More than $1.35 billion-worth of illicit funds from fraud, tax offending and drug trafficking is ending up in New Zealand every year to be laundered, according to a new report from the NZ Police Financial Intelligence Unit.
And this number doesn't include money generated from overseas proceeds of crime, which could make the figure significantly higher.
The International Monetary Fund estimates approximately 2-to-5 per cent of global gross domestic product ($3.5 trillion-$8.8t) is proceeds of crime.
The latest annual National Money Laundering and Terrorism Financing Risk Assessment report says criminals and fraudsters are targeting legitimate New Zealand businesses in the financial, legal, property and retail sectors.
New Zealand is at a particular risk because of its trade links with Asia and its reputation as an open place to do business, the report said.
Transparency International NZ chair Suzanne Snively said anti-money laundering legislation over the last few years and increased numbers in the police's Finance Intelligence Unit had made a difference, but more needed to be done.
"We want to be open and transparent, a good place to do business. But we have to back it up with preventative methods, because inevitably scoundrels want to exploit our innocence. We haven't got as strong safeguards as we need."
Transparency International NZ is calling for an open public register of the owners of overseas companies and trusts set up in New Zealand, so anyone can see who's benefiting from any money moving through that company.
Snively said the European Union was moving down that track and the new Labour-led government should do so too.
"We've got a long way to go, but I think it's more likely now. If you'd asked me last year I'd have said 'maybe we'll never have a totally open public register of assets'. But with this government it could be within five years. It's not a hard thing to do, though it does require government investment."
A shake-up of disclosure around foreign trusts, prompted by John Shewen's 2016 report, saw the number of foreign trusts fall from 12,000 to 3000, Snively said - a clear sign many of them were being used to hold illegitimate funds. Now the same thing needs to happen with foreign companies.
The NZ Police report showed the first stage of anti-money laundering legislation, which was introduced in 2013, significantly boosted reporting of suspicious transactions. These rose from 3000 in 2012-2013, worth less than $1 billion, to a high of almost 12,000 in 2014-2015, with a value of almost $9b.
In April 2017, NZ Police launched its first dedicated money laundering investigations team. Since the eight-person team started work, the number of money laundering charges brought by NZ Police has gone from an average of four a month, to six, the report said.