If you do not have a place of business in Canada, see Foreign money services businesses.
If you are unsure, see The difference between money services businesses and foreign money services businesses.
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, knowing your clients, and having a compliance program. To begin the MSB registration process, please complete and submit the Pre-registration form(This will open a new window).
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 for another (for example, exchanging USD for CAD).
However, purchases made with foreign currency are not considered a foreign exchange. For example:
- 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 entity to another using an electronic funds transfer network or any other method such as Hawala, Hundi, Fei ch'ien, and Chitti.
Issuing or redeeming money orders, traveller's cheques or anything similar
— Your business issues or redeems money orders, travellers' cheques or other similar negotiable instruments.
- To offer your own business's money orders or travellers cheques.
- To repurchase your own business's money orders or traveller's cheques by returning the purchase price to the buyer.
- SELLING OR CASHING
- To exclusively sell or cash the money orders or traveller's cheques of another business that issued the money order or traveller's cheque, does not make you an MSB.
— This does not include cashing cheques made out to a particular individual or entity.
Dealing in virtual currency (coming into force June 1st, 2020)
— This includes both virtual currency exchange and virtual currency transfer services.
- Virtual currency exchange services include exchanging:
- funds for virtual currency,
- virtual currency for funds or,
- virtual currency for another virtual currency.
- Virtual currency transfer services include:
- transferring virtual currency at the request of a client or,
- receiving a transfer of virtual currency for remittance to a beneficiary.
You are also considered a money services business if:
- You hold a permit or licence related to any of the above-mentioned services.
- You are registered as someone offering any of the above-mentioned services.
- You advertise (by any means, including newspaper, television, Yellow Pages, internet, any other media, or by an interior or exterior sign) that you engage in any of the above-mentioned services.
- You do not advertise any MSB services, but you:
- offer money transfer services in any amount;
- conduct foreign exchange transactions for more than $1,000 during a single transaction with the same individual or entity. For these purposes, a single transaction is defined as two or more transactions related to a foreign exchange transaction of less than $1,000 each that are made within 24 consecutive hours and that total $1,000 or more;
- issue or redeem money orders, traveller's cheques or other similar negotiable instruments for more than $1,000 during a single transaction with the same individual or entity. For these purposes, a single transaction is defined as two or more transactions related to the redemption of money orders, travellers' cheques or other similar negotiable instruments of less than $1,000 each that are made within 24 consecutive hours and that total $1,000 or more;
- You report the income of any of the above-mentioned services as income from a separate business for tax purposes.
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.
- You carry out MSB activity in the course of providing other services 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 ABC Investment Advisors Inc. is carrying out the MSB activity in the course of providing investment services as a securities dealer.
Register your money services business (MSB)
Before beginning to operate in Canada, you must register your money services business (MSB) with FINTRAC. Even if you are registered as an MSB with a province or territory, you still have to register with FINTRAC. For all your MSB registration obligations, see Register your money services business.
A comprehensive and effective compliance program is the basis of meeting all of your obligations under the PCMLTFA and associated Regulations. During a FINTRAC examination, it is important to demonstrate that the required documentation is in place and that employees, agents, and all others authorized to act on your behalf are well trained and can effectively implement all the elements of your compliance program. A senior officer must approve the compliance program and the compliance officer must have the necessary authority to carry out the requirements of the program. You must:
- appoint a compliance officer responsible for the implementation and oversight of the compliance program;
- develop and apply written compliance policies and procedures that are kept up to date and approved by a senior officer;
- apply and document a risk assessment , including mitigation measures and strategies;
- develop and maintain a written training program for employees, agents, and others authorized to act on your behalf;
- review your compliance program (policies and procedures, risk assessment and training program) every two years for the purpose of testing its effectiveness.
See Compliance program requirements, the Risk-based approach guide and the Risk-based approach workbook for MSBs for more information on these obligations.
Know your client
As a money services business, you must verify the identity of clients for certain activities and transactions according to the Proceeds of Crime (Money Laundering) and Terrorist Financing Regulations (PCMLTFR). Part of knowing your client includes following the methods to identify clients, as well as conducting certain additional activities as listed below:
- When to identify individuals and confirm the existence of entities – Money services businesses;
- Methods to verify the identity of an individual and confirm the existence of a corporation or an entity other than a corporation;
- Business relationship requirements;
- Ongoing monitoring requirements;
- Beneficial ownership requirements;
- Third party determination requirements; and
- Politically exposed persons and heads of international organizations – Money services businesses.
