Brokers Wanted: Help Test a New Pilot FINTRAC Compliance Tool
How to opt in and more.
Do you like avoiding FINTRAC-related administrative penalties (i.e., fines)?
REALTORS® must comply with their Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) obligations. To make things easier, CREA has developed a tool to help REALTORS® identify when to file a Suspicious Transaction Report (STR).
While no one wants to add steps to their workflow, adding this step is better than the alternative (pesky fines)—not to mention doing your part to keep Canada free of money laundering and terrorist activity financing.
Read on to learn more about the tool and how brokers can pilot this tool in their brokerages.
Jump Ahead
Why do we need this tool?
While you may be able to opt out of using this tool, there’s no opting out of your FINTRAC obligations.
This tool was developed not to replace FINTRAC obligations, but to support brokers and their sales representatives in having a standardized method to help identify when to file a STR.
In other words, this tool is to help ensure everyone at your brokerage is asking the right questions and getting the same feedback about when to act—taking some of the guess work out of the equation.
How does the tool work?
Not to brag, but its as easy as one, two, banana!
To use this tool, REALTORS® answer a series of questions about the transaction they're completing. Questions like:
- Does your client’s business or occupation seem inconsistent with the purchase or sale (e.g., if they're a buyer, can they afford it?, etc.)?
- Is a large amount of the deposit paid in cash?
- Is your client purchasing multiple properties within a short period?
Upon completion the tool will give a number. This number is associated with predicted risk.
If the number is an eight or higher, REALTORS® should consider filing a Suspicious Transaction Report.
Regardless of the score, REALTORS® must exercise judgement. Transactions with scores under an eight could trigger a need to report if any question within the assessment yields a positive indication of potential suspicious activity. Always evaluate the full context to decide if suspicions are warranted and a report is necessary.
Why implement this tool?
Brokers who participate during this pilot phase may be asked for feedback about their experience by CREA. By being a part of this early phase, you can help ensure the tool is effective for your own business and other brokers.
Additionally, if you choose to implement use of this tool with your sales representatives (and retain copies of this form with the brokerage’s transaction records), this may help demonstrate how you're meeting your FINTRAC obligations to determine if a transaction or attempted transaction is suspicious.
Other FINTRAC resources
- For information about the threshold that needs to be met in order to file a Suspicious Transaction Report and how to file one, visit Reporting suspicious transactions to FINTRAC.
- For information about how to file a Suspicious Transaction Report to FINTRAC electronically, visit Using the FINTRAC Web Reporting System.
- For additional considerations when dealing with transactions that are subject to a Ministerial directive, visit Ministerial directives and transaction restrictions.
Additionally, CREA’s Learning Hub offers a FINTRAC course for REALTORS®, Anti-Money Laundering (FINTRAC) Obligations for Brokers and Sales Representatives. Available in both official languages, this course provides essential guidance for REALTORS® to fulfil several obligations under Canada’s federal money laundering and anti-terrorist financing legislation, the Proceeds of Crime (Money Laundering) and Terrorism Financing Act (PCMLTFA) and regulations.
I’m sold! How do I access this tool?
Unlike CREA’s existing FINTRAC regime forms, which are available for download via CREA WEBForms® or on CREA’s Member Portal, the tool is available initially to brokers only upon request during the pilot testing phase.
Brokers interested in being part of this pilot should contact CREA’s Member Experience Centre (support@CREA.ca) to obtain a copy of the tool use it within their brokerage, and provide feedback to help shape future enhancements.
Sales representatives who are interested in being part of the pilot may wish to first speak to their broker before contacting CREA in order to ensure that they're following their brokerage’s Suspicious Transaction Report procedures.
The article above is for information purposes and is not legal advice or a substitute for legal counsel.
