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Proceeds of Crime (Money Laundering) and Terrorist Financing Regulations (SOR/2002-184)

Regulations are current to 2021-11-17 and last amended on 2021-06-01. Previous Versions

PART 3Measures for Verifying Identity (continued)

  •  (1) A person or entity that is required to verify a person’s identity in accordance with subsection 105(1) may rely on an agent or mandatary to take the measures to do so.

  • (2) The person or entity may rely on measures that were previously taken by an agent or mandatary to verify the person’s identity if the agent or mandatary was, at the time they took the measures,

    • (a) acting in their own capacity, whether or not they were required to take the measures under these Regulations; or

    • (b) acting as an agent or mandatary under a written agreement or arrangement that was entered into, with another person or entity that is required to verify a person’s identity, for the purposes of verifying identity in accordance with subsection 105(1) or, if the measures were taken before the coming into force of this subsection, that was entered into, with another person or entity that was required to ascertain a person’s identity, for the purposes of ascertaining identity in accordance with these Regulations as they read at the time the measures were taken.

  • (3) In order to rely, under subsection (1) or (2), on measures taken by an agent or mandatary, the person or entity shall

    • (a) have entered into a written agreement or arrangement with the agent or mandatary for the purposes of verifying a person’s identity in accordance with subsection 105(1);

    • (b) as soon as feasible, obtain from the agent or mandatary the information that the agent or mandatary referred to in order to verify the person’s identity and the information that the agent or mandatary confirmed as being that of the person; and

    • (c) be satisfied that the information that the agent or mandatary confirmed as being that of the person is valid and current and that the agent or mandatary verified the person’s identity in the manner described in one of paragraphs 105(1)(a) to (d) or, if the measures were taken before the coming into force of this section, that the agent or mandatary ascertained the person’s identity in accordance with these Regulations, as they read at the time the measures were taken.

  •  (1) A person or entity that is required to verify a person’s identity in accordance with subsection 105(1) may rely on measures that were previously taken by another person or entity if

    • (a) the other person or entity is referred to in section 5 of the Act; or

    • (b) the other entity is affiliated with the entity that is required to verify the person’s identity or with another entity referred to in section 5 of the Act and carries out activities outside Canada that are similar to those of a person or entity that is referred to in any of paragraphs 5(a) to (g) of the Act.

  • (2) The person or entity that is required to verify a person’s identity shall not rely on measures that were previously taken by an entity referred to in paragraph (1)(b) unless they are satisfied, after taking into account the risk of money laundering or terrorist activity financing offences in the foreign state in which that entity carries out the activities, that

    • (a) the entity applies policies that establish requirements similar to those in sections 6, 6.1 and 9.6 of the Act; and

    • (b) the entity’s compliance with those policies is subject to the supervision of a competent authority under the legislation of that foreign state.

  • (3) In order to rely, under subsection (1), on measures taken by another person or entity, the person or entity that is required to verify a person’s identity shall

    • (a) as soon as feasible, obtain from the other person or entity the information that was confirmed as being that of the person and be satisfied that the information is valid and current and that the other person or entity verified the person’s identity in the manner described in one of paragraphs 105(1)(a) to (d) or, if the measures were taken before the coming into force of this section, that the other person or entity ascertained the person’s identity in accordance with these Regulations, as they read at the time the measures were taken; and

    • (b) have a written agreement or arrangement with the other person or entity that requires the other person or entity to provide them on request, as soon as feasible, with all of the information that the other person or entity referred to in order to verify the person’s identity.

 A person or entity that is required to verify a person’s identity under these Regulations shall keep a record that sets out the person’s name and the following information:

  • (a) if the person or entity verified the person’s identity in accordance with paragraph 105(1)(a), the date on which they did so, the type of document referred to, its number, the jurisdiction and country of issue of the document and, if applicable, its expiry date;

  • (b) if the person or entity verified the person’s identity in accordance with paragraph 105(1)(b), the date on which they did so, the source of the information, the type of information referred to and a number associated with the information;

  • (c) if the person or entity verified the person’s identity in accordance with paragraph 105(1)(c), the date on which they did so, the source of the information and the number of the person’s credit file;

  • (d) if the person or entity verified the person’s identity in accordance with paragraph 105(1)(d), the date on which they did so, the source of the information, the type of information referred to and the account number included in it or, if there is no account number included in it, a number associated with the information;

