Definition
FINTRAC (Financial Transactions and Reports Analysis Centre of Canada) is the federal agency overseeing money laundering and terrorist financing. Under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA), mortgage brokers are designated reporting entities.
Broker obligations: - **Identity verification**: identify each client (photo ID, passport) before submitting an application or receiving funds. - **Record keeping**: retain identification information for 5 years after the end of the business relationship. - **Mandatory reports**: report large cash transactions ($10,000 and over), electronic funds transfers of $10,000 and over, and suspicious transactions without minimum threshold. - **Compliance program**: brokerage firms must have a written PCMLTFA compliance program, a designated compliance officer, and a risk assessment.
Penalties for non-compliance can reach $500,000 per violation. FCAM (Council of Regulatory Organizations) monitors FINTRAC compliance in provinces that regulate mortgage brokers.