FINTRAC Issues Advisory on FATF High-Risk Jurisdictions for Canadian Reporting Entities

• The Financial Action Task Force (FATF) has identified several high-risk jurisdictions that pose significant threats to the international financial system.
• FINTRAC has issued an advisory to Canadian reporting entities, emphasizing the importance of accurately identifying and reporting suspicious transactions related to these countries.
• Reporting entities in Canada are required by law to report suspicious transactions related to high-risk jurisdictions to FINTRAC.

The FATF's call for action on high-risk jurisdictions is a critical component of its efforts to protect the international financial system from illicit activities.

The Financial Action Task Force (FATF) has identified several high-risk jurisdictions that pose significant threats to the international financial system. The FATF's statement on these countries is a call for action, urging reporting entities in Canada and other countries to take extra precautions when dealing with transactions related to these jurisdictions.

In response to the FATF's warning, FINTRAC has issued an advisory to Canadian reporting entities, emphasizing the importance of accurately identifying and reporting suspicious transactions. The advisory serves as a reminder that reporting entities must consider the FATF's list of high-risk jurisdictions when making decisions about sending suspicious transaction reports (STRs) to FINTRAC.

The Financial Action Task Force (FATF) is an intergovernmental organization that sets global standards for anti-money laundering and combating the financing of terrorism. The FATF's call for action on high-risk jurisdictions is a critical component of its efforts to protect the international financial system from illicit activities.

In Canada, reporting entities are required by law to report suspicious transactions related to high-risk jurisdictions to FINTRAC. This requirement is rooted in the Proceeds of Crime (Money Laundering) and Terrorist Financing Act, which sets out the rules for anti-money laundering and terrorist financing in Canada.

The FATF's warning about high-risk jurisdictions and FINTRAC's advisory are critical reminders of the importance of accurate reporting by Canadian reporting entities. By taking extra precautions when dealing with transactions related to these countries, reporting entities can help prevent money laundering and terrorist financing.

Lawyers and compliance officers should carefully review the FATF's list of high-risk jurisdictions and ensure that their reporting procedures are up-to-date and compliant with Canadian anti-money laundering regulations.

Lawyers and compliance officers should monitor this FINTRAC advisory to ensure they are accurately identifying and reporting suspicious transactions related to high-risk jurisdictions, as required by Canadian anti-money laundering regulations.

Source: Original reporting via November 28, 2022 – FINTRAC Advisory