  • (e) if the entity verified the person’s identity in accordance with paragraph 105(1)(e), the date on which it did so, the name of the entity that had previously verified that person’s identity, the manner in which the person’s identity had previously been verified under one of paragraphs 105(1)(a) to (d) and the applicable information referred to in one of paragraphs (a) to (d) of this section that is associated with that manner of verifying identity;

  • (f) if the entity verified the person’s identity in accordance with paragraph 105(1)(e) and the other entity had previously ascertained the person’s identity before the coming into force of this section, the date on which the entity verified the person’s identity in accordance with paragraph 105(1)(e), the name of the other entity, the manner in which the other entity had previously ascertained the person’s identity in accordance with these Regulations, as they read at the time the other entity ascertained the person’s identity, and the applicable information referred to in the record-keeping provision that is related to that manner, as it read at that time;

  • (g) if, under subsection 105(6), the person or entity is deemed to have complied with subsection 105(1), the reasons why the person’s identity could not be verified in the manner set out in one of paragraphs 105(1)(a) to (e) and the date on which the conditions set out in subsection 4(1) or (2) of the Access to Basic Banking Services Regulations were met;

  • (h) if, in accordance with subsection 106(1) or (2), the person or entity relied on measures taken by an agent or mandatary, all of the information that they obtain under paragraph 106(3)(b); or

  • (i) if, in accordance with subsection 107(1), the person or entity relied on measures taken by another person or entity, all of the information that is provided to them under paragraph 107(3)(b).

  •  (1) A person or entity that is required to verify a corporation’s identity shall do so by referring to its certificate of incorporation, to a record that it is required to file annually under applicable provincial securities legislation or to the most recent version of any other record that confirms its existence as a corporation and contains its name and address and the names of its directors.

  • (2) A record that is used to verify identity under subsection (1) must be authentic, valid and current.

  • (3) The names of a corporation’s directors do not need to be confirmed if the corporation is a securities dealer.

  • (4) The corporation’s identity shall be verified

    • (a) in the cases referred to in section 84 and subparagraph 88(b)(ii), at the time of the transaction;

    • (b) in the case referred to in section 85, before the transaction or attempted transaction is reported under section 7 of the Act;

    • (c) in the cases referred to in paragraphs 86(b) and 103(b), before the first transaction, other than the initial deposit, is carried out on the account;

    • (d) in the case referred to in paragraph 87(b), before any credit card issued on the account is activated;

    • (e) in the case referred to in subparagraph 88(b)(i), before the prepaid payment product account is activated;

    • (f) in the cases referred to in paragraph 89(b) and subparagraph 89(e)(ii), within 15 days after the day on which the trust company becomes the trustee;

    • (g) in the cases referred to in paragraph 92(b), subsection 95(3) and paragraph 104(b), within 30 days after the day on which the information record is created;

    • (h) in the case referred to in paragraph 94(b), within 30 days after the day on which the account is opened; and

    • (i) in the cases referred to in paragraphs 96(b), 97(1)(b), 100(b), 101(1)(b) and 102(b), within 30 days after the day on which the transaction is conducted.

  • (5) If a person or entity that is required to verify a corporation’s identity does so by referring to an electronic version of a record that is contained in a database that is accessible to the public, they shall keep a record that sets out the corporation’s registration number, the type of record referred to and the source of the electronic version of the record. In any other case, they shall keep the record or a copy of it.

  •  (1) A person or entity that is required to verify a corporation’s identity in accordance with subsection 109(1) may rely on measures that were previously taken by another person or entity if

    • (a) the other person or entity is referred to in section 5 of the Act; or

    • (b) the other entity is affiliated with the one that is required to verify the corporation’s identity or with another entity referred to in section 5 of the Act and carries out activities outside Canada that are similar to those of a person or entity that is referred to in any of paragraphs 5(a) to (g) of the Act.

  • (2) The person or entity that is required to verify a corporation’s identity shall not rely on measures that were previously taken by an entity referred to in paragraph (1)(b) unless they are satisfied, after taking into account the risk of money laundering or terrorist activity financing offences in the foreign state in which that entity carries out the activities, that

    • (a) the entity applies policies that establish requirements similar to those in sections 6, 6.1 and 9.6 of the Act; and

    • (b) the entity’s compliance with those policies is subject to the supervision of a competent authority under the legislation of that foreign state.

