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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 5General Provisions (continued)

Third-Party Determination (continued)

  •  (1) A person or entity that is required to keep an information record under these Regulations — other than one in connection with a life insurance policy referred to in paragraph 22(1)(b) — shall, when they create the information record, take reasonable measures to determine whether the person or entity to which it pertains is acting on behalf of a third party.

  • (2) If the person or entity determines that the person or entity to which the information record pertains is acting on behalf of a third party, the person or entity shall take reasonable measures to obtain the following information and shall keep a record of the information obtained:

    • (a) if the third party is a person, their name, address, telephone number and date of birth and the nature of their principal business or their occupation;

    • (b) if the third party is an entity, its name, address and telephone number, the nature of its principal business, its registration or incorporation number and the jurisdiction and country of issue of that number; and

    • (c) the relationship between the third party and the person or entity to which the information record pertains.

  • (3) If the person or entity is not able to determine whether the person or entity to which the information record pertains is acting on behalf of a third party but there are reasonable grounds to suspect that they are, the person or entity shall keep a record that

    • (a) indicates whether, according to the person or entity to which the information record pertains, they are acting on their own behalf only; and

    • (b) describes the reasonable grounds to suspect that the person or entity to which the information record pertains is acting on behalf of a third party.

  •  (1) A casino that is required to report a disbursement under section 71 shall, when the casino makes the disbursement, take reasonable measures to determine whether the person or entity that requests that the disbursement be made is acting on behalf of a third party.

  • (2) If the casino determines that the person or entity that makes the request is acting on behalf of a third party, the casino shall take reasonable measures to obtain the following information and shall keep a record of the information obtained:

    • (a) if the third party is a person, their name, address, telephone number and date of birth and the nature of their principal business or their occupation;

    • (b) if the third party is an entity, its name, address and telephone number, the nature of its principal business, its registration or incorporation number and the jurisdiction and country of issue of that number; and

    • (c) the relationship between the third party and the person or entity that makes the request.

  • (3) If the casino is not able to determine whether the person or entity that makes the request is acting on behalf of a third party but there are reasonable grounds to suspect that they are, the casino shall keep a record that

    • (a) indicates whether, according to the person or entity that makes the request, they are acting on their own behalf only; and

    • (b) describes the reasonable grounds to suspect that the person or entity that makes the request is acting on behalf of a third party.

Information with Respect to Directors of a Corporation or Other Entity, Persons Who Own or Control 25% or More of a Corporation or Other Entity and Beneficiaries and Settlors of a Trust

[
  • SOR/2019-240, ss. 26, 27
]
  •  (1) Every person or entity that is required to verify an entity’s identity in accordance with these Regulations shall, at the time the entity’s identity is verified, obtain the following information:

    • (a) in the case of a corporation, the names of all directors of the corporation and the names and addresses of all persons who own or control, directly or indirectly, 25% or more of the shares of the corporation;

    • (a.1) in the case of a widely held or publicly traded trust, the names of all trustees of the trust and the names and addresses of all persons who own or control, directly or indirectly, 25% or more of the units of the trust;

    • (b) in the case of a trust, the names and addresses of all trustees and all known beneficiaries and settlors of the trust;

    • (c) in the case of an entity other than a corporation or trust, the names and addresses of all persons who own or control, directly or indirectly, 25% or more of the entity; and

    • (d) in all cases, information establishing the ownership, control and structure of the entity.

  • (2) Every person and entity that is subject to subsection (1) shall take reasonable measures to confirm the accuracy of the information when it is first obtained under that subsection and in the course of ongoing monitoring of business relationships.

  • (3) The person or entity shall keep a record that sets out the information and the measures taken to confirm the accuracy of the information.

  • (4) If the person or entity is not able to obtain the information, to keep it up to date in the course of ongoing monitoring of business relationships or to confirm its accuracy, the person or entity shall take

    • (a) reasonable measures to verify the identity of the entity’s chief executive officer or the person who performs that function; and

    • (b) the special measures referred to in section 157.

