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

Regulations are current to 2022-07-25 and last amended on 2022-06-29. Previous Versions

PART 2Requirement To Verify Identity (continued)

Life Insurance Companies and Life Insurance Brokers or Agents (continued)

 Section 92 does not apply to a life insurance company or a life insurance broker or agent when they are dealing in reinsurance.

Securities Dealers

 A securities dealer shall

  • (a) in accordance with section 105, verify the identity of a person for whom they open an account and every other person who is authorized to give instructions in respect of the account;

  • (b) in accordance with section 109, verify the identity of a corporation for which they open an account; and

  • (c) in accordance with section 112, verify the identity of an entity, other than a corporation, for which they open an account.

Money Services Businesses and Foreign Money Services Businesses

  •  (1) A money services business — or a foreign money services business in connection with services that they provide in Canada — shall, in accordance with section 105, verify the identity of a person who

    • (a) requests that they issue or redeem money orders, traveller’s cheques or similar negotiable instruments in an amount of $3,000 or more;

    • (a.1) requests that they transmit an amount of $1,000 or more in funds, other than in the case of an electronic funds transfer;

    • (b) requests that they initiate an electronic funds transfer of $1,000 or more;

    • (c) requests that they exchange an amount of $3,000 or more in a foreign currency exchange transaction;

    • (d) requests that they transfer an amount of $1,000 or more in virtual currency;

    • (e) requests that they exchange an amount of $1,000 or more in a virtual currency exchange transaction;

    • (e.1) is a beneficiary of an amount of $1,000 or more in funds, to whom they make the remittance, other than in the case of an electronic funds transfer;

    • (f) is a beneficiary of an international electronic funds transfer of $1,000 or more, or of a transfer of an amount of $1,000 or more in virtual currency, to whom they make the remittance;

    • (g) is a person in respect of whom they are required to keep an information record under paragraph 36.1(a); or

    • (h) donates an amount of $1,000 or more in funds or virtual currency using a crowdfunding platform that is provided and maintained by the money services business or foreign money services business.

  • (2) Paragraphs (1)(a) to (e) do not apply if an employee who is authorized to order transactions under an agreement referred to in section 37 conducts the transaction on behalf of their employer under the agreement.

  • (3) A money services business — or foreign money services business in connection with services that they provide in Canada — shall, in accordance with section 109, verify the identity of a corporation

    • (a) in respect of which they are required to keep an information record under paragraph 36.1(a);

    • (b) in respect of which they are required to keep an information record under section 37; or

    • (c) that donates an amount of $1,000 or more in funds or virtual currency using a crowdfunding platform that is provided and maintained by the money services business or foreign money services business.

  • (4) A money services business — or foreign money services business in connection with services that they provide in Canada — shall, in accordance with section 112, verify the identity of an entity, other than a corporation,

    • (a) in respect of which they are required to keep an information record under paragraph 36.1(a);

    • (b) in respect of which they are required to keep an information record under section 37; or

    • (c) that donates an amount of $1,000 or more in funds or virtual currency using a crowdfunding platform that is provided and maintained by the money services business or foreign money services business.

  • (5) Subsections (3) and (4) do not apply if the entity is

    • (a) a public body;

    • (b) a corporation or trust that has minimum net assets of $75 million on its last audited balance sheet, whose shares or units are traded on a Canadian stock exchange or a stock exchange designated under subsection 262(1) of the Income Tax Act and that operates in a country that is a member of the Financial Action Task Force; or

    • (c) a subsidiary of a public body referred to in paragraph (a) or a corporation or trust referred to in paragraph (b), whose financial statements are consolidated with the financial statements of the public body, corporation or trust.

British Columbia Notaries Public and British Columbia Notary Corporations

 A British Columbia notary public or British Columbia notary corporation shall

  • (a) in accordance with section 105, verify the identity of a person who conducts a transaction in respect of which they are required to keep a record under section 43;

  • (b) in accordance with section 109, verify the identity of a corporation that conducts a transaction referred to in paragraph (a) or on whose behalf a person conducts such a transaction; and

  • (c) in accordance with section 112, verify the identity of an entity, other than a corporation, that conducts a transaction referred to in paragraph (a) or on whose behalf a person conducts such a transaction.

Legal Counsel and Legal Firms

  •  (1) Subject to subsections (2) and 62(2) and section 63, every legal counsel and every legal firm shall, in respect of a transaction for which a record is required to be kept under section 33.4,

    • (a) in accordance with subsection 64(1), ascertain the identity of every person who conducts the transaction;

    • (b) in accordance with section 65, confirm the existence of and ascertain the name and address of every corporation on whose behalf the transaction is conducted and the names of the corporation’s directors; and

    • (c) in accordance with section 66, confirm the existence of every entity, other than a corporation, on whose behalf the transaction is conducted.