  • (3) In order to rely, under subsection (1), on measures taken by another person or entity, the person or entity that is required to verify a corporation’s identity shall

    • (a) as soon as feasible, obtain from the other person or entity the information that was confirmed as being that of the corporation and be satisfied that the information is valid and current and that the other person or entity verified the corporation’s identity in the manner described in subsection 109(1) or, if the measures were taken before the coming into force of this section, that the other person or entity confirmed the corporation’s existence and ascertained its name and address and the names of its directors in accordance with these Regulations, as they read at the time the measures were taken; and

    • (b) have a written agreement or arrangement with the other person or entity that requires the other person or entity to provide them on request, as soon as feasible, with all of the information that the other person or entity referred to in order to verify the corporation’s identity.

  •  (1) If a person or entity that is referred to in any of paragraphs 5(a) to (g) of the Act and that is required to verify a corporation’s identity in accordance with subsection 109(1) considers, based on an assessment of the risk referred to in subsection 9.6(2) of the Act, that there is a low risk of a money laundering offence or terrorist activity financing offence, they are deemed to comply with subsection 109(1) if

    • (a) the corporation whose identity is to be verified

      • (i) is an entity that is referred to in any of those paragraphs 5(a) to (g),

      • (ii) is a foreign corporation that carries out activities that are similar to those of an entity that is referred to in any of those paragraphs,

      • (iii) administers a pension or investment fund that is regulated under the legislation of a foreign state and that either is created by a foreign government or is subject to the supervision of a competent authority under the legislation of that foreign state,

      • (iv) is one whose shares are traded on a Canadian stock exchange or a stock exchange designated under subsection 262(1) of the Income Tax Act,

      • (v) is a subsidiary of a corporation that is referred to in any of subparagraphs (i) to (iv) or of an entity that is referred to in any of subparagraphs 114(1)(a)(i) to (iv) and is one whose financial statements are consolidated with the financial statements of that corporation or entity,

      • (vi) is an institution or agency of, or is owned by, the government of a foreign state, or

      • (vii) is a public service body, as defined in subsection 123(1) of the Excise Tax Act;

    • (b) within the applicable time referred to in one of paragraphs 109(5)(a) to (i), they are satisfied that the corporation exists and that every person who deals with them on behalf of the corporation is authorized by it to do so; and

    • (c) they keep a record that sets out the grounds for considering that there is a low risk of a money laundering offence or terrorist activity financing offence and the information obtained about the corporation and the persons referred to in paragraph (b).

  • (2) If the person or entity subsequently considers, based on an assessment of the risk referred to in subsection 9.6(2) of the Act, that the risk of a money laundering offence or terrorist activity financing offence has increased and is no longer low, they shall verify the corporation’s identity in accordance with subsection 109(1) as soon as feasible.

  •  (1) A person or entity that is required to verify the identity of an entity other than a corporation shall do so by referring to a partnership agreement, to articles of association or to the most recent version of any other record that confirms its existence and contains its name and address.

  • (2) A record that is used to verify identity under subsection (1) must be authentic, valid and current.

  • (3) The entity’s identity shall be verified

    • (a) in the cases referred to in section 84 and subparagraph 88(c)(ii), at the time of the transaction;

    • (b) in the case referred to in section 85, before the transaction or attempted transaction is reported under section 7 of the Act;

    • (c) in the cases referred to in paragraphs 86(c) and 103(c), before the first transaction, other than the initial deposit, is carried out on the account;

    • (d) in the case referred to in paragraph 87(c), before any credit card issued on the account is activated;

    • (e) in the case referred to in subparagraph 88(c)(i), before the prepaid payment product account is activated;

    • (f) in the cases referred to in paragraph 89(c) and subparagraph 89(e)(ii), within 15 days after the day on which the trust company becomes the trustee;

    • (g) in the cases referred to in paragraph 92(c), subsection 95(4) and paragraph 104(c), within 30 days after the day on which the information record is created;

    • (h) in the case referred to in paragraph 94(c), within 30 days after the day on which the account is opened; and

    • (i) in the cases referred to in paragraphs 96(c), 97(1)(c), 100(c), 101(1)(c) and 102(c), within 30 days after the day on which the transaction is conducted.

  • (4) If the person or entity that is required to verify an entity’s identity does so by referring to an electronic version of a record that is contained in a database that is accessible to the public, they shall keep a record that sets out the entity’s registration number, the type of record referred to and the source of the electronic version of the record. In any other case, they shall keep the record or a copy of it.

 
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