Record keeping requirements for dealers in precious metals and stones

June 2017 

June 2017

This guidance on record keeping is applicable to dealers in precious metals and stones that are subject to the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA) and associated Regulations.

In order to comply with your record keeping requirements, you are required to keep records in a manner in which they can be provided to FINTRAC within 30 days upon request. These records may also be requested through a judicial order by law enforcement, to support an investigation of money laundering or terrorist activity financing. A record (or a copy) may be kept in a machine-readable or electronic form, so long as a paper copy can easily be produced.

Employees who keep records for you are not required to keep them after the end of their employment with you. The same is true for individuals in a contractual relationship with you, after the end of that contractual relationship. This means that you have to obtain and keep the records that were kept for you by any employee or contractor before the end of that individual's employment or contract with you.

There may be situations where you are required to keep records for purposes other than your requirements under the PCMLTFA. For example, a federal or provincial regulator for your sector may require you to keep records in addition to those described in this guidance. If this is the case, you must still meet the requirements described in this guidance. For example, the retention period for your records can be longer than what is described, but it cannot be shorter.

Please note that as a dealer in precious metals and stones, you have record keeping requirements in addition to those described in this guidance. These additional requirements are detailed in the following Know your client guidance documents:

As a dealer in precious metals and stones you must keep the following records:

  1. Suspicious transaction report records
  2. Large cash transaction records
  3. Reasonable measures records

**Note: Exceptions to your record keeping requirements are listed in the last section of this guidance.

**Note: When recording the nature of the principal business or occupation of a client, you must be as descriptive as possible in order to be able to determine whether a transaction or activity is consistent with what would be expected for that client. For example, in the case of a person who is a manager, the occupation recorded should reflect the area of management such as “hotel reservations manager” or “retail clothing store manager.” The same is true when recording the nature of the principal business of an entity. For example, in the case of an entity in the field of sales, the nature of the principal business should specify the type of sales, such as “pharmaceutical sales” or “retail sales”.

1. Suspicious transaction report records

If you submit a suspicious transaction report (STR) to FINTRAC, you must keep a copy of it. This includes STRs for completed and attempted transactions.

Retention: You must keep a copy of an STR for at least five years from the date the report was submitted.

2. Large cash transaction records

You must keep a record of every large cash transaction. A large cash transaction occurs when you receive $10,000 or more in cash from a client in a single transaction. A large cash transaction also occurs when there are multiple cash transactions of less than $10,000 each that total $10,000 or more within a 24-hour period, when you know they are conducted by, or on behalf of, the same individual or entity.

When your client conducts a large cash transaction, your record must indicate the receipt of an amount of $10,000 or more in cash, along with the following:

  • the name, date of birth and address of the individual from whom you received the cash, and the nature of their principal business or occupation;
  • the amount and currency of the cash received;
  • the date of the transaction;
  • the purpose and details of the transaction, including:
    • the type of transaction (for example, the cash was used to purchase jewellery, precious metals, precious stones etc.); and
    • whether any other individuals or entities were involved in the transaction;
  • how the cash was received (for example, in person, by mail, by armoured car, or any other way);
  • if an account was affected by the transaction, include:
    • the account number and type of account; and
    • the full name of the account holder;
  • the currency in which the account's transactions are conducted; and
  • where cash is received for the sale of precious metals, precious stones or jewellery, you must also record:                        
    • the type of precious metals, precious stones or jewellery involved in the transaction;
    • the value of the transaction, if different from the amount of the cash received; and
    • the wholesale value of the transaction (that is, the amount you had paid for the item sold).

Retention: You must keep large cash transaction records for at least five years from the date they are created.

3. Reasonable measures records

The term “reasonable measures” refers to activities you are expected to undertake in order to meet certain obligations. The Regulations explicitly state when you must take reasonable measures to meet an obligation.

As of June 17, 2017, the Proceeds of Crime (Money Laundering) and Terrorist Financing Regulations have been changed to require that a record be kept when reasonable measures were taken, but were unsuccessful. A reasonable measure is unsuccessful when you do not obtain a response, such as a yes or no, and you are unable to make a conclusive determination. Refer to section 67.3 of the Regulations for every activity where you are required to keep records when reasonable measures were unsuccessful

When reasonable measures are unsuccessful, you must record the following information:

  • the measures taken;
  • the date on which each measure was taken; and
  • the reasons why the measures were unsuccessful.

You must outline the reasonable measures that you take in your compliance policies and procedures. This can form part of your unsuccessful reasonable measures record, or you could document, on a case-by-case basis, the measure taken in each record for unsuccessful reasonable measures.

For example, if a client is purchasing gold with more than $10,000 in cash, and you ask if they are acting on behalf of a third party and they refuse to answer the question – your record should indicate that you asked, the date you asked and the fact that the client refused to answer yes or no.

Should you take a measure that is not included in your policies and procedures, you would have to include details of that measure taken in your record of unsuccessful reasonable measures.

Retention: You must keep records of your unsuccessful reasonable measures for at least five years following the date they were created.

Exceptions to record keeping requirements

If you are required to keep a record about information that is readily available in other records that you have kept, you do not have to record the same information again. This means that if you keep the required information and can produce it during a FINTRAC examination you do not need to create a new record to meet your obligations.

You are not required to keep a large cash transaction record if the cash is received from a financial entity or a public body.

If you are an auctioneer that has precious metals, precious stones or jewellery that have been left with you for an auction sale, you are not required to keep a large cash transaction record.

March 2021 

March 2021

This guidance comes into effect on June 1, 2021.

Dealers in precious metals and precious stones have record keeping requirements under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA) and associated Regulations.

This guidance outlines certain record keeping requirements for dealers in precious metals and precious stones. You have additional record keeping requirements that are detailed in the following guidance:

This guidance document answers the following questions:

  1. What records must I keep and what must they contain?
  2. What are my responsibilities when maintaining records?
  3. What are the exceptions to the record keeping requirements?

**Note: Throughout this guidance, all references to dollar amounts (such as $10,000) are in Canadian dollars.

1. What records must I keep and what must they contain?

You must keep the following records:

  1. Reports — a copy of every report sent to FINTRAC
    • Suspicious Transaction Reports
    • Terrorist Property Reports
    • Large Cash Transaction Reports
    • Large Virtual Currency (VC) Transaction Reports
  2. Large cash transaction records
  3. Large virtual currency transaction records

**Note: When you are required to keep records about clients, you should be as descriptive as possible. Being descriptive when recording the nature of the principal business or occupation of a client will help determine whether a transaction or activity is consistent with what would be expected for that client. For example, when the client's occupation is "manager", the record should reflect the area of management, such as "hotel reservations manager" or "retail clothing store manager". When an entity's principal business area is "sales", the record should specify the type of sales, such as "pharmaceutical sales" or "retail sales".

a. Reports – a copy of every report sent to FINTRAC

You must keep a copy of every report that you submit to FINTRAC as a record.

Suspicious Transaction Reports

When you submit a Suspicious Transaction Report (STR) to FINTRAC, you must keep a copy of it.Footnote 1

Retention: At least five years after the day the STR was submitted.Footnote 2

Terrorist Property Reports

When you submit a Terrorist Property Report (TPR) to FINTRAC, you must keep a copy of it.Footnote 3

Retention: At least five years after the day the TPR was submitted.Footnote 4

Large Cash Transaction Reports

When you submit a Large Cash Transaction Report (LCTR) to FINTRAC, you must keep a copy of it.Footnote 5

Retention: At least five years from the date the LCTR was created.Footnote 6

Large Virtual Currency Transaction Reports

When you submit a Large Virtual Currency Transaction Report (LVCTR) to FINTRAC, you must keep a copy of it.Footnote 7

Retention: At least five years from the date the LVCTR was created.Footnote 8

b. Large cash transaction records

You must keep a large cash transaction record when you receive $10,000 or more in cash.Footnote 9

If you authorize a person or an entity to receive funds on your behalf, and that person or entity receives $10,000 or more in cash in accordance with the authorization, you are deemed to have received the amount when it is received by the person or entity, and you must keep a large cash transaction record.Footnote 10

