The Financial Markets Authority has filed anti-money laundering charges against the brokering and financial advice firm CLSA Premium NZ.
The authority claims between April 2015 and November 2018 the firm failed on numerous occasions to conduct proper customer due diligence, to report suspicious transactions and to keep records in accordance with the anti-money laundering laws.
"The regime has been in place since 2013 and CLSAP's alleged breaches are serious so it is appropriate for the FMA to take a strong regulatory response," FMA general counsel Nick Kynoch said.
"CLSAP NZ needs to be held to account and our approach sends an important message of deterrence to the industry."
The charges cover transactions worth nearly $50 million, and the company faces a fine of up to $2m if convicted.
The FMA said CLSA's directors at the time - Rongjun (June) Zhang, Songyuan Huang (Benny Wong), Stefan Liu, Robert CLSA Premium New Zealand Limited Noakes and Richard Clive Pearson - were not parties to the lawsuit.
CLSA Premium New Zealand is owned by LXL Capital II, which is registered in the British Virgin Islands.