  • (5) If the entity whose identity is being verified under subsection (1) is a not-for-profit organization, the person or entity shall determine and keep a record that sets out whether that entity is

    • (a) a charity registered with the Canada Revenue Agency under the Income Tax Act; or

    • (b) an organization, other than one referred to in paragraph (a), that solicits charitable donations from the public.

  • (6) This section does not apply in respect of a group plan account held within a dividend reinvestment plan or a distribution reinvestment plan, including a plan that permits purchases of additional shares or units by the member with contributions other than the dividends or distributions paid by the sponsor of the plan, if the sponsor of the plan is an entity whose shares or units are traded on a Canadian stock exchange, and that operates in a country that is a member of the Financial Action Task Force.

 A trust company that is required to keep a record in respect of an inter vivos trust under these Regulations shall keep a record that sets out the name, address and telephone number of each beneficiary that is known when the trust company becomes a trustee for the inter vivos trust and

  • (a) if the beneficiary is a person, their date of birth and the nature of their principal business or their occupation; and

  • (b) if the beneficiary is an entity, the nature of its principal business.

Deemed Receipt of Funds and Virtual Currency

  •  (1) For the purposes of paragraph 7(1)(a), section 18 or 25 or paragraph 30(1)(a) or 70(1)(a), if the person or entity that has the obligation to report authorizes another person or entity to receive funds on their behalf, and that other person or entity receives an amount of $10,000 or more in cash in a single transaction in accordance with the authorization, the person or entity that has the obligation to report is deemed to have received the amount when it is received by the other person or entity.

  • (2) For the purposes of paragraph 33(1)(a), if the foreign money services business authorizes another person or entity to receive funds on their behalf from a person or entity in Canada, and that other person or entity receives an amount of $10,000 or more in cash in a single transaction in accordance with the authorization, the foreign money services business is deemed to have received the amount when it is received by the other person or entity.

  • (3) For the purposes of section 39, 48, 54, 60, 66 or 78, if the person or entity that has the obligation to report authorizes another person or entity to receive funds on their behalf in connection with the activity referred to in that section, and that other person or entity receives an amount of $10,000 or more in cash in a single transaction in accordance with the authorization, the person or entity that has the obligation to report is deemed to have received the amount when it is received by the other person or entity.

  •  (1) For the purposes of paragraph 7(1)(d), section 19 or 26 or paragraph 30(1)(f) or 70(1)(d), if the person or entity that has the obligation to report authorizes another person or entity to receive virtual currency on their behalf, and that other person or entity receives an amount of $10,000 or more in virtual currency in a single transaction in accordance with the authorization, the person or entity that has the obligation to report is deemed to have received the amount when it is received by the other person or entity.

  • (2) For the purposes of paragraph 33(1)(f), if the foreign money services business authorizes another person or entity to receive virtual currency on their behalf from a person or entity in Canada, and that other person or entity receives an amount of $10,000 or more in virtual currency in a single transaction in accordance with the authorization, the foreign money services business is deemed to have received the amount when it is received by the other person or entity.

  • (3) For the purposes of section 40, 49, 55, 61, 67 or 79, if the person or entity that has the obligation to report authorizes another person or entity to receive virtual currency on their behalf in connection with the activity referred to in that section, and that other person or entity receives an amount of $10,000 or more in virtual currency in a single transaction in accordance with the authorization, the person or entity that has the obligation to report is deemed to have received the amount when it is received by the other person or entity.

  •  (1) For the purposes of section 10, 20, 27 or 31 or subsection 72(1), if the person or entity that has the obligation to keep a large cash transaction record authorizes another person or entity to receive funds on their behalf, and that other person or entity receives an amount of $10,000 or more in cash in a single transaction in accordance with the authorization, the person or entity that has the obligation to keep the large cash transaction record is deemed to have received the amount when it is received by the other person or entity.