**Note: This requirement is subject to the 24-hour rule.Footnote 11

A large cash transaction record must include:Footnote 12

  • the date you received the cash;
  • for any person involved in the transaction (including the person from whom you received the cash), their name, address, date of birth, and occupation, or in the case of a sole proprietor, the nature of their principal business;
  • for any entity involved in the transaction (including the entity from which you received the cash), their name, address and nature of their principal business;
  • the type and amount of each fiat currency received;
  • the purpose of the transaction (for example, the cash was used to purchase jewellery or precious metals or precious stones, etc.);
  • the method by which you received the cash (for example, in person, by mail, by armoured car, etc.);
  • the exchange rates used and their source (if applicable);
  • if an account was affected by the transaction, include:
    • the account number and type of account (for example, business, personal, etc.); and
    • the name of each account holder; 
  • every reference number connected to the transaction that is meant to be similar to an account number;
  • the following details about the remittance (i.e. the disposition) of, or exchange for, the cash received:
    • the method of remittance (for example, wire transfer, money order, etc.);
    • if the remittance is in funds, the type and amount of each type of funds involved;
    • if the remittance is not in funds, the type of remittance (for example, virtual currency, precious stones, etc.) and value if different from the amount received in cash; and
    • the name of every person or entity involved in the remittance, their account number or policy number. If there is no account or policy number, their identifying number:
  • when cash is received for the sale of precious metals, precious stones or jewellery, you must also record:
    • the type of precious metals, precious stones or jewellery involved in the transaction;
    • the value of the precious metals, precious stones or jewellery, if different from the amount of the cash received; and
    • the wholesale value of the precious metals, precious stones or jewellery (that is, the amount you had paid for the item).

Retention: At least five years from the date the large cash transaction record was created.Footnote 13

c. Large virtual currency transaction records

You must keep a large virtual currency (VC) transaction record when you receive VC in an amount equivalent to $10,000 or more.Footnote 14

If you authorize a person or an entity to receive VC on your behalf, and that person or entity receives VC in an amount equivalent to $10,000 or more in accordance with the authorization, you are deemed to have received the VC when it is received by the  person or entity, and you must keep a large VC transaction record.Footnote 15

**Note: This requirement is subject to the 24-hour rule.Footnote 16

A large VC transaction record must include:Footnote 17

  • the date you received the VC;
  • for any person involved in the transaction (including the person from whom you received the VC), their name, address, date of birth, and their occupation, or in the case of a sole proprietor, the nature of their principal business;
  • for any entity involved in the transaction (including the entity from which you received the VC), their name, address and the nature of their principal business;
  • the type and amount of each VC received;
  • the exchange rates used and their source;
  • if an account was affected by the transaction, include:
    • the account number and type of account; and
    • the name of each account holder;
  • every reference number connected to the transaction that is meant to be similar to an account number;
  • every transaction identifier (this may include a transaction hash or a similar identifier, if applicable), and every sending and receiving address;
  • when VC is received for the sale of precious metals, precious stones or jewellery, you must also record:
    • the type of precious metals, precious stones or jewellery;
    • the value of the precious metals, precious stones or jewellery, if different from the amount received in VC; and
    • the wholesale value of the precious metals, precious stones or jewellery (that is, the amount you had paid for the item).

Retention: At least five years from the date the large virtual currency transaction record was created.Footnote 18

2. What are my responsibilities when maintaining records?

In order to comply with your record keeping requirements, you must keep records in such a manner that they can be provided to FINTRAC within 30 days of a request.Footnote 19 The records may also be requested through a judicial order by law enforcement to support an investigation of money laundering or terrorist activity financing. A record (or a copy) may be kept in a machine-readable or electronic form, so long as a paper copy can easily be produced.Footnote 20

Employees who keep records for you are not required to keep them after their employment ends. The same is true for persons in a contractual relationship with you, when the contractual relationship ends.Footnote 21 You have to obtain and keep the records that were kept for you by an employee or a contractor before the end of the person's employment or contract.

There may be situations where you are required to keep records for purposes other than complying with your obligations under the PCMLTFA. For example, a federal or provincial regulator may require you to keep records in addition to those described in this guidance. If this is the case, you must still meet the requirements described in this guidance. For example, the retention period for your records can be longer than what is described, but it cannot be shorter.

3. What are the exceptions to the record keeping requirements?

If you are required to keep a record with information that is readily available in other records, you do not have to record the information again.Footnote 22

For example, when you keep a copy of a large cash transaction report (LCTR) you may choose to use this as your large cash transaction record for the same transaction, so long as all of the information that would otherwise be kept in the large cash transaction record is captured within the report. Any requirement related to keeping the large cash transaction record would still apply, such as verifying identity.

Financial entities and public bodies

You are not required to keep a large cash transaction record or a large VC transaction record if the cash or VC was received from a client that is a financial entity (FE) or a public body, or a person who is acting on behalf of a client that is an FE or public body.Footnote 23

Virtual currency

When you receive VC as compensation for the validation of a transaction that is recorded in a distributed ledger  or you receive a nominal amount of VC for the sole purpose of validating another transaction or a transfer of information, you do not need to keep a large VC transaction record.Footnote 24

Date Modified: