FINTRAC and MONEY LAUNDERING
Effective April 1, 2025 all dealers who finance or lease passenger class vehicles (or other vehicles valued over $100,000) will be expected to:
- implement an Anti-Money Laundering compliance program
- comply with FINTRAC customer verification requirements
- be required to report a variety of types of transactions to FINTRAC
- keep records according to FINTRAC guidelines
A financing or leasing entity is subject to the Act and associated Regulations when they engage in the financing or leasing of:
- property for business purposes, other than real property or immovables
- property valued at $100,000 or more, other than real property or immovables
- passenger vehicles in Canada
A passenger vehicle is a motor vehicle – other than an ambulance, a hearse, a motor vehicle that is clearly marked for policing activities, a motor vehicle that is clearly marked and equipped for emergency medical response activities or emergency fire response activities or a utility truck – that is designed or adapted primarily to carry no more than 10 individuals on highways and streets.
FINTRAC have signaled that, for the first year, they are going to focus on education rather than enforcement:
“In the first year following the coming into force dates, FINTRAC will put emphasis on engagement, outreach and guidance activities related to new regulatory obligations in order to foster greater awareness and understanding amongst new reporting entities. This will include industry consultation to develop guidance so new reporting entities will be well positioned to implement and mature their compliance programs.”
The FINTRAC link contains useful guidance on how you can set yourself up for compliance and avoid the fines and penalties for failing to do so by 2026: