In June 2016, FINTRAC announced changes to the Proceeds of Crime (Money Laundering) and Terrorist Financing Act and regulations. CREA completed an extensive review of their FINTRAC support materials for members to reflect the changes.
In order to comply with your FINTRAC obligations, you must use these updated forms by June 17, 2017.
- Individual Identification Information Record
- Corporation/Entity Identification Information Record
- Identification Mandatary/Agent Agreement
- Receipt of Funds Record
- Risk Assessment Form
Where can I find them?
CREA’s updated materials can be found on REALTOR Link® here and on WEBForms® (updated in April 2017).
Here is a summary of the key changes reflected in the updated materials.
Individual Identification Information Record
Client Identification:
There are now three methods to identify clients. You only need to pick one of the following three methods:
| A.1: Federal/Provincial/Territorial Government-Issued Photo ID | A.2: Credit File
| A.3: Dual ID Process
Method
|
| Using a single piece of federal/provincial government-issued photo identification.
Note: SIN cards are not acceptable. Click here for a list of acceptable photo ID. | Verifying that the client’s name, date of birth and address match information obtained from a Canadian credit bureau that has been in existence for at least three years. | Using two original, valid and current documents or information from independent and reliable sources (such as utility bills or bank statements).
Note: Ensure your client provides the original statement and not a copy. Originals include statements received through snail mail or statements that have been downloaded. |
The Credit File and Dual Process methods may be used for non face-to-face identification.
Unrepresented Individuals:
You have an obligation to try to identify an individual even if you’re not representing them (e. g. a seller who has no representation). This has not changed, however, you now have an obligation to keep a record that you tried to identify them using section A.4 on the Individual Identification Information Record.
Verification of Third Parties:
On the Individual Identification Information Record, notice that there is a section B. Verification of Third Parties and underneath, B.1 Third Party Reasonable Measures and B.2 Third Party Record. You need to fill out this section to show that you tried to determine if there was a third party and if so, you tried to ID them.
Corporation/Entity Identification Information Record
What’s new:
- there is now a section for unrepresented individuals
- there is a section on third parties (whether there is or isn’t one)
- you need to identify an organization as well as the person you are dealing with (the representative of the organization)
Receipt of Funds Record
What’s new:
- some sections were moved around to more logical places and reworded
- new headings were added to organize similar topics
- B. Information on Funds now includes “Date of receipt of funds”
- new heading: C. Information on Individual/Entity Providing Funds (the obligation to identify the person providing the funds has not changed)
- you need to fill out section D. Additional Information if you received the funds in cash
- if the listing brokerage doesn’t provide information requested for a buyer’s agent, you need to document this
Risk Assessment Form
- nothing’s really changed
- Part 3 Brokerage Overall Risk Level (page 4): You need explain why you checked a certain level. FINTRAC wants to know that brokerages know who they are dealing with.
More information
- FINTRAC’s Risk-based approach workbook for the Real Estate sector: A guide to help brokers and REALTORS® identify risks in the real estate sector as well as ways to implement an effective risk mitigation strategy. Note: CREA’s Risk Assessment Form remains a valid resource for brokers and REALTORS® to assess and document the threats and vulnerabilities specific to their business.
- FINTRAC’s Operational Brief: Indicators of Money Laundering in Financial Transactions Related to Real Estate: A guide to help brokers and REALTORS® identify suspicious transactions. The Operational Brief includes clarification and guidance as well as a list of indicators, methods and techniques that could potentially be used to bring illicit funds into the Canadian financial system.
- Reminder: All suspicious transactions must be reported to FINTRAC by filling out an online Suspicious Transaction Report.