Money services businesses are required to complete reports about certain transactions and property and submit them to FINTRAC. Financial transaction reports are critical to FINTRAC's ability to analyze transactions in order to develop financial intelligence that is disclosed to law enforcement and partner agencies. Therefore, the quality of your reporting will be reviewed by FINTRAC in examinations.
Suspicious transactions: Within 30 days of determining that there are reasonable grounds to suspect that a transaction or an attempted transaction is related to the commission or attempted commission of a money laundering or terrorist financing offence, you must submit a suspicious transaction report (STR). The following STR guidance trilogy explains how to identify and report STRs and all three should be read together. See What is a suspicious transaction report?, Reporting suspicious transactions to FINTRAC and Money laundering and terrorist financing indicators - Money services businesses.
Terrorist property: When you know that property in your possession or under your control is owned, controlled by or on behalf of a terrorist or a terrorist group, you must disclose this information to the Royal Canadian Mounted Police (RCMP) and the Canadian Security Intelligence Service (CSIS) and submit a Terrorist Property Report to FINTRAC without delay. See Guideline 5: Submitting Terrorist Property Reports.
Large cash transactions: When you receive $10,000 CAD or more in cash (including taxes or other fees) either in a single transaction or in multiple transactions within a 24-hour period, you must submit a report within 15 calendar days. See Guideline 7A: Submitting Large Cash Transaction Reports to FINTRAC electronically and Guideline 7B: Submitting Large Cash Transaction Reports to FINTRAC by paper.
Electronic funds transfers: When you send or receive client-initiated instructions to transfer $10,000 CAD or more internationally; either in a single transaction or in multiple transactions within a 24-hour period, you must submit a report within 5 business days. See Guideline 8A: Submitting non-SWIFT Electronic Funds Transfer Reports to FINTRAC electronically, Guideline 8B: Submitting SWIFT Electronic Funds Transfer Reports to FINTRAC and Guideline 8C: Submitting non-SWIFT Electronic Funds Transfer Reports to FINTRAC by paper.
If you have a computer and an internet connection, you must submit all reports to FINTRAC electronically, except Terrorist Property reports, which can only be submitted on paper or by fax at 1-866-226-2346.
You are responsible for keeping certain records. These records are to be kept in such a way that they can be provided to FINTRAC within 30 days if required to do so. See Record keeping for money services businesses for details.
If you do not meet all of these obligations, you may be assessed, or incur penalties or other consequences.
FINTRAC has created a Guidance glossary that defines certain terms used throughout its guidance documents.
- Administrative monetary penalties (AMPs)
Civil penalties that may be issued to reporting entities by FINTRAC for non-compliance with the PCMLTFA and related regulations. (pénalité administrative pécuniaire [PAP])
An entity is affiliated with another entity if one of them is wholly owned by the other, if both are wholly owned by the same entity or if their financial statements are consolidated. (entité du même groupe)
- As soon as practicable
A time period that falls in-between immediately and as soon as possible within which a suspicious transaction report (STR) be submitted to FINTRAC. In this context, the report must be completed promptly, taking into account the facts and circumstances of the situation. While some amount of delay is permitted, it must have a reasonable explanation. The completion and submission of the report should take priority over other tasks. (aussitôt que possible)
- Attempted transaction
Occurs when an individual initiates a transaction and it does not result in the movement of funds or purchase or sale of an asset because the transaction is not completed. For example, a potential client walks away from conducting a $10,000 cash deposit because they do not want to provide their identification. (opération tentée)
In respect of a government-issued photo identification document that is used to verify identity, is genuine and has the character of an original, credible, and reliable document issued by the competent authority (federal, provincial, territorial government). (authentique)
- Beneficial Owner(s)
Beneficial owners are the actual individuals who are the trustees, and known beneficiaries and settlors of a trust, or who directly or indirectly own or control 25% or more i) of a corporation or ii) an entity other than a corporation or trust, such as a partnership. The ultimate beneficial owner(s) cannot be another corporation or entity; it must be the actual individual(s) who are the owners or controllers of the entity. (bénéficiaire effectif)
A beneficiary is the individual or entity who will ultimately benefit from a transaction and be the final recipient of the funds. (bénéficiaire)
A branch is a part of your own business at a distinct location other than your main office. (succursale)
