Operational alert: Laundering of the proceeds of fentanyl trafficking

Laundering of the proceeds of fentanyl trafficking (PDF version, 138 KB)

Reference number: 17/18-SIDEL-003A
January 31, 2018

The prescription opioid fentanyl is used to treat severe pain caused by cancer and invasive surgeries. Carfentanil is a synthetic analogue of this drug, created for veterinary purposes to be more potent and cheaper. Traffickers are producing and distributing deadly black-market versions of fentanyl and its analogues to meet the demand for illicit prescription painkillers. The growing number of deaths from taking fentanyl is a public health crisis in Canada.

Financial intelligence suggests that traffickers procure fentanyl, and its analogues and precursors, from overseas sources, mainly in China. Traffickers most often pay for these materials with wire transfers and money orders processed by money services businesses, but use virtual currency in some instances. Fentanyl and its analogues are typically smuggled into Canada through the postal system, prior to being distributed through networks in a small area surrounding the arrival point. The laundering of the proceeds of fentanyl trafficking in Canada generally takes place through Canadian banks, caisses populaires and credit unions. It largely resembles the financial transactions associated with low-level drug trafficking but has some unique characteristics, as set out in the indicators, below.

Entities required to report to FINTRAC should consider the following indicators relevant to their sector in tandem with the low-level drug trafficking indicators that follow to effectively identify potential money laundering activities associated with the trafficking of fentanyl.

Indicators of procurement of fentanyl via money services businesses

Indicators of money laundering through banks, caisse populaires and credit unions

Indicators of laundering of the proceeds of low-level drug trafficking

Reporting to FINTRAC

To facilitate FINTRAC's disclosure process, please include the term #fentanyl in Part G—Description of suspicious activity on the Suspicious Transaction Report. (See also STR guidance.)

Contact FINTRAC

FINTRAC Operational Alerts provide up-to-date indicators of suspicious financial transactions and high-risk factors related to new, re-emerging or particularly topical methods of money laundering and terrorist activity financing.

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