If you are a money services business (MSB), you need to know about all the obligations that apply to you. This includes registering your business with us, reporting to us, keeping records, identifying your clients, and having a compliance regime. To begin the MSB registration process, please complete and submit the Pre-registration form.
Who is a money services business (MSB)?
You are an MSB if you are in business in Canada to offer any of the following services to the public:
Foreign exchange dealing
- Conducting transactions where you exchange one type of currency (USD$ for CAD$) for another.
See examples where purchases made with foreign currency are not considered a foreign exchange.
- Diana pays for gas and a chocolate bar using a $100 US bill. She asks that her change be given to her in Canadian dollars. This would not be considered a foreign currency exchange transaction.
- Esther pays for a $20 book using a $50 US bill and a $50 US traveller's cheque. She asks that her change be given to her in Canadian dollars. The change given for one of the $50 is not considered foreign currency exchange. However, the amount given for the other $50 would be considered a foreign currency exchange.
- Transferring funds from one individual or organization to another using an electronic funds transfer network or any other method such as hawala, hundi, fei ch'ien, and chit.
Cashing or selling money orders, traveller's cheques or anything similar
- This may also include cashing or selling traveller's cheque or anything similar. This does not include cashing cheques made out to a particular individual or organization.
Who is not a money services business (MSB)?
You are not an MSB if you offer one or more MSB services:
- strictly as an agent for an MSB. It is the MSB for which you are an agent that has to register with us.
- as part of other activities for which you are a reporting entity.
See examples of who is not an MSB.
- Darren transfers funds as an agent of Money Transfer Inc. He also uses Money Transfer Inc.'s sign to advertise. Although Darren offers and advertises this service, he is not an MSB. It is Money Transfer Inc. that is the MSB.
- A securities dealer from ABC Investment Advisors Inc. receives funds from his client in Euros to buy Canadian securities. Although one type of money is exchanged for another, this would not be considered an MSB service because the securities dealer's activities are already covered under his obligations as a reporting entity.
Your money services business in Canada: What you need to know
If you do not meet all of these obligations, you may be assessed penalties or incur other consequences.
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