- Certified translator
An individual that holds the title of professional certified translator granted by a Canadian provincial or territorial association or body competent under Canadian provincial or territorial law to issue such certification. (traducteur agréé)
- Clarification request
A clarification request is a method used to communicate with money services businesses when FINTRAC needs more information about their registration form. This request is usually sent by email. (demande de précisions)
A person or entity that engages in financial transactions through your business. (client)
- Competent authority
Any person or organization that has the legally delegated or invested authority, capacity, or power to issue criminal record checks. (autorité compétente)
- Completed transaction
Is a transaction initiated by a person or entity that results in the movement of funds or purchase or sale of an asset. (opération effectuée)
- Compliance officer
The individual, with the necessary authority, you appoint to be responsible for the implementation of your compliance program. (agent de conformité)
- Compliance policies and procedures
Written methodology outlining all of your obligations applicable to your business under the PCMLTFA and its associated Regulations and the corresponding processes and controls you have put in place to address your obligations. (politiques et procédures de conformité)
- Compliance program
All elements (compliance officer, policies and procedures, risk assessment, training program, effectiveness review) that you, as a reporting entity, are legally required to have under the PCMLTFA and its associated Regulations to ensure that you meet all of your reporting, record keeping, client identification, and know-your-client requirements. (programme de conformité)
Clarifies a set of circumstances or provides an explanation of a situation or financial transaction that can be understood and assessed. (contexte)
- Country of residence
The country where an individual has lived continuously for 12 months or more. The individual must have a dwelling in the country concerned. For greater certainty, a person only has one country of residence no matter how many dwelling places they may have, inside or outside of that country. (pays de résidence)
- Credit card acquiring business
A credit card acquiring business is a financial entity that has an agreement with a merchant to provide the following services:
- enabling a merchant to accept credit card payments by cardholders for goods and services and to receive payment for credit card purchases;
- processing services, payment settlements and providing point-of-sale equipment (such as computer terminals); and
- providing other ancillary services to the merchant.
In respect of a document or source of information that is used to verify identity, is up to date, and, in the case of a government-issued photo identification document, must not have been expired when the ID was verified. (à jour)
- Directing Services
The services offered by the person or entity take into consideration a Canadian audience (for example, needs, customs, wealth, laws, etc.). (diriger des services)
With respect to a financial transaction, the disposition is what the funds were used for. For example, an individual arrives at a bank with cash and purchases a bank draft. The disposition is the purchase of the bank draft. (répartition de fonds)
- Electronic funds transfer (EFT)
An electronic funds transfer (money transfer) means the transmission of instructions, for the transfer of funds, to or from Canada. An electronic funds transfer does not include the instructions for the transfer of funds from one place in Canada to another in Canada. (télévirement)
Can be a corporation, trust, partnership, fund, or an unincorporated association or organization. (entité)
Actual events, actions, occurrences or elements that exist or are known to have happened or existed. Facts are not opinions. For example, facts surrounding a transaction or multiple transactions could include the date, time, location, amount or type of transaction or could include the account details, particular business lines, or the client’s financial history. (faits)
- Financial account
Refers to deposit, credit card or other loan accounts held by a financial entity. This does not include investment accounts such as Registered Retirement Savings Plans (RRSPs). (compte financier)
- Financial entity
A financial entity includes:
- a bank that is regulated by the Bank Act;
- an authorized foreign bank, as defined in section 2 of that Act, in respect of its business in Canada;
- a cooperative credit society, savings and credit union or caisse populaire that is regulated by a provincial Act;
- an association that is regulated by the Cooperative Credit Associations Act;
- a financial services cooperative, a credit union central, a company that is regulated by the Trust and Loan Companies Act;
- a trust company or loan company that is regulated by a provincial Act; and
- a department or an entity that is an agent or mandatary of Her Majesty in right of Canada or of a province when it is carrying out an activity referred to in section 45 of the PCMLTFR.
