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Proceeds of Crime (Money Laundering) and Terrorist Financing Act (S.C. 2000, c. 17)

Act current to 2021-11-17 and last amended on 2021-06-29. Previous Versions

PART 4.1Notices of Violation, Compliance Agreements and Penalties (continued)

Violations (continued)

Marginal note:Criteria for penalty

 Except if a penalty is fixed under paragraph 73.1(1)(c), the amount of a penalty shall, in each case, be determined taking into account that penalties have as their purpose to encourage compliance with this Act rather than to punish, the harm done by the violation and any other criteria that may be prescribed by regulation.

  • 2006, c. 12, s. 40

Marginal note:How contravention may be proceeded with

 If a contravention that is designated under paragraph 73.1(1)(a) can be proceeded with either as a violation or as an offence under this Act, proceeding in one manner precludes proceeding in the other.

  • 2006, c. 12, s. 40

Marginal note:Commission of violation

  •  (1) Every contravention that is designated under paragraph 73.1(1)(a) constitutes a violation and the person who commits the violation is liable to a penalty determined in accordance with sections 73.1 and 73.11.

  • Marginal note:Notice of violation or compliance agreement

    (2) If the Centre believes on reasonable grounds that a person or entity has committed a violation, the Centre may

    • (a) issue and cause to be served on the person or entity a notice of violation; or

    • (b) issue and cause to be served on the person or entity a notice of violation with an offer to reduce by half the penalty proposed in the notice if the person or entity enters into a compliance agreement with the Centre in respect of the provision to which the violation relates.

  • 2006, c. 12, s. 40

Notices of Violation

Marginal note:Contents of notice

  •  (1) When the Centre issues a notice of violation under subsection 73.13(2), the notice shall name the person or entity believed to have committed a violation, identify the violation and set out

    • (a) the penalty that the Centre proposes to impose;

    • (b) the right of the person or entity, within 30 days after the day on which the notice is served or within any longer period that the Centre specifies, to pay the penalty or to make representations to the Director with respect to the violation and the proposed penalty, and the manner for doing so; and

    • (c) the fact that, if the person or entity does not pay the penalty or make representations in accordance with the notice, the person or entity will be deemed to have committed the violation and the Centre will impose the penalty in respect of it.

  • Marginal note:Administrative corrections

    (2) If a notice of violation contains any error or omission, the Centre may serve a corrected notice of violation on the person or entity at any time during the period referred to in paragraph (1)(b).

  • 2006, c. 12, s. 40

Marginal note:Payment of penalty

  •  (1) If the person or entity pays the penalty proposed in the notice of violation, the person is deemed to have committed the violation and proceedings in respect of it are ended.

  • Marginal note:Representations to Director

    (2) If the person or entity makes representations in accordance with the notice, the Director shall decide, on a balance of probabilities, whether the person or entity committed the violation and, if so, may, subject to any regulations made under paragraph 73.1(1)(c), impose the penalty proposed, a lesser penalty or no penalty.

  • Marginal note:Failure to pay or make representations

    (3) A person or entity that neither pays the penalty nor makes representations in accordance with the notice is deemed to have committed the violation and the Centre shall impose the penalty proposed in the notice.

  • Marginal note:Notice of decision and right of appeal

    (4) The Director shall cause notice of any decision made under subsection (2) or the penalty imposed under subsection (3) to be issued and served on the person or entity together with, in the case of a decision made under subsection (2) in respect of a serious violation or very serious violation, notice of the right of appeal under subsection 73.21(1).

  • 2006, c. 12, s. 40
  • 2017, c. 20, s. 435(F)

Compliance Agreements

Marginal note:Contents of compliance agreement

  •  (1) When the Centre offers to enter into a compliance agreement under paragraph 73.13(2)(b), the agreement shall

    • (a) identify the violation and provide that the person or entity will comply with the provision to which the violation relates within the period, and be subject to the terms and conditions, specified in the agreement; and

    • (b) set out the amount that the person or entity will have to pay as the reduced penalty for the violation if the compliance agreement is entered into.

