Transaction reporting guidance: the 24-hour rule

This guidance on the 24-hour rule explains the requirements under the PCMLTFR that are in effect as of June 1st, 2021. From June 1st, these obligations will apply only to the reporting of large virtual currency transactions. The obligations will apply to large cash transactions, electronic funds transfers, and casino disbursements when FINTRAC updates the report forms for those transactions.

Until then, reporting entities should continue to apply the 24-hour rule as outlined in FIN 4 (pre-June 1, 2021). Further details can be found in the Notice on forthcoming regulatory amendments and flexibility and the message concerning FINTRAC's Implementation of Regulatory Amendments.

Please note that this page will be updated to include additional information as the revised report forms become available.

May 2021

This guidance comes into effect on June 1, 2021.

This guidance describes when reporting entities (REs) must consider multiple transactions within a 24-hour period as a "single transaction". This concept is referred to as "the 24-hour rule", and applies to all REs as required by the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA) and associated Regulations.

This guidance answers the following questions:

  1. What is the 24-hour rule?
  2. How do I aggregate transactions under the 24-hour rule?
  3. To which reports does the 24-hour rule apply?
  4. What are the exceptions to the 24-hour rule?

*Note: Throughout this guidance, references to dollar amounts (such as $10,000) are in Canadian dollars or its equivalent in foreign currency or virtual currency (VC).

This guidance includes the following annexes:

*Note: Only Annex 3 is available. The other annexes will be added at a later date.

1. What is the 24-hour rule?

The 24-hour rule is the requirement to aggregate multiple transactions when they total $10,000 or more within a consecutive 24-hour window and the transactions are:Footnote 1

For further clarity, as an example, when two or more cash transactions that total $10,000 or more are conducted by the same person, on behalf of the same person, or for the same beneficiary, the 24-hour rule must be considered. However, if an amount under $10,000 is received from a person, and then another amount under $10,000 is received on behalf of that same person, and these amounts total $10,000 but are not for the same beneficiary, then the 24-hour rule is not triggered. This is because both transactions are not received by the same person, nor are they received on behalf of the same person.

All transactions that total $10,000 or more within a consecutive 24-hour window are to be reported to FINTRAC in a single report. This means that all transactions at or above the $10,000 threshold that occur in the same 24-hour window must be included in the report and should not be reported separately.

The following can occur within a consecutive 24-hour window and must be reported in a single report under the 24-hour rule:

The 24-hour rule should be considered broadly across your business if you have multiple locations in Canada. When transactions that fall under the 24-hour rule occur at multiple locations across your business, they should be reported in a single report. For more information, see the Reporting guidance specific to the transaction you are reporting.

**Note: The 24 hours that make up the period must be consecutive. The period cannot exceed 24 hours.Footnote 2

2. How do I aggregate transactions under the 24-hour rule?

To identify the transactions that need to be aggregated and reported under the 24-hour rule, you have to determine the beginning and the end of the 24-hour window. This window is called a static 24-hour window. For example, 9 am Monday to 8:59 am Tuesday.

You are not limited to one 24-hour window. You have the option of using different static 24-hour windows for different types of reports and for different business lines. For example, you may determine that for operational purposes or to capture core business as much as possible you will use a 12:00 am Monday to 11:59 pm Monday static 24-hour window, but for a specific business line you choose to use a different 24-hour window, for example, 8 pm Monday to 7:59 pm Tuesday.

Each transaction that falls under the 24-hour rule within a static 24-hour window will have to be viewed independently from the previous or subsequent static 24-hour window. Meaning that one transaction cannot fall under the 24-hour rule in multiple 24-hour windows. However, it is important to note that while you will monitor transactions for the applicability of the 24-hour rule within a static 24-hour window, you must also monitor all transactions, regardless of the static 24-hour window, to identify suspicious transactions that could relate to money laundering (ML) or terrorist activity financing (TF). For more information, see What is a suspicious transaction report?

Your policies and procedures must include the time when your 24-hour windows begin and end. You will also need to indicate the times that your 24-hour window begins and ends in a mandatory field when you submit a report to FINTRAC.

3. To which reports does the 24-hour rule apply?

The 24-hour rule applies to all reports that have a reporting threshold of $10,000. The requirements for each type of report are outlined below.

