FINTRAC Compliance Requirements

As of October 11, 2024, Hosper Mortgage will be adapting to the new requirements set by FINTRAC (Financial Transactions and Reports Analysis Centre of Canada).

These changes are part of a broader initiative to strengthen Canada's anti-money laundering (AML) and anti-terrorist financing (ATF) measures.

As a mortgage lender, we will soon fall under the regulations of the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA). This means we will have new responsibilities to ensure that our operations meet FINTRAC’s standards for transparency and compliance. This includes:

1. Implementing a Compliance Program: We will develop and maintain an internal compliance program designed to meet FINTRAC’s requirements. This includes staff training, written policies, and internal controls to prevent money laundering and terrorist financing.

2. Reporting transactions: We will be required to report certain types of financial transactions, such as large cash transactions or suspicious activities, directly to FINTRAC.

3. Keeping comprehensive records: We’ll ensure that all transactions, records, and identification documents are meticulously maintained and organized for easy access in case of regulatory review.

4. Know Your Client (KYC): We will continue to strengthen our client onboarding processes by verifying the identity of each client, confirming the source of funds, and monitoring for any suspicious activities.

5. Applying ministerial directives: We will adhere to any directives or special measures issued by the government to counteract money laundering or terrorist financing risks.

FINTRAC will be authorized to conduct compliance examinations to ensure we are adhering to the new regulations. These assessments will review how we implement our compliance program, maintain records, identify clients, and report transactions. Being prepared for these reviews is crucial to avoiding penalties and ensuring our business operates smoothly.

Failure to comply with these regulations could result in significant penalties. FINTRAC has the authority to issue administrative monetary penalties to entities in the mortgage sector that do not meet the requirements of the PCMLTFA. We are taking proactive steps to avoid such penalties by ensuring full compliance from the start.

We are already reviewing the Mortgage Sector Self-Assessment Tool provided by FINTRAC to ensure we understand our obligations and can implement the necessary changes by the October 11, 2024, deadline. 

To find out more about FINTRAC’s requirements for the mortgage sector, visit the official FINTRAC page.