Examination of a money laundering case brought to light by our analysis team. (Transcript)
In today's sophisticated world of blindingly fast technology, high-speed travel, and the globalization of economies, guess what industry is operating at the most
technologically advanced level in history?
Crime is driven by money and greed. The movement of money from criminal activity, its placement, layering, and integration, finances criminal activity of all kinds, allowing
it to grow and flourish. In fact, criminals involved in the laundering of money have developed a variety of ways to make "dirty" money appear to be legitimate.
In the case of terrorist financing, the money is moved before the crime takes place, but the transactions are equally clandestine.
Both activities create critical linking points for those involved in the fight against these forces.
It's called the money trail: and the careful analysis of the money trail can lead to the prosecution of terrorists and criminals.
The Financial Transactions and Reports Analysis Centre of Canada, or FINTRAC, is an independent financial intelligence unit whose mission is to fight money laundering and
terrorist activity financing.
Harnessing high-powered technology and analytical tools, and working in partnership with Canadians, FINTRAC provides Canadian and international agencies with reliable
financial intelligence - connecting the money to the crime.
Real Estate Agent
In my business, community safety and a good neighborhood are crucial to making sales.
That's why when I sense that there's something not right with the deal, I know that it's time to contact FINTRAC.
It's my way of doing whatever I can to maintain a high professional standard and also at the same time to fight crime and terrorism.
Here's how FINTRAC works.
We receive reports of financial transactions and other voluntary information...
Then we analyze this information, looking for and finding links and patterns, trends and tendencies...
And when we reach a threshold of reasonable grounds to suspect money laundering or terrorist financing, we disclose the identifying information to law enforcement and security
agencies in Canada and around the world, giving them the intelligence they need to investigate and prosecute.
First let's look at the more than 100,000 reporting entities that provide information to FINTRAC:
- From banks, credit unions, caisses populaires and trust and loan companies.
- From securities dealers, accountants, real estate agents and brokers, insurance agents and brokers, casinos and other sources;
- From Foreign exchange dealers and money services businesses;
- From government, law enforcement and intelligence agencies in Canada and abroad.
- And from a number of other sources, including the general public.
This information includes reports of suspicious transactions, international electronic funds transfers of $10,000 or more, large cash transactions of $10,000 or more, and
terrorist property reports.
It's a database of millions of transactions per year.
In the reporting of financial transactions here in Canada, the banks and other financial institutions have been on the forefront. We understand the important role we play
in this matter. The Canadian banks today have developed very sophisticated reporting programs. We take the detection and deterrence of money-laundering and terrorist financing
We provide FINTRAC with various financial reports in these efforts we hope to maintain the strength and integrity of the Canadian financial system.
Now let's look at how we analyze the financial information we get.
Our database is large and complex, as we work with millions of transactions and use them as the basis of our analysis.
In a highly secure environment, FINTRAC's team uses specially designed analytical tools to find patterns, which are then checked and cross-checked exhaustively.
It's funny: my first reaction was: well, we don't handle cash the way a bank teller or a casino cashier does...
And so when we first started to learn from FINTRAC about the placement, layering and integration of money through financial organizations we were, quite frankly, shocked.
Now we really examine transactions from a different perspective, those that make no business sense or depart significantly from the normal get a second look.
It's about applying common sense, and my colleagues and I find it kind of intriguing... we're helping to fight crime at a serious level, and it's basically an easy thing to
fulfill the compliance requirements.
Now let's examine disclosure - what we do with intelligence once it reaches the threshold of reasonable suspicion.
Most of the millions of reports we receive are the result of ordinary day-to-day business transactions. To protect the privacy rights of Canadians, these reports are carefully
safeguarded by FINTRAC. In fact, the vast majority of the transactional data in FINTRAC's possession is never shared with anyone.
Once our analysis shows that we have reasonable grounds to suspect that the information is relevant to an investigation or prosecution, FINTRAC transmits our analysis to the
appropriate law enforcement or security agency, enabling them to move ahead with an investigation.
Foreign Exchange Dealer
Crime and acts of terrorism have a very negative impact on travel and tourism - and the bulk of income for foreign exchange dealers is driven by those industries.
I'm a professional and I have high standards both personally and as a businesswoman. That's why I never want to think - "Hey, I just got duped into being part of something
shady... something illegal." So that's why this is really worth taking a look at.
The information I provide may be the most important link, or just one of hundreds that are treated with high confidentiality by FINTRAC. So I do my part - and I believe
Credit Union Representative
In every situation, with every client, even the ones you know well, you have to ask yourself: "Does this make sense?"
"Does this transaction stick out for me in relation to others by the same individual or organization?"
"Does this transaction have a pattern that can turn on a red light in my head?"
If so, it's time to act. Not just because you must... but because you should. It's as simple as that.
Your commitment to the process of combating money laundering and terrorist financing entails these key activities:
- Filing reports;
- Identifying clients;
- Keeping certain records;
- and establishing a compliance regime.
Your compliance regime should contain these four key elements:
- Appointment of a compliance officer;
- Establishment of compliance policies and procedures;
- A systematic, regular review of your compliance policies and procedures;
- And ongoing compliance training, in order to keep staff and colleagues up to date.
FINTRAC can provide you with some tools to help bring your compliance regime on line.
Here's how you can find out more about FINTRAC.
Financial Transactions and Reports Analysis Centre of Canada
234 Laurier Avenue West, 24th floor
Canada K1P 1H7