The Financial Action Task Force (FATF) has completed an assessment of the implementation of anti-money laundering and counter-terrorist financing (AML/CFT) standards in Canada. Among its major findings were:
- Canada has recently introduced a significant set of new preventive measures that aim to implement the FATF standards in the financial and non-financial sectors. When these new requirements enter into force (in June and December 2008), the AML/CFT system should be significantly strengthened.
- The money laundering and terrorist financing offences, and powers to confiscate and freeze, are comprehensive, but further steps could be taken to enhance effective implementation.
- The Canadian FIU, FINTRAC, has extensive powers and responsibilities concerning suspected money laundering and terrorist financing. However, there are serious issues in relation to its effectiveness.
- The powers and investigative of law enforcement authorities are sound and they have taken significant action to combat money laundering.
- The preventive system requirements are variable, and do not apply to the full range of financial institutions or designated non-financial businesses and professions as defined by the FATF. Measures on issues such as record-keeping, suspicious transaction reporting and internal controls are satisfactory, and basic customer identification measures are in place. However, with the exception of the securities sector, more extensive customer due diligence requirements are needed, including on issues such as beneficial ownership, ongoing due diligence, and measures with respect to politically exposed persons. Many of these required measures are addressed by the new regulations that come into force in 2008.
- FINTRAC has overall responsibility for ensuring all entities’ compliance with AML/CFT provisions. While supervisory action in certain sectors, such as banking, securities and insurance is strong, overall, there are unequal degrees of supervision across the financial sector and between the non-financial businesses.
- In relation to international co-operation in AML/CFT matters, Canada is broadly in line with the international standards.
For further information, journalists are invited to contact Helen Fisher, OECD Media Relations (tel: +33 1 45 24 80 97, email: firstname.lastname@example.org) or the FATF Secretariat (tel: +33 1 45 24 79 45, fax: +33 1 44 30 61 37, email: email@example.com); 2, rue André-Pascal, 75775 Paris Cedex 16, FRANCE.
This mutual evaluation was conducted using the FATF Recommendations as published in October 2004, and the 2004 Methodology for Assessing Compliance with the FATF 40 Recommendations and FATF 9 Special Recommendations.