Don’t Even Think About It: Money Laundering in Canada

In this post 911 era the media tends to highlight some of the more spectacular surveillance stories south of the border, and Homeland Security is often found at the epicentre of high profile investigations. But few people know that here in squeaky clean Canada, we have our very own special forces called FINTRAC: Canada’s Anti-Money Laundering and Anti-Terrorist Financing Initiative.

FINTRAC occupies an important position in the constellation of organizations involved in Canada’s fight against money laundering and terrorism. Each of these organizations has a particular relationship with FINTRAC. Due to the nature of its mandate, the Centre’s work is situated at the beginning of a process that starts with the reports to FINTRAC by financial institutions and intermediaries. With the assistance of specialized automated tools, skilled staff analyze the reported transactions and information from other sources to extract financial intelligence that would be relevant to the investigation or prosecution of money laundering offences, terrorist activity financing offences, and threats to the security of Canada.

Money laundering and terrorist financing cases can be extremely complex, often involving many players implicated in transnational and covert illicit activity. The investigations are often time and resource intensive. For this reason, the time between FINTRAC’s initial disclosure and the conclusion of an investigation can be quite lengthy.

 

Businessman Using Laptop With Thief Shadow

Who is FINTRAC?

The Financial Transactions and Reports Analysis Centre of Canada (FINTRAC), Canada’s financial intelligence unit, was created in 2000. It is an independent agency, reporting to the Minister of Finance, who is accountable to Parliament for the activities of the Centre. It was established and operates within the ambit of the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA) and its Regulations.

 

What is their mandate?

Their mandate is to facilitate the detection, prevention and deterrence of money laundering and the financing of terrorist activities, while ensuring the protection of personal information under their control. They fulfill their mandate through the following activities:

  • Receiving financial transaction reports and voluntary information on money laundering and terrorist financing in accordance with the legislation and regulations and safeguarding personal information under our control;
  • Ensuring compliance of reporting entities with the legislation and regulations;
  • Producing financial intelligence relevant to money laundering, terrorist activity financing and threats to the security of Canada investigations;
  • Researching and analyzing data from a variety of information sources that shed light on trends and patterns in money laundering and terrorist financing;
  • Maintaining a registry of money services businesses in Canada;
  • Enhancing public awareness and understanding of money laundering and terrorist activity financing.

 

KEY REGULATIONS

The Proceeds of Crime (Money Laundering) and Terrorist Financing Regulations

This regulation prescribes:

  • customer identification requirements;
  • record keeping requirements;
  • transactions that must be reported (such as large cash transactions, electronic funds transfers and casino disbursements);
  • compliance regime requirements.

 

The Cross-Border Currency and Monetary Instruments Reporting Regulations

  • defines “monetary instruments”;
  • prescribes the reporting threshold at $10,000;
  • prescribes the form and manner for reporting to CBSA.

 

The Proceeds of Crime (Money Laundering) and Terrorist Financing Registration Regulations

It prescribes applications, notifications, clarifications and supplementary information for money services business (MSB) registration.

 

References:

http://www.fintrac-canafe.gc.ca/fintrac-canafe/antimltf-eng.asp

 

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