FINTRAC Financial Transactions and Reports Analysis Centre of Canada

Founded in 2000, the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) is the nation's financial intelligence unit (FIU), operating under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA) and its associated regulations.

As a standalone agency located in Ottawa, FINTRAC is an independent government agency with a mandate to identify, deter, and prevent money laundering, terrorist financing, and other threats to the country's financial security.While it is independent, FINTRAC is accountable to Canada's Department of Finance.

Purpose and Mandate

FINTRAC's primary mission is to protect the integrity of Canada's financial system and promote economic transparency and accountability. Specifically, FINTRAC collects, analyzes, and discloses information regarding financial transactions to support investigative and intelligence work that helps reduce the risk of crime. Under its mandate, FINTRAC will focus its efforts mainly on three areas:

• Anti-Money Laundering (AML)

o Monitoring and analyzing financial crimes, and assessing whether certain financial activities can be linked to the proceeds of illegal activity.

• Counter-Terrorist Financing (CTF)

o Identifying trends and/or suspicious transactions that may be linked to the financing of terrorism.

• Enhancing the level of financial transparency domestically and globally.

Roles and Responsibilities

1.Collecting and analyzing reports

FINTRAC collects reports and data from numerous entities covered under the PCMLTFA.Examples of reporting and collecting entities include credit unions, banks, insurance companies, money services businesses, securities dealers, and casinos.The reports, submitted by the identified entities, cover the following areas:

• Suspicious Transaction Reports (STRs)

• Large Cash Transaction Reports (LCTRs)

• Electronic Funds Transfer Reports (EFTRs)

• Buying or selling of securities reports

2.Sharing financial intelligence

• Providing information to law enforcement (e.g., RCMP and CSIS) and/or national security-related agencies.

• Working closely with international organizations and FIUs to assist and/or facilitate international investigations coordinated and/or facilitated by agencies and intelligence services.

3.Ensure compliance

• Monitoring reporting entities to assess their compliance with AML and CTF rules and regulations.

• Ability to impose administrative monetary penalties and/or other enforcement acts.

International Cooperation

FINTRAC communicates and interacts with most global regulatory bodies to identify opportunities to share information and ensure consistency with internationally accepted financial risk-based regulatory expectations. FINTRAC is a part of an international community that includes:

• Egmont Group - a global network of FIUs and government agencies that promote and foster the use of secure channels for exchanging intelligence.

• Financial Action Task Force (FATF) - engaged in mutual evaluations (i.e., assessment and auditing) as a part of the FATF framework for international AML/CFT compliance activities.

• Agreements with operation FIUs that permit law enforcement and selected intelligence services to monitor and/or investigate cross-border financial transactions that are being tracked and analyzed by law enforcement.

Legal Framework

FINTRAC only operates in accordance with the authority to do so pursuant to the provisions and rules outlined in the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA) and its regulations.

Although FINTRAC does not possess lawful authority to freeze bank accounts or apprehend individuals, it can provide comprehensive reports on intelligence relating to the transactions of Canadian citizens on behalf of law enforcement, national security agencies, or other authorized entities to assist in investigations involving the enforcement of Canadian laws.

Role in Canada's Financial System

As one of Canada's cornerstones of the delivery of financial intelligence, FINTRAC has tremendous capabilities to reduce the risk of:

• Criminal organizations are exploiting the banking system or financial networks.

• Vulnerability of the country to money laundering or terrorist financing activities.

• To allow Canada to remain fully aligned with the FATF international standards for not only compliance but to protect Canada's reputation as a leading nation in the global markets.