Changes to Canada’s anti-money laundering regime

ELI Canada

In an era marked by ever-changing commercial dynamics, the significance of robust anti-money laundering (AML) measures cannot be overstated. Acknowledging the necessity for adaptability and remaining ahead of emerging threats, the Canadian government has recently introduced substantial modifications to Canada’s framework. These alterations, elucidated in the Notice of Ways and Means Motion unveiled on April 21, 2023, signify a strategic stride toward strengthening the nation’s financial sector against the multifaceted challenges.

Sanctions Reporting Responsibilities

One of the most noteworthy augmentations in the revised framework concerns sanctions reporting. Heretofore, the framework obligated regulated entities to communicate instances of matching with terrorist sanctions lists, an indispensable component in the global fight against terrorism. The freshly introduced amendments take this imperative a notch higher by extending reporting duties to encompass remittances emanating from the Special Economic Measures Act and the Justice for Victims of Corrupt Foreign Officials Act (Sergei Magnitsky Law). This heightened breadth reflects Canada’s unwavering dedication to not only counteracting terrorism but also to addressing fiscal transgressions and preserving the inviolability of its monetary domain.

Money Services Businesses (MSBs)

In an epoch characterized by intricate monetary maneuvers and evolving criminal stratagems, the revamped framework perceptively discerns the vulnerabilities embedded within the money services sector. A cardinal facet of the amendments pertains to the imposition of exacting due diligence prerequisites on domestic MSBs that engage agents in their operations. Termed the “know your agent” stipulation, this inclusion mandates that MSBs conduct comprehensive background verifications on their agents to ensure their ethical standing and adherence to regulatory norms. The amendments stipulate that these agents should remain unblemished by Canadian sanctions, devoid of prior convictions linked to such violations, and free from associations with specified drug trafficking infractions. This proactive provision underscores the role of MSBs as active sentinels against clandestine fiscal actions.

Shielding and Transparency

Recognizing the pivotal role that employees assume in unmasking financial misfeasance, the revised framework introduces resolute safeguards for whistleblowers. As per these provisions, employers are proscribed from engaging in retaliatory measures against employees who report suspicious remittances or fulfill their obligations under the framework. This robust protection fosters an atmosphere of transparency and ethical conduct within regulated entities, nurturing an environment where financial misdemeanors are more likely to be unearthed and reported.

Structured Transactions

In line with global trends steering the battle against violations, the revised framework presently codifies structured transactions as a transgression. This demonstrates a nuanced grasp of the stratagems employed by financial malefactors. The framework now takes cognizance not merely of the transaction itself but also the underlying intent behind structured financial transactions designed to circumvent mandatory reporting criteria. By deeming structuring a criminal act, Canada amplifies its bulwarks against methodologies employed to launder money.

Enhanced Ministerial Directives Authority

An intrinsic facet of the amendments bestows augmented prerogatives upon the Minister to issue directives in instances where foreign entities, individuals, or nations pose a threat to Canada’s fiscal robustness and security. This enlargement of authority equips the government with a versatile instrument to counter emerging threats that could jeopardize the credibility of the financial system.

Deterrent Penalties

To further reinforce the framework, the amendments introduce sterner enforcement mechanisms. The FINTRAC is now endowed with the authority to rescind the registration of an MSB for non-cooperation or the withholding of vital data. Additionally, unregistered MSBs engaging in financial operations sans proper registration now confront substantial penalties of up to C$500,000, coupled with a maximum five-year term of incarceration.


The sweeping transformations to Canada’s anti-money laundering framework underline the nation’s unwavering commitment to combat monetary crimes and uphold the integrity of its monetary system. Through the expansion of reporting obligations, the enhancement of due diligence practices, and the imposition of stricter penalties, Canada takes proactive measures to safeguard its monetary institutions, enhance its repute, and synchronize its efforts with the worldwide AML campaign. As these changes metamorphose into active measures, they are poised to reshape the field of anti-violation methodologies in Canada. This reaffirms the nation’s dedication to prudent monetary governance and its pivotal role in the global crusade against clandestine monetary actions.

Contact Us

1055 West Georgia St. BC V6E 3P3