4 days ago
FINTRAC fines B.C. currency exchange nearly $350K for non-compliance with money laundering rules
Federal anti-money-laundering investigators have imposed a hefty fine on a currency exchange business based in Burnaby, B.C.
The Financial Transactions and Reports Analysis Centre of Canada, better known as FINTRAC, announced the $348,067.50 administrative monetary penalty against Crystal Currency Exchange Inc. on Thursday.
The penalty, which was imposed on March 5, stems from nine instances of non-compliance with Part 1 of the federal Proceeds of Crime (Money Laundering) and Terrorist Financing Act and its associated regulations, according to FINTRAC.
The currency exchange has launched an appeal of the penalties in Federal Court.
According to FINTRAC, Crystal Currency Exchange's violations included:
Failure to submit suspicious transaction reports where there were reasonable grounds to suspect that transactions were related to a money laundering or terrorist activity financing offence;
Failure to report large cash transactions of $10,000 or more in cash in a single transaction;
Failure to submit outgoing electronic funds transfer reports of $10,000 or more in the course of a single transaction, together with prescribed information;
Failure to submit incoming electronic funds transfer reports of $10,000 or more in the course of a single transaction, together with prescribed information;
Failure to appoint a compliance officer;
Failure to develop and apply written compliance policies and procedures that are kept up to date;
Failure to assess and document the risk of a money laundering or terrorist financing offence;
Failure to develop and maintain a training program; and
Failure to institute and document the prescribed review.
A more detailed summary of the non-compliance is listed on the FINTRAC website. It indicates that investigators found three instances of unreported suspicious transactions, each involving a client about whom Crystal Currency Exchange had previously submitted a suspicious transaction report.
The regulator's summary also notes that it had informed the business of 'deficiencies in its compliance program' during previous examinations in 2015 and 2017. Despite this, 'FINTRAC did not observe any improvement in Crystal Currency Exchange Inc.'s compliance program' when investigators returned in 2022.
'Canada's anti-money-laundering and anti-terrorist-financing regime is in place to protect the safety of Canadians and the security of Canada's economy,' said Sarah Paquet, FINTRAC's director and CEO, in the news release announcing the penalties.
'FINTRAC works with businesses to help them understand and comply with their obligations under the act. We are also firm in ensuring that businesses continue to do their part and we will take appropriate actions when they are needed.'
