Audit of the Financial Transactions and Reports Analysis Centre of Canada - page 7

AUDIT REPORT OF THE PRIVACY COMMISSIONER OF CANADA,
2013
5
Introduction
BACKGROUND
1. Money laundering is the process used to disguise
the origin of money or assets derived from
criminal activity. The
Proceeds of Crime (Money
Laundering) and Terrorist Financing Act
(PCMLTFA or the Act) was enacted in 2000. This
legislation established the Financial Transactions
and Reports Analysis Centre (FINTRAC) as
Canada’s financial intelligence unit.
2. Amendments to the PCMLTFA in 2006 increased
both the number of organizations subject to the
Act
and the types of transactions which are
analyzed and reported. The amendments also
enabled FINTRAC to disclose more information
to law enforcement and security organizations,
as well as to the Canada Border Services Agency
(CBSA) and the Canada Revenue Agency (CRA).
In February 2011, the
Jobs and Economic Growth
Act
amended the thresholds of designated
information that FINTRAC can disclose to
CRA and CBSA.
3. At the time of our audit, the PCMLTFA was
undergoing a five-year parliamentary review,
as required under section 72(1) of the Act.
4. The Act requires persons and entities, potentially
up to 300,000 in number, which fall into one of
ten sectors (see Appendix 1) to collect and
maintain specific information about their clients
and their transactions. These persons and entities
are also required to transmit reports containing
sensitive personal information to FINTRAC.
5. The Act also establishes a requirement to report
the cross border movement of currency or
monetary instruments with a value equal to or
greater than $10,000, or its equivalent in foreign
currency. Currency or monetary instruments that
are seized by CBSA, regardless of value, are also
reported to FINTRAC.
ABOUT THE AUDIT ENTITY
6. FINTRAC is an independent agency reporting to
the Minister of Finance and operating at arm’s
length from law enforcement and other entities
to which it is authorized to disclose information.
Created in 2001, FINTRAC’s mandate is to receive,
collect, analyze, assess and disclose information
on financial transactions, and to disseminate
intelligence in order to assist in the detection,
prevention and deterrence of money laundering
and terrorist financing activities. FINTRAC’s
legislative responsibilities under the PCMLTFA
include protecting the personal information
under its control.
7. FINTRAC is also required to analyze and disclose
information relevant to its mandate and it must
undertake a compliance program to ensure
reporting entities meet their obligations under
the PCMLTFA and regulations.
8. FINTRAC has approximately 352 employees.
As of June 30, 2012, FINTRAC had an annual
budget of $54.0 million. Further information
about FINTRAC is available on its website at
Introduction
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