In Canada, real estate agents are required to comply with anti-money laundering and anti-terrorist financing regulations set out by the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC).
We at Vancouver New Condos take our regulatory responsibilities seriously and support this program aside from the fact that we are required to.
FINTRAC Requirements for Realtors
The following is a summary of the requirements for real estate agents outlined by FINTRAC when representing all buyers and sellers in Canada. Please note that Realtors are required to fill out a FINTRAC when representing the buyers of condo presales
Compliance program: Real estate agents must develop and implement a compliance program that includes written policies and procedures to detect and prevent money laundering and terrorist financing. The compliance program must be tailored to the nature, size, and complexity of the business and must include ongoing training for employees.
Risk assessment: Real estate agents must conduct a risk assessment of their business activities to determine the level of money laundering and terrorist financing risk. This assessment must be reviewed and updated regularly.
Client identification: Real estate agents must identify their clients by obtaining and verifying their name, date of birth, address, and occupation. If the client is a corporation or other legal entity, the agent must obtain and verify the name, address, and occupation of the entity, as well as the names and positions of the entity’s directors and senior officers.
Record keeping: Real estate agents must keep records of all transactions and client identification information for at least five years after the completion of the transaction. These records must be kept in a way that allows them to be easily retrieved and provided to FINTRAC upon request.
Reporting: Real estate agents are required to report certain transactions to FINTRAC, including any transaction that involves $10,000 or more in cash or virtual currency, or any suspicious transaction. Suspicious transactions are those that have no apparent lawful purpose or are conducted in a manner that is inconsistent with a client’s known or stated legitimate business.
Training: Real estate agents must ensure that all employees are trained on the compliance program, including their roles and responsibilities, and on the requirements of the Proceeds of Crime (Money Laundering) and Terrorist Financing Act and its regulations.
Penalties: Failure to comply with these requirements can result in penalties and fines, as well as reputational damage to the agent and their business.
It’s important to note that these requirements apply to all real estate agents in Canada, regardless of the size or nature of their business. By complying with these regulations, real estate agents can help prevent money laundering and terrorist financing, protect their business and clients, and contribute to the overall integrity of Canada’s financial system.