*Note: In a scenario where the conductor and beneficiary are the same person or entity, only one report is to be sent to FINTRAC, and you must not consider the person or entity as both the conductor and the beneficiary to the same transaction for aggregation purposes. Instead, you may choose to aggregate on the person or entity as the conductor only, or the beneficiary only. However, if another transaction occurred in which the same person or entity was the beneficiary only, then you must aggregate on them as the beneficiary for all transactions.

Large Cash Transaction Report (LCTR)

All REs have the obligation to report large cash transactions to FINTRAC in accordance with the 24-hour rule when:Footnote 3

Other requirements and exceptions apply. For more information, see Reporting large cash transaction to FINTRAC, and Annex 2.

Large Virtual Currency Transaction Report (LVCTR)

All REs have the obligation to report large virtual currency (VC) transactions to FINTRAC in accordance with the 24-hour rule when:Footnote 4

Other requirements and exceptions apply. For more information, see Reporting large virtual currency transactions to FINTRAC, Annex 3, and the exceptions in section 4 below.

Electronic Funds Transfer Report (EFTR)

Financial entities (FEs), money services businesses (MSBs), foreign money services businesses and (FMSBs) casinos must report electronic funds transfers to FINTRAC in accordance with the 24-hour rule when they:

Other requirements and exceptions apply. For more information, see Reporting Electronic Funds Transfers to FINTRAC, Annex 1, and the exceptions in section 4 below.

Casino Disbursement Report (CDR)

Casinos must report a casino disbursement to FINTRAC in accordance with the 24-hour rule when:Footnote 7

Other requirements and exceptions apply. For more information, see Reporting casino disbursements to FINTRAC , and Annex 4.

4. What are the exceptions to the 24-hour rule?

LVCTR

You do not have to submit an LVCTR when you receive two or more amounts of VC for the same beneficiary, if the amounts are each individually equivalent to less than $10,000, but together total an amount equivalent to $10,000 or more under the 24-hour rule, if the beneficiary is:Footnote 8

You cannot apply this exception to amounts of VC received for one of these beneficiaries under the 24-hour rule, if one or more of the amounts is individually equivalent to $10,000 or more. In this scenario you must submit a separate LVCTR to FINTRAC for each amount that is individually equivalent to $10,000 or more, as the reporting threshold has been met with the individual transaction.   

EFTR

You do not have to submit an EFTR for the initiation of two or more international EFTs that total $10,000 or more under the 24-hour rule if the EFTs are initiated at the request of or on behalf of:Footnote 9

You cannot apply this exception to international EFTs you initiate under the 24-hour rule at the request of, or on behalf of, one of these entities, if one or more of the international EFTs is individually in an amount of $10,000 or more. In this scenario, you must submit a separate EFTR to FINTRAC for each international EFT that is individually in an amount of $10,000 or more, as the reporting threshold has been met with each individual transaction.  

You do not have to submit an EFTR for the final receipt of two or more EFTs that total $10,000 or more under the 24-hour rule if the beneficiary is:Footnote 10

You cannot apply this exception to EFTs that you finally receive for one of these beneficiaries under the 24-hour rule, if one or more of the EFTs is individually in an amount of $10,000 or more. In this scenario, you must submit a separate EFTR to FINTRAC for each EFT that is individually in an amount of $10,000 or more, as the reporting threshold has been met with each individual transaction.   

**Note: Other obligations and related exceptions may apply. Please see your sector's Reporting and record keeping obligations for more information.

Annex 3 — LVCTR scenarios — 24-hour rule

Assumptions for the scenarios below:

Scenario 1 — Receipt of virtual currency – 24-hour rule — Aggregation on the beneficiary

Description:

LVCTR requirement

In this scenario, the MSB would submit an LVCTR under the 24-hour rule that combines the three transactions totalling an amount equivalent to $13,000 based on the beneficiary, which is Mr. Blue.

Scenario 2 — Receipt of virtual currency – 24-hour rule — Aggregation on the conductor

Description:

LVCTR requirement

In this scenario, the MSB would submit an LVCTR under the 24-hour rule that combines the three transactions totalling an amount equivalent to $12,000 based on the conductor, which is Mrs. White.

Scenario 3 — Receipt of virtual currency – 24-hour rule — Aggregation on the third party

Description:

LVCTR requirement

In this scenario, the MSB would submit an LVCTR under the 24-hour rule that combines the two transactions totalling an amount equivalent to $12,000 based on the third party, which is Ms. Red.

Date Modified: