Are you reporting to FINTRAC? Do you have concerns about reporting obligations? Are you over reporting? Are you under reporting? Changes in FINTRAC reporting requirements are underway!
The AML Shop’s Tuhina Seth (AML Analyst) breaks down the forthcoming changes in FINTRAC reporting requirements that are coming into effect on June 1st and what these changes means for Reporting Entities, when voluntary disclosures are required, and more.
Read the full article below.
Have you ever received a “FINTRAC Money Services Business” certificate? Is it legitimate? Does FINTRAC even issue Registration Certificates? The simple answer is NO! The information in the certificate might be real, but the certificate itself is a fake.
The AML Shop’s Marcelle Dadoun (AML Advisor) insightfully breaks down the actual process that FINTRAC conducts when they approve an MSB/FMSB, and what to do if you receive a fake certificate.
Read the full article below.
In light of the recently released Federal Budget for 2021, The AML Shop’s Bruce Hauser (AML Advisor) has written an insightful article titled Federal Budget 2021: Action Against Money Laundering and Terrorist Financing. Read the full article below.
By now, you probably have heard that IIROC and the CSA released a joint statement outlining the application of securities law to crypto trading platforms. This means that dealers in virtual currency could meet the definition of a securities dealer, as defined in paragraph 5(g) of the PCMLTFA, which includes “persons and entities authorized under provincial legislation to engage in the business of dealing in securities”. However, dealers in virtual currency also meet the definition of an MSB that is given in paragraph 5(h). This definition includes “persons and entities that have a place of business in Canada and that are engaged in the business of…dealing in virtual currency”. This got me to thinking: “are dealers in virtual currency securities dealers now, or are they still MSBs?”
FINTRAC, released policy interpretation 5404 in 2012, which at first glance would appear to address this issue. This policy interpretation states:
“Should a securities dealer provide money services business (MSB) activities, such as foreign exchange, outside of their securities dealer activities, the securities dealer would be required to register as an MSB. Upon registration as an MSB, the registrant would indicate that their business is also another type of reporting entity (i.e., a securities dealer). As an MSB and a securities dealer, the entity would be subject to all applicable sections of the Proceeds of Crime (Money Laundering) and Terrorist Financing Act and its associated regulations.”
However, as security tokens and crypto contracts are now considered to be securities, dealing in those types of products would not be providing a product or service that is separate from securities dealer activities, so this policy interpretation does not provide additional clarity vis-à-vis whether a dealer in virtual currency that is subject to provincial securities legislation is considered to be a securities dealer or an MSB under the PCMLTFA.
As the amendments to the PCMLTFR don’t impose any obligations on securities dealers relating to the exchange or transfer of virtual currency, I would assume that the intent is to continue to regulate dealers in virtual currency as MSBs regardless of whether they are captured by provincial securities legislation, but in light of IIROC and the CSA’s joint statement, it would be nice if FINTRAC were to release an interpretative notice providing clarification on this point.
For more information on the new regulations for Crypto companies, watch this webinar hosted by The AML Shop’s Adam Feldman and Marcelle Dadoun.
On March 29th, the Canadian Securities Administrators (CSA) and the Investment Industry Regulatory Organization of Canada (IIROC) released a joint statement indicating that securities legislation could be applicable to crypto asset trading platforms (CTP) and that these platforms will be required to register with IIROC and their local securities administrator. In response, the Ontario Securities Commission (OSC) has established a deadline of April 19th for covered CTPs that are based in Ontario or that have a substantial connection to Ontario to register with the OSC.
Please find below a podcast wherein Advisors Marcelle Dadoun and Adam Feldman of The AML Shop are joined by Matthew Burgoyne, Partner and Head of the Cryptocurrency Blockchain group at McLeod Law to discuss "New Regulations for Crypto Companies'.
Advisors Marcelle Dadoun and Adam Feldman of The AML Shop are joined by Matthew Burgoyne, Partner and Head of the Cryptocurrency Blockchain group at McLeod Law to discuss "New Regulations for Crypto Companies'.
Discussed are the following topics:
- High Level overview of the CSA notice
- What we believe would not qualify as 'dealing in securities'
- What are the next steps/What do you need to do?
WATCH THE VIDEO
Matt McGuire, The AML Shop Practice Leader, recently contributed his expert insights in this Globe and Mail piece regarding the Real Estate industry and Anti-Money Laundering Regulation.
via the Globe and Mail:
“I’ve audited dozens of real estate brokerages,” said Matt McGuire, a financial crime expert who is the co-founder of The AML Shop, a 20-person consultancy that trains and audits compliance programs. “If you look [at] FINTRAC’s results from conducting examinations you’ll find that nearly all of them have had a significant deficiency."
FINTRAC has acknowledged that Covid-related staffing challenges might make it challenging to fulfil certain anti-money laundering obligations.
In their April 2020 guidance, they wrote:
“Once the COVID-19 situation normalizes and compliance activities resume, FINTRAC will consider the impact of the associated challenges, when assessing reporting entities’ compliance with the obligations identified in the PCMLTFA and its associated regulations. This will include being flexible and reasonable in assessing the ability of a reporting entity to update policies and procedures, in adhering with interim COVID-19 related measures, and effectively fulfilling certain time-bound obligations such as undertaking the two-year effectiveness review. FINTRAC will also take into account the additional time needed for reporting entities to fully address and remediate certain recommendations identified in previous FINTRAC examinations. Finally, FINTRAC will exercise careful judgement on other aspects of its examination mandate, such as determining the date of future compliance examinations.”
FINTRAC has further advised that in cases where there is an impact on a reporting entity’s ability to meet a given obligation, including the use of temporarily relaxed identification rules, the entity should keep a record indicating that deviation, why it occurred, and, where possible, include any measures being taken to mitigate the risk of non-compliance.
In view of the same, it would be noteworthy for reporting entities to keep and maintain a documented record (such as an issues log) for any non-compliances in view of Covid-19 and such record could be valuable at the time of future FINTRAC examinations.
The AML Shop is honoured to be selected as a delegate from one of 8 innovative Canadian Fintech companies, to participate in the #fintech trade mission to the UAE.
This significant initiative is organized by Toronto Finance International in partnership with the Trade Commissioner Service I Service des délégués commerciaux at the Consulate General of Canada in Dubai.
“Anti-money laundering, counter-terrorist financing and sanctions standards are based on a global framework, and we are experts in meeting those expectations. Many of our clients have reach into the UAE, and we are excited about the opportunity to provide cross-border support
to the existing financial services and growing fintech sectors there.”
- Matt McGuire, The AML Shop Practice Leader
One of the biggest compliance-related challenges for reporting entities/covered institutions is the ever-evolving nature of regulations and legislations in the sanctions domain.
As a recent trend, sanctions are being used in ways never seen before. This is a must read for institutions navigating the sometime muddy waters of sanctions.
FINTRAC published new guidance related to politically exposed persons (“PEP”) and heads of international organizations (“HIO”), family members and close associates that comes into effect June 1, 2021.
The AML Shop Advisor Marcelle Dadoun has performed a comparison of the current FINTRAC regulations versus the new regulations coming June 2021. Click the button below to read the full analysis.
On February 15th, Matt McGuire, The AML Shop Practice leader appeared as a guest on the Canadian Blockchain Consortium’s podcast to give his unique insights on the regulatory challenges facing cryptocurrencies in Canada, how digital asset businesses can optimize their compliance, and what the growing adoption of Bitcoin by major corporations means for the industry.
About the podcast:
This engaging discussion on regulatory matters and compliance for crypto currencies and digital asset businesses is a must view for any company looking to increase their awareness of current topics and challenges in this space. Watch the entire podcast below (via the Canadian Blockchain Consortium).
Matt McGuire, Practice Director, from The AML Shop recently participated in a Webinar that discussed Sanctions, US law and the impacts on crypto business. Watch the video recording below from the Canadian Blockchain Consortium.