  • (2) Subsection (1) does not apply in respect of a transaction for which funds are received by a legal counsel or legal firm from the trust account of a legal firm or from the trust account of a legal counsel who is not acting on behalf of their employer.

 Any legal counsel or legal firm that is required to ascertain the identity of any person or confirm the existence of any entity in accordance with section 59.4 shall

  • (a) conduct ongoing monitoring of its business relationship with that person or entity; and

  • (b) keep a record of the measures taken and the information obtained under paragraph (a).

 If, as a result of its ongoing monitoring of a business relationship under paragraph 59.41(a), the legal counsel or legal firm considers that the risk of a money laundering offence or terrorist activity financing offence is high, it shall treat that person or entity as high risk for the purpose of subsection 9.6(3) of the Act and apply the prescribed special measures in accordance with section 71.1 of these Regulations.

Accountants and Accounting Firms

 An accountant or accounting firm shall

  • (a) in accordance with section 105, verify the identity of a person who conducts a transaction in respect of which they are required to keep a record under section 52;

  • (b) in accordance with section 109, verify the identity of a corporation that conducts a transaction referred to in paragraph (a) or on whose behalf a person conducts such a transaction; and

  • (c) in accordance with section 112, verify the identity of an entity, other than a corporation, that conducts a transaction referred to in paragraph (a) or on whose behalf a person conducts such a transaction.

Real Estate Brokers or Sales Representatives

  •  (1) A real estate broker or sales representative shall

    • (a) in accordance with section 105, verify the identity of a person who conducts a transaction in respect of which they are required to keep a record under subsection 58(1);

    • (b) in accordance with section 109, verify the identity of a corporation that conducts a transaction referred to in paragraph (a) or on whose behalf a person conducts such a transaction; and

    • (c) in accordance with section 112, verify the identity of an entity, other than a corporation, that conducts a transaction referred to in paragraph (a) or on whose behalf a person conducts such a transaction.

  • (2) If every party to a transaction is represented by a real estate broker or sales representative, each real estate broker or sales representative is required only to verify the identity of the party or parties that they represent.

  • (3) If one or more but not all of the parties to a transaction are represented by a real estate broker or sales representative, each real estate broker or sales representative shall take reasonable measures to verify the identity of the party or parties that are not represented.

  • (4) If a real estate broker or sales representative is unable to verify the identity of a party under subsection (3), they shall keep a record that sets out the measures taken, the date on which each measure was taken and the reasons why the measures were unsuccessful.

Real Estate Developers

 A real estate developer shall

  • (a) in accordance with section 105, verify the identity of a person who conducts a transaction in respect of which they are required to keep a record under section 64;

  • (b) in accordance with section 109, verify the identity of a corporation that conducts a transaction referred to in paragraph (a) or on whose behalf a person conducts such a transaction; and

  • (c) in accordance with section 112, verify the identity of an entity, other than a corporation, that conducts a transaction referred to in paragraph (a) or on whose behalf a person conducts such a transaction.

Casinos

 A casino shall

  • (a) in accordance with section 105, verify the identity of a person

    • (i) for whom the casino opens an account,

    • (ii) who is authorized to give instructions in respect of the account but who does not hold an account with the casino,

    • (iii) who receives a disbursement in respect of which the casino is required to make a report under section 71,

    • (iv) who conducts a transaction in respect of which the casino is required to keep a record under paragraph 74(2)(a) or (f),

    • (v) who requests that the casino exchange an amount of $3,000 or more in a foreign currency exchange transaction,

    • (vi) who requests that the casino initiate an electronic funds transfer in respect of which the casino is required to keep a record under paragraph 74(2)(c), or

    • (vii) who is the beneficiary of an international electronic funds transfer in respect of which the casino is required to keep a record under paragraph 74(2)(e);

  • (b) in accordance with section 109, verify the identity of a corporation for which the casino opens an account; and

  • (c) in accordance with section 112, verify the identity of an entity, other than a corporation, for which the casino opens an account.

Departments and Agents or Mandataries of Her Majesty in Right of Canada or of a Province That Issue, Sell or Redeem Money Orders

 A department or an agent of Her Majesty in right of Canada or an agent or mandatary of Her Majesty in right of a province shall

  • (a) in accordance with section 105, verify the identity of a person in respect of whom they are required to keep a record under subparagraph 82(a)(ii) or (b)(ii);

  • (b) in accordance with section 109, verify the identity of a corporation in respect of which they are required to keep an information record under subparagraph 82(a)(iii) or (b)(iii); and

  • (c) in accordance with section 112, verify the identity of an entity, other than a corporation, in respect of which they are required to keep an information record under subparagraph 82(a)(iii) or (b)(iii).

