Presentations to Reporting Entities

Real Estate Presentation

September 2008

Table of Contents

View all slides


Slide 1: New PCMLTFA Obligations


Real Estate Brokers and Sales Representatives

September 2008


Slide 2: Presentation Overview


  • Introduction
  • Objectives of new requirements
  • Changes to reporting
  • Changes to client identification and record keeping
  • Changes to compliance regime
  • Administrative monetary penalty regime
  • Other information

Slide 3: Introduction


  • The PCMLTFA was amended in December 2006, authorizing the creation of new requirements through its related regulations:
    • Proceeds of Crime (Money Laundering) and Terrorist Financing Regulations
    • Proceeds of Crime (Money Laundering) and Terrorist Financing Suspicious Transaction Reporting Regulations
  • New requirements came into effect on June 23, 2008 and July 28, 2008

Slide 4


Objectives of New Requirements


Slide 5: Objectives of New PCMLTFA Requirements


  • Strengthen existing AML/ATF regime and build on FINTRAC's experience
  • Address existing gaps in the legislation and regulations
  • Enhanced detection and deterrence of money laundering and terrorist financing
  • Make illicit transactions more difficult to conduct
  • Greater impact against organized crime and terrorists

Slide 6: Why is the Real Estate Sector Covered?


  • Real estate is one of several business sectors that is at high risk for money laundering.
  • According to an independent study, real estate transactions are frequently cited in RCMP money laundering cases.
  • Real estate is a means used by criminals to obscure source of funds and hide ownership of assets (Financial Action Task Force).

Slide 7: Examples of Publications Citing Real Estate Money Laundering Risks


  • FINTRAC: Guideline 2: Suspicious Transactions, indicators for money laundering and terrorist financing March 2008
  • FATF: Money Laundering and Terrorist Financing Through the Real Estate Sector, typologies report May 2008
  • FinCEN (United States' Financial Intelligence Unit):
    • Suspected Money Laundering in the Residential Real Estate Industry May 2008
    • Suspected Money Laundering in the Commercial Real Estate Industry December 2006
  • Criminal Intelligence Service of Canada: Mortgage Fraud and Organized Crime in Canada September 2007
  • York University: Money Laundering in Canada: A Study of RCMP Cases March 2004

Slide 8


Highlights of Changes to the Proceeds of Crime (Money Laundering) and Terrorist Financing Act and Regulations


Slide 9: Definition of “Real Estate Broker or Sales Representative”


  • Regulations apply to licensed or registered real estate brokers or sales representatives when they act as an agent in respect of the purchase or sale of real estate
  • Regulations do not apply to transactions pertaining to leases, rentals and property management

Slide 10


Changes to Reporting