About the Webinar:
With the rapid adoption of cryptocurrencies like Bitcoin, compliance is taking centre stage - and many custodians and digital asset platforms are falling short. In particular, failure to comply with Know-Your-Client regulations and investment restrictions applied by the United States government can have a massive impact and result in major fines for digital asset companies. Discover in this insightful Canadian Blockchain Consortium seminar ways that the laws enforced by the Office of Foreign Assets Control impact digital currency investment and restrict client jurisdictions and strategies for keeping aware and compliant.
Eugenio (Gene) DiMira CAMS-Audit, CGSS from The AML Shop recently participated in a panel discussing financial crime in the context of mergers and acquisitions. Watch the video recording below. Thanks to iComply Investor Services.
In a Merger and Acquisition (M&A) transaction, due diligence is a critical step to take in providing both parties the assurance that all risks and rewards ha...
Each year, the Chartered Professional Accountants of Ontario bestow its absolute highest honour on what makes up only 1% of its total profession in the province; a Fellow of the Institute of Chartered Accountants.
The AML Shop’s very own Co-Founder and Practice Leader, Matthew McGuire is one of this year’s recipients and was honoured at the Fellows Evening of Distinction virtual event on December 3, hosted by Peter Mansbridge.
Fellows are nominated by their peers and industry leaders which hold such merit and integrity. The criteria that the nominating and judging committees look for are beyond exemplary such as the commitment to a Fellow’s present impact on their profession as well as their genuine desire to pay it forward with the intention to keep the CPA industry strong and diverse.
The distinction of Fellow formally recognizes CPAs who have rendered exceptional service to the profession and in their communities. They exemplify the breadth and depth of the profession and pave pathways for the next generation of CPAs. It is the highest honour conferred by the profession.
Congratulations Matt!
We are moving our December 1st live webinar to a recorded version that will be shared with anyone who requests it. We've made this change because the Annual Canadian Money Services Businesses Association Conference has moved to the same time, featuring two of our AML Shop experts as panelists on a similar topic.
Please email Shamela Styles, our Director of First Impressions, shamela@theamlshop.ca. She will ensure you are on the list to receive the recording when it is available after December 1st. Here are the details about The Travel Rule and Virtual Currency: No Quarantine Required:
When we hear anything involving the word travel these days, we either long for a sunny beach or wish that quarantine hadn’t become a part of our daily vocabulary.
The AML Shop is switching it up and talking travel...AML style! If you’re a dealer in virtual currency or have an interest in this space, you’ll want a copy of our webinar recording to learn about the intent and impact of the travel rule as it relates to AML regulations.
We’ve assembled an expert panel that will engage attendees in topics such as:
The travel rule in general;
Some of the challenges associated with complying with the travel rule;
The impact regulations have had on the virtual currency space;
The future of virtual currency regulations.
We would love to hear from you! As it pertains to this webinar about the travel rule, what are your questions or ideas that you'd like our panelists to cover? We'll review all of your feedback and include it where we can, perhaps even in a follow-up webinar! Email Shamela to request the recording or to submit your ideas.
The AML Shop has created a rigorous document to help guide credit union leadership in meeting and exceeding its AML program with the expertise of its CAMLO. With so many changes and evolving industries and sectors coming to credit unions for financial guidance and services, applying these questions and having open discussions around them will set your AML compliance team up for success.
What are the key vulnerabilities of the credit union to money laundering, based on: its region; what we have observed in our own monitoring and reporting; what we have learned from our peers; and what we have read in authoritative publications?
Which member types and products and services pose the greatest money laundering risk to the credit union? Do we, for instance, deal with clients in these sectors (how can we be certain we don’t), and how do we control the risk of their activities? Are any of these activities beyond our risk tolerance?
a) Alternative financial services providers – principals and agents (money services businesses, cheque cashing, payday lenders, foreign exchange dealers, cryptocurrency companies, prepaid card players, ATMs)
b) Cash-intensive businesses
c) Cannabis related businesses
d) Firms or lawyers, accountants, or corporate service providers
e) Gaming related businesses
f) Dealers in high-value goods
g) Adult services and goods
What are the controls we lean on the most to limit our vulnerabilities, how are they tested, and what have the results been of the most recent tests?
Does the CAMLO have sufficient training, resources and access to ensure their role is performed effectively, even during their absences, and considering existing issues log and changes to standards? Are they willing to so certify?