- Financial transaction
A financial transaction can indicate one or more instances of an attempted or completed movement of funds or purchase or sale of an asset. (opération financière)
- Individual or person
A human being. (individu ou personne)
- Institutional trust
An institutional trust is a trust that is established by a corporation, partnership or other entity for a particular business purpose and includes pension plan trusts, pension master trusts, supplemental pension plan trusts, mutual fund trusts, pooled fund trusts, registered retirement savings plan trusts, registered retirement income fund trusts, registered education savings plan trusts, group registered retirement savings plan trusts, deferred profit sharing plan trusts, employee profit sharing plan trusts, retirement compensation arrangement trusts, employee savings plan trusts, health and welfare trusts, unemployment benefit plan trusts, foreign insurance company trusts, foreign reinsurance trusts, reinsurance trusts, real estate investment trusts, environmental trusts and trusts established in respect of endowments, foundations and registered charities. (fiducie institutionnelle)
- Inter vivos trust
Also known as a living trust, this is a trust that is not created by a will. This type of trust is established by a living individual for the benefit of another individual, such as a trust created by a parent for a child. Its assets can be distributed to the beneficiary during or after a settlor’s lifetime. (fiducie entre vifs)
- Listed person
A listed person means anyone on a list published in the Schedule of the Regulations Implementing the United Nations Resolutions on the Suppression of Terrorism issued under the United Nations Act.
A listed person includes an individual, a corporation, a trust, a partnership or fund or an unincorporated association or organization that is believed to:
- have carried out, attempted to carry out, participated in or facilitated a terrorist activity; or
- be controlled directly or indirectly by, be acting on behalf of, at the direction of, or in association with any individual or entity conducting any of the above activities.
- Marketing or Advertising
The person or entity uses promotional materials such as advertisements, graphics for websites or billboards, etc., with the intent to promote services and to acquire business from persons or entities in Canada. (marketing ou publicité)
- Minute book
A record that contains the corporate documents of a company. It can include documents such as the articles of incorporation, general operating by-laws, first director resolution, registers, forms, share certificates and minutes of shareholders and directors meetings. (registre des procès-verbaux)
- Money laundering and terrorist financing indicators (ML/TF indicators)
Potential red flags that could initiate suspicion or indicate that something may be unusual in the absence of a reasonable explanation. [Indicateurs de blanchiment d’argent (BA) et de financement du terrorisme (FT) (indicateurs de BA/FT)]
- Money laundering offence
Means an offence under subsection 462.31(1) of the Criminal Code. The United Nations defines money laundering as "any act or attempted act to disguise the source of money or assets derived from criminal activity." Essentially, money laundering is the process whereby "dirty money"— produced through criminal activity— is transformed into "clean money," the criminal origin of which is difficult to trace. (infraction de recyclage des produits de la criminalité [blanchiment d’argent])
- Money services business agent
An individual or organization authorized to deliver services on behalf of a money services business (MSB). It is not an MSB branch. (mandataire d’une entreprise de services monétaires)
- No apparent reason
There is no clear explanation to account for suspicious behaviour or information. (sans raison apparente)
The job or profession of a client. (profession ou métier)
In regards to completing a suspicious transaction report (STR), the likelihood that a transaction may be related to a money laundering/terrorist financing (ML/TF) offence. For example, based on your assessment of facts, context and ML/TF indicators you have reasonable grounds to suspect that a transaction is possibly related to the commission or attempted commission of an ML/TF offence. (possibilité)
- Principal business
The nature of the primary business of an entity. (entreprise principale)
The likelihood in regards to completing an suspicious transaction report (STR) that a financial transaction is related to a money laundering/terrorist financing (ML/TF) offence. For example, based on facts you have reasonable grounds to believe that a transaction is probably related to the commission or attempted commission of an ML/TF offence. (probabilité)
- Production order
A judicial order that compels a person or entity to disclose records to peace officers or public officers. (ordonnance de communication)
- Public body
- any department or agent or mandatary of Her Majesty in right of Canada or of a province;
- an incorporated city or town, village, metropolitan authority, township, district, county, rural municipality or other incorporated municipal body in Canada or an agent or mandatary in Canada of any of them; and
- an organization that operates a public hospital and that is designated by the Minister of National Revenue as a hospital authority under the Excise Tax Act, or an agent or mandatary of such an organization.
