought on or after 1 October 2015 as follows:
- if they bought a residential property between 1 October 2015 to 28 March 2018, then the two year bright-line rule applies
- if they bought a residential property on or after 29 March 2018, then the five year bright-line rule applies.
Verifiable Training
Whangarei Verifiable Training - LAST CHANCE
Wednesday 8 & Thursday 9 May
Registration deadline Thursday 2 May - a $50 per person late fee will apply after this date.
New Plymouth Verifiable Training
Wednesday 15 & Thursday 16 May
Registration deadline Thursday 9 May - a $50 per person late fee will apply after this date.
Check online for a full list of regional training sessions or the newly released online training packages!
Please note: In 2019 the AML Verifiable training topic is mandatory and no exemptions apply.
REINZ Rural & Lifestyle Roadshow
Final change for Invercargill, Christchurch, and Cromwell.
REINZ has organised a 2-hour workshop for our rural & lifestyle sector, presented by John Abbott.
This session will cover getting your head right; prospecting; winning the pitch; presenting compelling information; increase marketing/campaigning; managing clients and closing sales.
REINZ presents the Anti-Money Laundering Roadshow - Part 2!
Practical, hands-on and detailed training. Check out the poster
Find your suitable session and book now.
Appraisals and You - Staying safe with the REA
Friday 10 May
Hosted by Graham Crews, this is a must-see 2-hour workshop that ensure you have the clarity and understanding required when it comes to appraisals. This detailed session will get right to the heart of appraisals, covering off what you need to know in order to be compliant.
Book in now!
Can't make the session in Auckland? Join the Live-Streamed Webinar
NEW! Code of Conduct Workshop
Wednesday 29 May
Presented by Richard Hern (Wynn Williams) this workshop will present a thumbnail sketch and basic toolbox for dealing with complaints and charges relating to the Code of Conduct.
Book in now!
Verifiable Dates for 2019
| Region | Dates | Location | |
|---|---|---|---|
| May | |||
| Whangarei | 8 - 9 | Northland Events Centre | Book Now |
| New Plymouth | 15 - 16 | Novotel | Book Now |
| Hamilton | 29 - 30 | Workingmen's Club | Book Now |
| June | |||
| Taupo | 5 - 6 | Suncourt Hotel & Conference Centre | Book Now |
| Invercargill | 5 - 6 | Ascot Park Hotel | Book Now |
| Rotorua | 19 - 20 | Copthorne Rotorua | Book Now |
| Timaru | 19 - 20 | The Grosvenor | Book Now |
| July | |||
| Palmerston North | 3 - 4 | Hotel Coachman | Book Now |
| Nelson | 24 - 25 | Trailways Hotel | Book Now |
| August | |||
| Kerikeri | 7 - 8 | Kingston House | Book Now |
| Napier | 21 - 22 | Napier Conference Centre | Book Now |
| September | |||
| Tauranga | 4 - 5 | Waverly on Wairoa | Book Now |
| Auckland 2 | 25 - 26 | Events on Khyber | Book Now |
| October | |||
| Christchurch 2 | 16 - 17 | The Atrium | Book Now |
Regional Events
New Plymouth Regional Meeting
Wednesday 15 May, 4:00pm - 5:30pm
Join REINZ Chief Executive Officer Bindi Norwell as we bring you the 2019 Thames Regional Update held at the Novotel Hotel. Drinks and nibbles will be supplied, registrations for catering and CPD purposes.
Sports Tournaments
Auckland Golf Tournament
Thursday 16 May, 10:30am - 5:30pm
Entry includes green fees, prize table, first drink and after match platters. Thank you to our sponsors Property Press, Mercedes-Benz and Barfoot & Thompson. This event is open to REINZ Members, partners and clients. Registrations close on Friday 9th May (unless sold prior).
Registration will be open on the day from 10:30am. Prizes will be awarded for Stableford Competition and Men's & Ladies Gross.
For more information, please contact Events@reinz.co.nz
2019 RPM CONFERENCE - THRIVING IN CHANGING TIMES
Friday 2 August, Hilton Hotel Auckland
This not-to-be missed Property Management Conference is hosted by Simon McKinney and filled with a great line-up of speakers such as Lisa O’Neil, Dr Annette Beautrais, Steve Watson, Lisa Gerrard and Sheree Nicholas.
Breakout sessions will be available for Property Managers, Business Owners and Administrators.
Registration includes Cocktail Networking Drinks where the winner of the ‘2019 Recognition of Contribution to the Property Management Industry’ will be announced.
Inspire | Motivate | Connect - 2019 YPIRE Conference
Wednesday 18 September
For young professionals in real estate, those new to the industry, the young at heart or anyone interested in the amazing speaker lineup.
With a great lineup of speakers including Tom Panos, Jake Millar and Lisa King, the 2019 YPIRE Conference is one you do not want to miss!
Grab your earlybird tickets before 31 May for the best pricing!
For all REINZ Events, click here.
| May | |||
| New Plymouth Regional Meeting | 15 May | 4.00pm - 5.30pm | Novotel New Plymouth |
| Auckland Golf Tournament | 16 May | 10.30am - 5.30pm | Akarana Golf Club |
| June | |||
| NZ Auctioneering Championships - Draw | 23 June | 5.30pm - 7.30pm | REINZ, Auckland |
| NZ Auctioneering Championships - Heats | 24 June | 10am - 5pm | REINZ, Auckland |
| NZ Auctioneering Championships - Finals | 25 June | 10am - 6pm | REINZ, Auckland |
| Septmber | |||
| Inspire | Motivate | Connect Conference | 18 September | 10am - 7pm | Shed 10, Auckland |
Free Training Sessions - 1.0 NV hour each
Streamlining your contracts with REINZ eForms - Wednesday 8 May, 10.00am - 11.00am
Introduction to FlexiSign - Wednesday 8 May, 11.15am - 12.15pm
Auckland's fastest growing suburbs
REINZ conducted some research into Auckland's fastest growing suburbs and Takapuna came out on top. You can read the full article here.
Survey of REINZ Members
REINZ will shortly be undertaking a membership survey to understand how best to support its members, to gain an understanding of compliance costs, your views on industry related issues and your views on culture and diversity.
This research is being undertaken by Kantar, an independent research company and feedback will be anonymous. You’ll receive an email link from Kantar on 3 May. Please let us know if you have any questions or would like to discuss this in more detail.
Everyone who completes the survey will go in the draw to win a Nespresso Essenza Mini Breville Pure Black thanks to REINZ Member Benefit partner Noel Leeming.
REINZ works in partnership with NetYourJob recruitment to provide maximum industry coverage when you’re looking for real estate staff. NetYourJob can provide REINZ Members with competitive marketing rates for job advertising. Contact NetYourJob on 0800 638 968 to find out more or click here to view new jobs this week.