Have there been any material changes in regulatory reporting trends (large cash transaction reports, electronic funds transfer reports, suspicious transaction reports), in terms of volume, dollar value, and timeliness? What explains those variations?
a) What was the nature of the activity disclosed in suspicious transaction reports?
How have we ensured that technology that we use to risk rate clients, monitor their transactions, and file regulatory reports are configured properly to address salient risks, and operate effectively?
How have we ensured that third parties have acted in accordance with our standards, including, for instance, agents and service providers.
What were the nature of, and how have we dealt with sensitive AML situations?
a) Requests from law enforcement or revenue agencies?
b) Repeated suspicious transaction reports involving one member?
c) Demarketing of clients?
d) Employees who have not completed their training, or have repeatedly failed to apply policies and procedures?
What have been the outcomes of interactions with prudential regulators and FINTRAC regarding anti-money laundering compliance, including results of examinations, policy interpretations and voluntary disclosures?
What are the qualifications of the individual conducting the compliance effectiveness review, what as the scope and methodology of their review, have their findings been challenged/contradicted by regulators in their prior examinations of the credit union?
What evidence do we have that material findings from prior self-assessments, compliance effectiveness reviews, and regulatory examinations are being addressed?
What changes in the legislation or guidance around anti-money laundering will cause a material impact to our credit union?
For more information, please connect with us directly, and also click on the following button to view a PDF version of these 12 rules.
FOR IMMEDIATE RELEASE - Toronto, ON - The AML Shop, Canada’s top Anti-Money Laundering firm, announces the appointment of Eugenio (Gene) DiMira, CAMS-Audit, CGSS as Chief Identity Officer.
Gene DiMira is an internationally recognized anti-money laundering expert and an industry innovator in digital identity. He spent the last decade as the Head of Global Compliance Anti-Money Laundering/Counter-Terrorist Financing programs at Manulife.
Financial services evolution has driven legacy financial services providers and fintechs alike to seek digital, automated and intelligent approaches to fighting financial crime while managing compliance obligations. In Gene, The AML Shop found a thought leader and practical guide to help its clients to navigate this new landscape.
Monika Cywinska, Co-Founder and Chief Operating Officer at The AML Shop says, “We are excited to have Gene, one of the experts at the forefront of compliance and financial crime risk management, join our team. The market is demanding a frictionless online experience, whether it’s getting a mortgage, buying insurance, or sending money abroad. At the same time, regulators are expecting more confidence about Know Your Customer (KYC) as a meaningful baseline to risk monitoring, and the preservation of privacy. Gene and our team can help financial services and regulatory technology companies meet those challenges with intelligent approaches and proven tools.”
Gene shares, “My thought process begins with ‘digital first’, meaning that a new way of thinking is required to how we collect, trust and manage information for faster, reliable and effective delivery of services. If we create our work as future ready, then we stay agile to adapt as the current pace of technology requires.” I look forward to bringing this philosophy to The AML Shop and creating a balanced hub where digital ID and AML initiatives lead the evolution.”
Gene has contributed to the authorship of domestic and Financial Action Task Force standards, spoken extensively on the subject, designed and conducted extensive surveys of international digital identity providers, and selected and implemented those tools.
Gene will continue his advocacy and policy development through The AML Shop with organizations such as the Digital ID and Authentication Council of Canada (DIACC) where he serves as Co-Chair of the Outreach Expert Committee, helping to bring digital-first methods to the Canadian Market in a manner that informs and reduces risk.
Gene’s addition to The AML Shop is a natural alignment of the international strengths and expertise that both he and the company have built over decades of experience. The AML Shop’s strategies and team of veteran advisors are what make it the leading source for anti-money laundering compliance and digital identity expertise in Canada. experience.
For more information:
Matthew McGuire, Practice Leader matt@theamlshop.ca
About The AML Shop
Our team of veteran compliance advisors share our goals to help clients manage their risks, maximize their opportunities and achieve and maintain compliance. We provide: expert advice; support with regulatory exams; development and reviews of financial crime compliance and risk management programs; assistance with the validation of AML technology; and the management or staffing of your compliance functions and compliance teams. We serve clients across Canada in every regulated sector and in emerging industries with a specialty in FinTech and Cryptocurrency.