PART 3Measures for Verifying Identity

  •  (1) A person or entity that is required to verify a person’s identity shall do so

    • (a) by referring to an identification document that contains the person’s name and photograph and that is issued by the federal government or a provincial government or by a foreign government that is not a municipal government, and by confirming that the name and photograph are those of the person;

    • (b) by referring to information concerning the person that the person or entity that is verifying their identity receives, on request, from a federal or provincial government body — or an agent or mandatary of that body — that is authorized in Canada to verify the identity of persons, and by confirming that either the name and address or the name and date of birth included in the information are those of the person;

    • (c) by referring to information that is in the person’s credit file — if that file is located in Canada and has been in existence for at least three years and the information is derived from more than one source — and by confirming that the name, address and date of birth in the credit file are those of the person;

    • (d) by doing any two of the following:

      • (i) referring to information from a reliable source that includes the person’s name and address, and confirming that the name and address are those of the person,

      • (ii) referring to information from a reliable source that includes the person’s name and date of birth, and confirming that the name and date of birth are those of the person,

      • (iii) referring to information that includes the person’s name and confirms that they hold a deposit account, a prepaid payment product account or a credit card or other loan account with a financial entity, and confirming that information; or

    • (e) by confirming that one of the following entities previously verified the person’s identity in accordance with any of paragraphs (a) to (d) or previously ascertained the person’s identity in accordance with these Regulations, as they read at the time, and that the name, address and date of birth in the entity’s record are those of the person:

      • (i) an entity that is referred to in any of paragraphs 5(a) to (g) of the Act and that is affiliated with the entity that is verifying the person’s identity,

      • (ii) an entity that carries out activities outside Canada that are similar to the activities of a person or entity referred to in any of paragraphs 5(a) to (g) of the Act and that is affiliated with the entity that is verifying the person’s identity,

      • (iii) a financial entity that is subject to the Act and that is a member of the same financial services cooperative or credit union central as the entity that is verifying the person’s identity.

  • (2) The identity of a person who is under 12 years of age shall be verified for the purposes of subsection (1) by verifying the identity of one of their parents or their guardian or tutor.

  • (3) The identity of a person who is at least 12 years of age but not more than 15 years of age may be verified by referring under subparagraph (1)(d)(i) to information that includes the name and address of one of the person’s parents or their guardian or tutor, and by confirming that the address is that of the person.

  • (4) For the purposes of subparagraphs (1)(d)(i) to (iii), the information that is referred to must not be from, or derived from, the same source and neither the person whose identity is being verified nor the person or entity that is verifying their identity can be a source. If information in a credit file is referred to, the credit file must have been in existence for at least six months.

  • (5) A document that is used by a person or entity to verify identity under subsection (1) must be authentic, valid and current. Other information that is used for that purpose must be valid and current.

  • (6) In the case of a retail deposit account referred to in subsection 627.17(1) of the Bank Act, if a person or entity cannot verify a person’s identity in accordance with one of paragraphs (1)(a) to (e) of this section, they are deemed to comply with subsection (1) if the person who requests that the account be opened meets the conditions set out in subsections 627.17(1) and (3) of the Bank Act.

  • (7) The identity shall be verified

    • (a) in the cases referred to in section 84, subparagraphs 86(a)(iii) and 88(a)(iii), paragraphs 95(1)(a) to (f), 96(a), 97(1)(a), 100(a), 101(1)(a) and 102(a), subparagraphs 103(a)(iii) to (vii) and paragraph 104(a), at the time of the transaction;

    • (b) subject to paragraph (j), in the cases referred to in subparagraphs 86(a)(i) and (ii) and paragraph 94(a), before the first transaction, other than an initial deposit, is carried out on the account;

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

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

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

    • (f) in the case referred to in subparagraph 88(a)(ii), before the first transaction is carried out by the authorized user on the prepaid payment product account;

    • (g) in the cases referred to in paragraphs 89(a) and (d) and subparagraph 89(e)(i), within 15 days after the day on which the trust company becomes the trustee;

    • (h) subject to paragraph (j), in the case referred to in paragraph 92(a), within 30 days after the day on which the information record is created;

    • (h.1) in the case referred to in paragraph 95(1)(g), at the time the information record is created;

    • (h.2) in the case referred to in paragraph 95(1)(h), at the time of the donation;

    • (i) in the cases referred to in subparagraphs 103(a)(i) and (ii), before any funds are disbursed; and

    • (j) in the case of a group plan account, at the time a contribution in respect of a member of the group plan is made to the plan.

 
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