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nies now registered in New Zealand -- one for every eight citizens -- the database is large and growing.
• And in the case of SP Trading, it wasn't until two months ago that the Companies Office finally removed it from its register of legitimate businesses.
• The European Union became concerned enough that last year it struck New Zealand from its so-called "white list" of countries that require only minimal customer due diligence for transactions involving financial and credit institutions. Concerned that New Zealand could be prone to money laundering and terrorist financing, the EU reaffirmed this year that New Zealand wouldn't be on the list, which includes Australia, Canada and the U.S.

• That's been an embarrassment for the developed nation that is regularly rated among the world's least corrupt.
• Last week, New Zealand's Commerce Minister Craig Foss introduced a bill that he says will tighten the rules by requiring each listed company to have a New Zealand-based agent who will bear some legal responsibility. But even if passed by the parliament, the new law would not come into effect until mid-2013 and would not go far enough to satisfy some critics.
• "It's about balance," Foss said in an interview. "We are renowned for our ability to get companies up and running in New Zealand. We need to balance that ease with our obligations to make sure we are doing what we can to stop abuse."
• He said the new rules would dovetail with anti-money laundering legislation that is being spearheaded by Justice Minister Judith Collins.
• Some say New Zealand has yet to get serious about stopping abuse. Financial blog naked capitalism has repeatedly accused New Zealand of playing the equivalent of the arcade game "Whac-a-Mole" by knocking down illegitimate operators as they pop up but not dealing with the systemic problems that give rise to the abuse.
• "There are significant gaps in New Zealand legislation, especially concerning the registration and supervision of companies," said Michalis Rokas, the Chargé d'Affaires for the EU delegation in New Zealand.
• Rokas said EU member states will likely review whether New Zealand can be restored to the white list if and when the country enacts the proposed new laws.
• Alastair Stewart, a spokesman for the Ministry of Business, Innovation and Employment, wrote in an email that authorities are aware that operators like Lowrance are abusing the system and they're undertaking a wide program of work "to further reduce the misuse of New Zealand's-registered companies and protect our international reputation."

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