  • Marginal note:Refusal to enter into agreement

    (2) The person or entity shall enter into the compliance agreement and pay the reduced penalty within 10 days after receiving the notice of violation and, if it does not do so, the person or entity is deemed to have refused to enter into the agreement, and the full penalty proposed in the notice of violation and section 73.15 apply.

  • Marginal note:Extension of period

    (3) The Centre may extend the period referred to in paragraph (1)(a) if the Centre is satisfied that the person or entity with which the compliance agreement was entered into is unable to comply with it within that period for reasons beyond their control.

  • 2006, c. 12, s. 40

Marginal note:Compliance agreement complied with

 If the Centre considers that a compliance agreement has been complied with, the Centre shall serve a notice to that effect on the person or entity and, on the service of the notice, no further proceedings may be taken against the person or entity with respect to the violation.

  • 2006, c. 12, s. 40

Marginal note:Compliance agreement not complied with

  •  (1) If the Centre considers that a compliance agreement has not been complied with, the Centre may issue and serve a notice of default on the person or entity to the effect that the person or entity is liable to pay the remainder of the penalty set out in the notice of violation and a prescribed additional penalty.

  • Marginal note:Contents of notice

    (2) A notice of default shall include the date, which shall be 30 days after the day on which the notice is served, on or before which an application for review may be filed and particulars of how the application may be filed.

  • Marginal note:No set-off or compensation

    (3) On the service of a notice of default, the person or entity served has no right of set-off or compensation against any amount that they spent under the compliance agreement.

  • 2006, c. 12, s. 40

Marginal note:Application for review

  •  (1) A person or entity served with a notice of default under subsection 73.18(1) may, on or before the date specified in the notice or within any further time that the Centre allows, file an application for review by the Director.

  • Marginal note:Review

    (2) The Director may confirm the Centre’s decision or decide that the person or entity has complied with the compliance agreement.

  • Marginal note:Failure to pay or apply for review

    (3) A person or entity that neither pays the amounts set out in the notice of default nor files an application for review in accordance with the notice is deemed to have not complied with the compliance agreement and shall pay the amounts without delay.

  • Marginal note:Notice of decision and right of appeal

    (4) The Director shall cause notice of the decision to be issued and served on the person or entity together with, in the case of a serious violation or very serious violation, notice of the right of appeal under subsection 73.21(1).

  • 2006, c. 12, s. 40

Marginal note:Deemed violation

 A person or entity that enters into a compliance agreement is deemed to have committed the violation in respect of which the agreement was entered into.

  • 2006, c. 12, s. 40

Appeal to Federal Court

Marginal note:Right of appeal

  •  (1) A person or entity on which a notice of a decision made under subsection 73.15(2) or 73.19(2) is served, in respect of a serious violation or very serious violation, may, within 30 days after the day on which the notice is served, or within any longer period that the Court allows, appeal the decision to the Federal Court.

  • Marginal note:Appeal — no notice of decision

    (2) If the Director does not cause notice of a decision to be issued and served under subsection 73.15(4) within 90 days after the completion of representations made under subsection 73.15(2), the person or entity that made the representations may appeal the penalty proposed in the notice of violation to the Federal Court, within 30 days after the day on which the 90-day period expires.

  • Marginal note:Appeal — no notice of decision

    (3) If the Director does not cause notice of a decision to be issued and served under subsection 73.19(4) within 90 days after the day on which the Director received the application for review under subsection 73.19(1), the person or entity that filed the application may appeal to the Federal Court the amounts set out in the notice of default referred to in subsection 73.18(1), within 30 days after the day on which the 90-day period expires.

  • Marginal note:Precautions against disclosure

    (4) In an appeal, the Court shall take every reasonable precaution, including, when appropriate, conducting hearings in private, to avoid the disclosure by the Court or any person or entity of information referred to in subsection 55(1).

  • Marginal note:Exception

    (4.1) Subsection (4) does not apply to the following information:

    • (a) the name of the person or entity that was served with the notice of violation;

    • (b) the nature of the violation; and

    • (c) the amount of the penalty imposed.

  • Marginal note:Powers of Court

    (5) On an appeal, the Court may confirm, set aside or, subject to any regulations made under paragraph 73.1(1)(c), vary the decision of the Director.

Publication

Marginal note:Publication

 In the following cases, the Centre shall make public, as soon as feasible, the nature of the violation or the default, as the case may be, the name of the person or entity and the amount of the applicable penalty:

  • (a) a person or entity is deemed to have committed a violation under subsection 73.15(1) or (3);

  • (b) a person or entity is served with a notice of a decision made under subsection 73.15(2) indicating that they have committed a violation;

  • (c) a person or entity enters into a compliance agreement with the Centre;

  • (d) a person or entity is issued a notice of default in respect of a compliance agreement they have entered into with the Centre and they

    • (i) pay the amount they are liable to pay under subsection 73.18(1),

    • (ii) are served with a notice of a decision made under subsection 73.19(2) confirming the Centre’s decision that the compliance agreement has not been complied with, or

    • (iii) are deemed under subsection 73.19(3) to have not complied with the compliance agreement.

Rules about Violations

Marginal note:Violations not offences

  •  (1) For greater certainty, a violation is not an offence.

  • Marginal note:Non-application of section 126 of the Criminal Code

    (2) Section 126 of the Criminal Code does not apply in respect of any obligation or prohibition under this Act whose contravention is a violation under this Act.

  • 2006, c. 12, s. 40

Marginal note:Due diligence available

  •  (1) Due diligence is a defence in a proceeding in relation to a violation.

  • Marginal note:Common law principles

    (2) Every rule and principle of the common law that renders any circumstance a justification or an excuse in relation to a charge for an offence applies in respect of a violation to the extent that it is not inconsistent with this Act.

  • 2006, c. 12, s. 40

Collection of Penalties

Marginal note:Debts to Her Majesty

  •  (1) A penalty and any interest due in respect of the penalty constitute a debt due to Her Majesty in right of Canada and may be recovered in the Federal Court.

  • Marginal note:Time limit

    (2) No proceedings to recover a debt referred to in subsection (1) may be commenced after the period of five years that begins on the day on which the debt became payable.

  • Marginal note:Proceeds payable to Receiver General

    (3) A penalty paid or recovered under this Part is payable to and shall be remitted to the Receiver General.

  • 2006, c. 12, s. 40

Marginal note:Certificate

  •  (1) The unpaid amount of any debt referred to in subsection 73.25(1) may be certified by the Director.

  • Marginal note:Registration in Federal Court

    (2) Registration in the Federal Court of a certificate made under subsection (1) has the same effect as a judgment of that Court for a debt of the amount specified in the certificate and all related registration costs.

  • 2006, c. 12, s. 40

Marginal note:Collecting penalties

  •  (1) The Centre may, for the purpose of collecting penalties proposed in a notice of violation issued under subsection 73.13(2) or imposed under this Part, enter into a contract, memorandum of understanding or other agreement with a department or an agency of the Government of Canada or the government of a province and with any other person or organization, inside Canada, in its own name or in the name of Her Majesty in right of Canada.

  • Marginal note:Disclosure of information

    (2) The Centre may disclose to the other party of the contract, memorandum or agreement any information required to collect the penalties.

  • Marginal note:Use of information

    (3) The other party shall not use the information referred to in subsection (2) for any purpose other than collecting the penalties.

  • 2006, c. 12, s. 40

Marginal note:Interest

 If a person or entity fails to remit a penalty payable under this Part to the Receiver General, the person or entity shall pay to the Receiver General interest on the amount of the penalty. The interest shall be calculated at the prescribed rate for the period beginning on the first day after the day on which the amount was required to be paid and ending on the day on which the amount is paid.

  • 2006, c. 12, s. 40
 
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