Audit of the Financial Transactions and Reports Analysis Centre of Canada - page 10

19. Cross border movements of currency or monetary
instruments worth $10,000 or more are also
reported to FINTRAC by the Canada Border
Services Agency (CBSA).
20. Information concerning suspicions of money
laundering and terrorist financing activities is
also provided on a voluntary basis by members
of the public. As well, FINTRAC receives informa-
tion from law enforcement and security agencies
as part of their own investigations.
21. In our 2009 audit we found that FINTRAC received
and retained personal information that it had no
legislative authority to receive and that it did not
need or use. This information included:
• Reports that did not meet the $10,000 reporting
threshold and therefore should not have
been reported;
• Suspicious Transaction Reports (STRs) that
did not demonstrate “reasonable grounds to
suspect” money laundering or terrorist financing;
• Voluntary Information Records (VIRs) where
no grounds for suspicion of money laundering
or terrorist financing were evident; and,
• Extraneous personal information, such as
Social Insurance Numbers (SIN), health card
numbers and medical information that should
not have been reported.
22. Our 2009 audit also found that with the exception
of VIRs, FINTRAC’s screening processes were
designed primarily to address issues of data
quality—whether all required fields in reports
were completed—and did not address whether
the information was relevant to FINTRAC’s
mandate or whether the information was
excessive in nature.
23. We recommended that FINTRAC take steps to
limit the acquisition of personal information to
that which is authorized under the PCMLTFA and
that it needs or uses. In responding, FINTRAC
agreed to the recommendation and advised that
through its new reporting system it would
improve ways to validate reports as they are
transmitted to it and further reduce the potential
of receiving information that should not have
been sent. It also stated that it had built-in
enhanced front-end screening in the new Casino
Disbursement Report form which should further
assist in preventing this type of information from
entering FINTRAC’s database and that it regularly
reviewed and updated the guidance offered to
reporting entities. FINTRAC indicated that it felt
that this plus the other steps already taken would
be effective in reducing the amount of informa-
tion which it acknowledged is incorrectly sent
to it. FINTRAC committed to undertake a review
of its reporting forms to evaluate the analytical
value of data elements being captured and
minimize the reporting burden to reporting
entities. To assess progress, we interviewed
FINTRAC officials and reviewed a purposive
random sample of reports and VIRs received
by FINTRAC, as well as internal reports and
operational plans.
24. Ninety-eight percent of the reports FINTRAC
receives are comprised of Large Cash Transaction
Reports (LCTR) and international Electronic
Funds Transfer Reports (EFTR). We selected a
purposive sample of LCTRs and EFTRs drawn
through statistical random selection to verify
that the reports met the $10,000 threshold (either,
as a single transaction or two or more transac-
tions that are less than $10,000 but collectively
total $10,000 or more within a 24-hour period by
or on behalf of the same individual or entity). We
identified a number of reports that did not meet
the threshold and asked FINTRAC to provide the
corresponding reports that would collectively
meet or exceed $10,000. In responding, FINTRAC
indicated that the situation had not changed since
our 2009 audit, i.e. it still does not have the
technological capacity to match reports electroni-
cally. FINTRAC further stated that the process of
matching the reports we identified would have to
be conducted manually and such a review would
be resource intensive and time consuming.
Accordingly, the extent to which FINTRAC’s
information holdings are populated with reports
that do not meet the $10,000 reporting threshold
remains unknown.
1,2,3,4,5,6,7,8,9 11,12,13,14,15,16,17,18,19,20,...42
Powered by FlippingBook