  • (2) For the purposes of section 34, if the foreign money services business authorizes another person or entity to receive funds on their behalf from a person or entity in Canada, and that other person or entity receives an amount of $10,000 or more in cash in a single transaction in accordance with the authorization, the foreign money services business is deemed to have received the amount when it is received by the other person or entity.

  • (3) For the purposes of section 41, 50, 56, 62, 68 or 80, if the person or entity that has the obligation to keep a large cash transaction record authorizes another person or entity to receive funds on their behalf in connection with the activity referred to in that section, and that other person or entity receives an amount of $10,000 or more in cash in a single transaction in accordance with the authorization, the person or entity that has the obligation to keep the large cash transaction record is deemed to have received the amount when it is received by the other person or entity.

  •  (1) For the purposes of section 11, 21, 28, 32 or 73, if the person or entity that has the obligation to keep a large virtual currency transaction record authorizes another person or entity to receive virtual currency on their behalf, and that other person or entity receives an amount of $10,000 or more in virtual currency in a single transaction in accordance with the authorization, the person or entity that has the obligation to keep the large virtual currency transaction record is deemed to have received the amount when it is received by the other person or entity.

  • (2) For the purposes of section 35, if the foreign money services business authorizes another person or entity to receive virtual currency on their behalf from a person or entity in Canada, and that other person or entity receives an amount of $10,000 or more in virtual currency in a single transaction in accordance with the authorization, the foreign money services business is deemed to have received the amount when it is received by the other person or entity.

  • (3) For the purposes of section 42, 51, 57, 63, 69 or 81, if the person or entity that has the obligation to keep a large virtual currency transaction record authorizes another person or entity to receive virtual currency on their behalf in connection with the activity referred to in that section, and that other person or entity receives an amount of $10,000 or more in virtual currency in a single transaction in accordance with the authorization, the person or entity that has the obligation to keep the large virtual currency transaction record is deemed to have received the amount when it is received by the other person or entity.

Record-keeping

 A person or entity that sends a report to the Centre shall keep a copy of the report.

 Every person and entity that enters into a business relationship shall keep a record that sets out the purpose and intended nature of the business relationship.

  •  (1) A person or entity that is required to verify the identity of another person or entity shall keep a record of the measures taken when they conduct ongoing monitoring of their business relationship with that person or entity and of the information obtained from that ongoing monitoring.

  • (2) Subsection (1) does not apply

    • (a) to a financial entity in respect of a group plan account held within a dividend reinvestment plan or a distribution reinvestment plan, including a plan that permits purchases of additional shares or units by the member with contributions other than the dividends or distributions paid by the sponsor of the plan, if the sponsor of the plan is an entity whose shares or units are traded on a Canadian stock exchange and that operates in a country that is a member of the Financial Action Task Force; or

    • (b) to a life insurance company or a life insurance broker or agent when they are dealing in reinsurance.

 If a record is required to be kept under these Regulations, the record or a copy of it may be kept in a machine-readable or electronic form if a paper copy can readily be produced from it.

  •  (1) A person or entity that is required to keep records under these Regulations shall keep those records for a period of at least five years after

    • (a) the day on which the account to which they relate is closed, in the case of signature cards, account operating agreements, account applications, credit card applications, records setting out the intended use of the account and records that are required to be kept under paragraph 12(k) or subsection 123(1);

    • (b) the day on which the last business transaction is conducted, in the case of information records, certificates of incorporation, records that are required to be filed annually under applicable provincial securities legislation and similar records that prove a corporation’s existence, partnership agreements, articles of association and similar records that prove the existence of an entity other than a corporation, records that are required to be kept under any of subsections 16(2), 123(2) and (3) and 138(3) and (5) and lists and records, other than information records, that are required to be kept under section 37; and

    • (c) the day on which they were created, in the case of all other records.

  • (2) For greater certainty, if a record that is kept under these Regulations is the property of a person’s employer or of a person or entity with which the person is in a contractual relationship, the person is not required to keep the record after the end of their employment or the contractual relationship.

 
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