Anti-terror laws and homelessness

How anti-terror laws promote homelessness in NZ

Barney Wikitera, Kaihāpai Hapori/Community Educator and Advocate, Community Law Wellington and Hutt Valley

You’re homeless. To get a house, you need an income. To get an income from Work and Income, you need a bank account. To get a bank account, you need a residential address. But … you’re homeless.

You see the problem. This article analyses this issue and the recent attempts Community Law has made to support clients faced with this situation.

Struggling to get photo ID

In most cases homeless clients do not have sufficient identification to open a bank account to receive much-needed government assistance.

Work and Income can provide a grant for a birth certificate, which usually takes two weeks to arrive. Work and Income can also provide assistance to get an 18+ card, but the client needs a witness who has photo ID and has known the client for more than a year. Moreover, the client also needs proof of address in order to get an 18+ card. This can be hard for transient clients living on the margins.

Through the eyes of a homeless person, the process can be hugely stressful, particularly without support. Most of our homeless clients are in immediate need of assistance, so all the delays and hoops to jump through can exacerbate already dire situations.

Using an agent

A client can authorise an agent to receive Work and Income benefits on their behalf. They can use an individual, like a friend or a family member, or an approved organisation, such as DCM (formerly Downtown Community Ministry). In the short-term, the use of an agent can be a viable option. However, the importance of being independent and handling your own money should not be dismissed. A recent client felt this strongly. He did not want to use an agent because the idea of having to line up to have government assistance passed to him through a third party was demoralising. His frustration was understandable, given that the barriers were purely administrative and regulatory. He had a driver’s licence, but what prevented him from opening a bank account was that he did not have proof of address.

Anti-Money Laundering and Countering Financing of Terrorism Act of 2009 (AMLCFT Act) – the problem

The AMLCFT Act aims to fulfil the goals in its name while also promoting public confidence in banks and New Zealand’s international cooperation on these matters. Banks are required to get proof of address from new customers (section 15(b)). Providing proof of address goes toward fulfilling the Act’s due diligence requirements, ensuring that customers have been assessed to a certain standard to essentially minimise risk.

We believe our homeless clients do not pose a risk in terms of laundering money or financing terrorism. But how do they provide the bank with proof of an address that they do not have? This is a problem for homeless people around the world. (See for example the House of Commons September 2013 Standard Note “Bank accounts: problems of identification”).

“Socially inclusive banking”

We believe that reasonable proof of homelessness should be adequate. Our client was eventually able to open a bank account and directly receive government assistance. With Community Law’s reassurance that our client was homeless, the bank eventually accepted that he did not have an address. This was on the condition that we kept the bank regularly updated on his progress finding sustainable accommodation. We welcome this socially inclusive banking. However, the bank was clear that this was an exception and it was evident they would not have opened a bank account for our client without the advocacy Community Law was able to provide.

By definition our homeless population do not have a residential address, and we cannot rely on strong advocacy and the good will of individual banks to assist in most situations. Despite our advocacy and the discretion employed by the bank, our client still went without financial assistance for two weeks. A degree of flexibility, anchored in robust law and policy is needed.

The AMLCFT Act refers to “simplified customer due diligence” where some groups, such as government departments, have a lower threshold to reach when opening a bank account. There could be the opportunity to prescribe criteria that can fulfil the legal requirements of due diligence, such as accepting confirmation of homelessness by a community or government organisation.

Work and Income could certify that they believe a client is homeless when an applicant for a bank account is made. In most situations Work and Income case managers are in a good position to make that judgement. There may also be the potential for Work and Income to bridge the gap and deal directly with banks on behalf of our homeless so that limited-accounts (without features such as overdrafts) are accessible. This could provide banks a safe harbour in which to make more flexible decisions around bank accounts for our homeless.

Inevitably our homeless will need some form of support, but that does not have to be at the expense of their independence and self-worth. When someone who is homeless wants to open a bank account, fostering an encouraging environment for that to happen is crucial. Some consistency and permission for banks to be helpful would go a long way towards helping a range of homeless people, from the chronic homeless to those couch-surfing.

We are interested to hear about your ideas and your clients’ experiences. Please contact Barney at or 04 894 4490.

Thanks to interns Timo Schrott and Kate Dowdle for research for this article.


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