- Reasonable measures
Reasonable measures means that you must take steps to collect certain information, even if taking those steps did not result in the desired information being obtained. For example, this can include doing one or more of the following:
- asking the client,
- conducting open source searches, or
- consulting commercially available information.
In respect of information that is used to verify identity, means that the source is well known, reputable, and is considered one that you trust to verify the identity of the client. (fiable)
- Representative for service
An individual in Canada that has been appointed by a person or entity that is a foreign money services business (FMSB), pursuant to the PCMLTFA, to receive notices and documents on behalf of the FMSB. (représentant du service)
- Risk Assessment
Is an analysis and an application of policies and procedures of potential risks and vulnerabilities that could expose your business to money laundering/terrorist financing (ML/TF) activities. (évaluation des risques)
- Senior officer
A senior officer of an organization can be:
- a director who is also a full time employee;
- a chief executive officer, chief operating officer, president, secretary treasurer, controller, chief financial officer, chief accountant, chief auditor or chief actuary, or any individual who performs these similar duties; or
- any other officer who reports directly to the board of directors, chief executive officer or chief operating officer.
- Service agreement
With respect to money services businesses (MSBs), an agreement between you and another organization for you to provide them with any of the following MSB services on an ongoing basis:
- money transfers;
- foreign currency exchange; or
- issuing or redeeming money orders, traveller's cheques or anything similar.
A settlor is an individual or entity that creates a trust with a written trust declaration. The settlor ensures that legal responsibility for the trust is then given to a trustee and that the trustee is provided with a trust instrument document that explains how the trust is to be used for the beneficiaries. A settlor includes any individual or entity that contributes financially to that trust, either directly or indirectly. (constituant)
The issuer or provider of information or documents for verifying identification. (source)
The Society for Worldwide Interbank Financial Telecommunication (SWIFT) network is a global member-owned cooperative and an international provider of secure financial messaging services. (SWIFT)
- Terrorist activity financing offence
A terrorist financing offence is knowingly collecting or giving property (such as money) to carry out terrorist activities. This includes the use and possession of any property to help carry out the terrorist activities. The money earned for terrorist financing can be from legal sources, such as personal donations and profits from a business or charitable organization or from criminal sources, such as the drug trade, the smuggling of weapons and other goods, fraud, kidnapping and extortion.(infraction de financement des activités terroristes)
- Third party
Any individual or entity that instructs someone to act on their behalf for a financial activity or transaction. (tiers)
- Training program
A written and implemented program outlining the ongoing training for your employees, agents or other individuals authorized to act on your behalf about all your obligations and requirements to be fulfilled under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act and its associated Regulations. (programme de formation)
A right of property held by one individual or entity (a trustee) for the benefit of another individual or entity (a beneficiary). (fiducie)
A trustee is the individual or entity authorized to hold or administer the assets of a trust. (fiduciaire)
In the context of civil law, a person who has been lawfully appointed to the care of the person and property of a minor. (tuteur)
- Two year effectiveness review
A review, conducted every two years (at a minimum), by an internal or external auditor to test the effectiveness of your policies and procedures, risk assessment, and training program. (examen bisannuel de l'efficacité)
In respect of a document or information that is used to verify identity, appears legitimate or authentic and does not appear to have been altered or had any information redacted. The information must also be valid according to the issuer, for example if a passport is invalid because of a name change, it is not valid for FINTRAC purposes. (valide)
- Verify client identity
To refer to certain information or documentation to identify a client and ensure that their information matches what you know about them. (vérifier l’identité d’un client)
- Very large corporation
Very large corporation has minimum net assets of $75 million CAD on its last audited balance sheet. The corporation's shares have to be traded on a Canadian stock exchange or on a stock exchange outside Canada that is designated by the Minister of Finance. The corporation also has to operate in a country that is a member of the Financial Action Task Force (FATF). (personne morale dont l’actif est très important)
- Working days
A working day is a day between and including Monday to Friday. It excludes Saturday, Sunday, and a public holiday. (jour ouvrable)
- Date Modified: