Part 6 – Division 19
Overview: Money Laundering and Terrorist Financing
Proceeds of Crime (Money Laundering) and Terrorist Financing Act
The amendments to the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (the Act) will update and strengthen the legislation to combat money laundering and terrorist financing activities, including with respect to Canada’s compliance with international standards set out by the Financial Action Task Force, the international standard-setting body in this area.
Part 1 (Record Keeping, Verifying Identity, Reporting of Suspicious Transactions and Registration) and Part 1.1 (Protection of Canada’s Financial System) of the Act
The amendments clarify the application of the Act to securities dealers and casinos and expand its application to include online casinos, persons and entities that deal in virtual currencies and foreign money services businesses. They also update the money services businesses registration requirements to clarify existing obligations and reflect the addition of foreign money services businesses. They prohibit specified financial entities from having accounts for, or correspondent banking relationships with, unregistered foreign money services businesses.
The amendments provide that reporting entities must take prescribed measures in prescribed circumstances (which will be set out in regulation) in respect of politically exposed foreign and domestic persons and heads of international organizations, as well as designated family members and close associates of such persons. The amendments enhance existing obligations that require reporting entities to coordinate their anti-money laundering and anti-terrorist financing programs across a financial group.
The amendments define a foreign entity for the purposes of Part 1.1 and bring this Part into force.
Part 2 of the Act (Reporting of Currency and Monetary Instruments)
The amendments clarify obligations related to the cross-border currency reporting requirements, notably with respect to answering questions and the form in which completed reports and relevant information are to be provided to the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) by the Canada Border Services Agency (CBSA). The amendments also update the appeal and review provisions under the cross-border currency reporting program and expand the circumstances that authorize the CBSA to disclose information collected under this Part.
Part 3 of the Act (FINTRAC)
The amendments clarify the intent of the existing information-sharing provisions in the Act between FINTRAC and the Minister of Finance. The amendments also strengthen the limitations on the type of information that can be shared and install a new requirement for the Director of FINTRAC to report to the Minister of Finance annually on FINTRAC’s compliance activities, and its performance and effectiveness.
The amendments allow FINTRAC to collect relevant information from specified international databases and they clarify FINTRAC’s obligations for destroying information on transactions that reporting entities erroneously reported to FINTRAC.
The disclosure provisions of the Act are amended to, among other things, clarify the thresholds that enable FINTRAC to disclose intelligence of suspected money laundering and/or terrorist financing to law enforcement and others, and to expand the list of disclosure recipients to whom FINTRAC can disclose intelligence on suspected threats to the security of Canada. The amendments also enhance the type of information that FINTRAC can disclose on these cases.
Other amendments allow FINTRAC to share with the Canada Revenue Agency compliance-related information that would be relevant to the implementation of international electronic funds transfer reporting requirements under the Income Tax Act.
Part 4 (Regulations) and Part 5 (Offences and Punishment) of the Act
The amendments modify the regulation-making authorities and the general offence provisions consequential to various amendments described above.
Technical and Consequential Amendments
A series of technical amendments are also made to ensure consistency between the French and English versions of the statutes. Some re-numbering of provisions has also occurred.