If you’re a fan of our webinar series, you know that we love to keep our guests hopping with the most up-to-date content and subject matter experts (sprinkled with a little fun of course, too).
Beneficial ownership is a hot topic everywhere right now and we thought that instead of sharing the facts and features of how it’s working (or not working), why not invite the product experts in to showcase their solutions that can make a real difference in your operations?
Join our presentation with industry leaders in the know your business (KYB) space who offer solutions that can help reporting entities meet their regulatory obligations to obtain and verify the information about the beneficial owners of their entity clients.
When? October 27, 2020 at Noon, EST.
Your takeaway from this vendor showcase will be a better understanding of the regulatory technology (RegTech) options that are available to assist with compliance with beneficial ownership requirements.
In addition to financial entities, life insurance companies, brokers and agents, MSBs and securities dealers, already have obligations to obtain and verify information about the beneficial owners of entity clients. As of June 2021, these obligations will also apply to a variety of other reporting entities, including accountants and accounting firms, casinos, dealers in precious metals and stones and real estate brokers, developers and sales reps.
This webinar will exhibit real solutions that aim to help comply with these obligations while minimizing customer friction - and who doesn’t want to achieve that at a time when beneficial ownership is under the microscope?
Register now as our seats fill quickly and we look forward to seeing you on October 27th.
Have you ever wondered what happens in the AML process after you submit a Suspicious Transaction Report (STR), or turn things over to local law enforcement?
Join our webinar on Thursday September 17, 2020 from Noon to 1:15pm EST for the most valuable and interesting conversations with RCMP veterans’ first-hand knowledge of how law enforcement is working towards better supporting the AML industry.
As AML professionals, we have a significant and evolving role in the investigation of money laundering offences in Canada. We do our best at monitoring and reporting one side of the AML equation. Law enforcement, specifically the RCMP, has a huge role to play when it comes to investigating and prosecuting money laundering criminals.
Meet Corporal Steve Harten with the Toronto North division of the RCMP. He’s spent many years in the drug squad and now spends his time fighting financial crime which has direct ties to the money laundering efforts of the RCMP.
Cpl. Harten will be our special guest panelist where he will present two money laundering cases that will demonstrate how money is laundered and generated under the organized crime umbrella. He will candidly share his experiences based on his time investigating drug crimes and now, money laundering enforcement.
Cpl. Harten was a key player in Canada’s first successful federal seizure and forfeiture of Bitcoin and will share his knowledge on how the RCMP’s foundation for success affects and protects our industry.
This candid conversation with Cpl. Harten will also include one of the top veteran experts of the AML industry, Garry Clement, former National Director, RCMP Proceeds of Crime Project, and current Adjunct Advisor at The AML Shop. This dynamic duo of AML super-powers will ensure that this 75-minute webinar is the most valuable content you’ll see all year.
You’ll walk away with a better understanding of:
The evolution of the RCMP’s financial crime strategy and its challenges. This will cover the mandate of the RCMP’s money laundering program and how it has changed in light of COVID.
Current trends in AML and trends in current investigative strategies.
Cryptocurrency initiatives and how the RCMP is ramping up its efforts to coordinate with dealers in virtual currency and to investigate crypto-laundering.
See you on Thursday September 17, 2020, at Noon EST. To register, please click here. As this is a complimentary webinar, feel free to share this with your colleagues.
After so much uncertainty with the COVID-19 interruptions, are you wondering about when or if a review will happen? While these have taken a back burner, last week it was announced that FINTRAC would in fact be resuming these exams.
https://www.fintrac-canafe.gc.ca/covid19/covid-2020-07-27-eng
As you read about FINTRAC’s plans, be sure to check out how The AML Shop is helping to guide clients through each stage of a review. We are with you every step of the way to ensure you are set up for success.
Check out this useful link to our website where you can learn all about how we are serving our clients during COVID:
https://www.theamlshop.ca/aml-and-sanctions-assessments-reviews-and-examination-support
