Landmark AML Fine Levied Against Canadian Bank

April 6, 2016

Making history today, an unnamed Canadian bank has been fined $1.1 million by FinTRAC—the Financial Transactions and Reports Analysis Centre of Canada—for not reporting a suspicious transaction and a number of money transfers. Other banks and financial institutions across the country are taking note of this landmark penalty, which is the first ever levied on a bank by FinTRAC in its mission to encourage compliance with the Proceeds of Crime (Money Laundering) and Terrorism Financing Act.

The fine was levied against the unidentified bank because it failed to report:

  • A suspicious transaction (attempted or actual);
  • Receipt of more than $10,000 in one transaction;
  • An e-transfer of more than $10,000 to a location outside of Canada; and
  • Receipt of an e-transfer of more than $10,000 from a location outside of Canada.

The bank also faced penalties because it didn’t enforce written compliance policies and procedures that are kept current and are approved by a senior officer within the organization. The fine, which is the biggest administrative penalty doled out by FinTRAC since 2008, has reportedly been paid by the bank.

A FinTRAC representative stated that Canadian banks have a generally good history of compliance, and also noted that this fine is meant to act as a deterrent to other Canadian financial institutions. Financial crimes risk-management expert Matthew McGuire of Securefact noted that although FinTRAC initially levied only very small penalties on money services businesses (MSBs) and small real estate brokerages, the fines have increased over time and FinTRAC is setting its sights on larger cases.

Across Canada, 31,000 businesses are required to provide reports to FinTRAC on suspicious transactions. In 2014–2015 alone, FinTRAC—which reports to the Canadian Minister of Finance—received more than 92,000 suspicious transaction reports and submitted 1,260 financial intelligence disclosures to police and national security partners.

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About Anu Sood:

Anu Sood is the Director of Product and Corporate Marketing at CaseWare Analytics and is responsible for the company’s global marketing strategy. Prior to CaseWare Analytics, Anu worked in various roles in the high-tech industry and her accomplishments range from writing software for telephone switches to launching a new global satellite communication service. Anu has extensive experience in strategic marketing, corporate communications, demand generation, content marketing, product management, product marketing and technology development. 

Connect:   Anu Sood

 

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