How Tariff Uncertainty Impacts FINTRAC Compliance
It seems that not a day goes by without some major announcement regarding the current trade war between Canada and its neighbour to the south. As many commentators have noted, this will have serious and longstanding repercussions on Canadians.
Less obvious is the impact the trade war will have on Canada’s anti-money laundering laws and regulations.
REALTORS® may be interested to hear that on February 4, 2025, then Prime Minister Justin Trudeau announced a Directive on Transnational Crime and Border Security, which acknowledged the significant threats that the international and domestic drug trade, including fentanyl, pose to the livelihoods and safety of Canadians. The directive went on to acknowledge the importance of the United States as Canada’s most essential partner in reducing and disrupting the threats posed by transnational criminal activity and drug trafficking.
Sound familiar?
As you are likely aware, fentanyl is a commonly cited reason for the imposition of U.S. tariffs on Canadian goods. The directive suggests the federal government has heard that message loud and clear. This is further supported by the fact that, on March 7, 2025, the government announced the acceleration of significant regulatory amendments to Canada’s Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) regime. In that announcement, and accompanying regulatory impact assessment, a straight line was drawn between fentanyl and FINTRAC.
Fortunately for REALTORS®, the announcement did not speed up changes to the law impacting REALTORS®.
While relatively modest changes impacting REALTORS® are set to come into force on October 1, 2025, (relating to a new beneficial ownership discrepancy reporting obligation) FINTRAC still has several months to update its guidance. That said, it looks like more significant changes in the form of Bill C-2 are on the horizon.
CREA, of course, will update its materials to reflect any changes in the law or guidance, once available.
In any case, now’s not the time for complacency. By issuing the directive and accelerating changes to the law, the federal government has clearly communicated that FINTRAC compliance is an important mechanism that Canada will use to help convince our U.S. partners that Canada takes money laundering and drug trafficking seriously.
The ongoing trade war is unprecedented in its size and scope and may leave individual REALTORS® asking themselves what they can do to help Canada. While it may not seem like much, REALTORS® can play a small but important role by ensuring they have effective FINTRAC compliance programs in place and by fulfilling their day-to-day obligations such as ID’ing, record keeping, and reporting, to the best of their ability.
Every step counts.
