Accountants

Accountants and accounting firms must fulfill specific obligations as required by the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA) and associated Regulations to help combat money laundering and terrorist activity financing in Canada. For the purpose of the PCMLTFA, an accountant includes a chartered accountant, a certified general accountant, a certified management accountant or, if applicable, a chartered professional accountant; and an accounting firm is an entity engaged in the business of providing accounting services to the public and that has at least one partner, employee or administrator that is an accountant.

Accountants and accounting firms are subject to the PCMLTFA when they engage in any of the following activities on behalf of a person or entity, or give instructions on behalf of a person or entity in respect of:

These activities do not include those that are carried out in the course of an audit, a review or a compilation engagement within the meaning of the CPA Canada Handbook prepared and published by the Chartered Professional Accountants of Canada.

You are subject to the requirements described further below when you engage in these activities, regardless of whether you receive fees or have a formal letter of engagement to do so. In other words, even if you carry out these activities on a voluntary basis, you are subject to the requirements of the PCMLTFA.

If you are paid for your accounting services, the receipt of the professional fees does not trigger associated obligations under the PCMLTFA.

When you give instructions for any of the triggering activities, it means that you actually direct the movement of funds. By contrast, when you provide advice to your clients, it means that you make recommendations or suggestions to them. Providing advice is not considered to be giving instructions.

If you are an accountant who is authorized by law to carry on the business of, or to monitor the business or financial affairs of, an insolvent or bankrupt person or entity; or you are authorized to act under a security agreement, you are not subject to the PCMLTFA or associated Regulations.

If you are an accountant acting in the capacity of an employee, the requirements described further below do not apply to you, with the exception of submitting suspicious transaction reports (STRs) to FINTRAC which is applicable to both you and your employer if your employer is a reporting entity.

Accountants and accounting firms are responsible for the following requirements under the PCMLTFA and associated Regulations.

*Note: On June 1, 2021, regulatory amendments, which will create or change obligations for all reporting entities (REs) subject to the PCMLTFA and associated Regulations, will come into force. FINTRAC expects that REs will comply with the amended Regulations, but will exercise flexibility in assessing and enforcing compliance with certain record keeping and reporting requirements. See the Notice on forthcoming regulatory amendments and flexibility for more information.

Table 1—Summary of requirements for accountants
Category of requirement under the PCMLTFA and associated Regulations Requirements
Compliance program

Accountants must implement a compliance program. A strong compliance program will form the basis of meeting all your regulatory requirements. For more information, see Compliance program requirements and the Risk assessment guidance.

Know your client

Accountants must verify the identity of persons and entities for certain activities and transactions, and carry out other customer due diligence activities, as described below:

When to verify the identity of persons and entities
Accountants must verify the identity of persons or entities for certain transactions and activities. For more information, see When to verify the identity of persons and entities – Accountants.

Methods to verify the identity of persons and entities
Accountants must verify the identity of persons and entities using the methods prescribed by the PCMLTFA and associated Regulations. For more information, see Methods to verify the identity of persons and entities.

Business relationship requirements
Accountants enter into a business relationship with a client the second time they are required to verify the identity of that client. For more information, see Business relationship requirements.

Ongoing monitoring requirements
Accountants have ongoing monitoring requirements when they enter into a business relationship with a client. For more information, see Ongoing monitoring requirements.

Beneficial ownership requirements
Accountants must obtain and take reasonable measures to confirm the accuracy of beneficial ownership information for entities. For more information, see Beneficial ownership requirements.

Third party determination requirements
Accountants have third party determination requirements when they are required to submit certain reports and keep certain records. For more information, see Third party determination requirements.

Politically exposed persons (PEP) and heads of international organizations(HIO) requirements
Accountants are required to take reasonable measure to make PEP and HIO determinations for certain activities or transactions. If an accountant determines that a person is a PEP or a HIO then they have additional related requirements. For more information, see Politically exposed persons and heads of international organizations guidance and Politically exposed persons and heads of international organizations guidance for non-account-based reporting entity sectors.

Reporting

Accountants must submit the following reports to FINTRAC:

Suspicious transaction reports
For more information, see:

Terrorist property reports
For more information, see:

Large cash transaction reports 
For more information, see:

Large virtual currency transaction reports
For more information, see:

24-hour rule

Accountants have 24-hour rule requirements for large cash transaction reports and large virtual currency transaction reports. For more information, see Transaction reporting guidance: the 24-hour rule.

Record Keeping

Accountants must keep certain records, including records related to transactions and client identification. For more information, see Record keeping requirements for accountants.

Ministerial directives

Ministerial directive requirements apply to all reporting entity sectors. For more information, see Ministerial directives and transaction restrictions.

Penalties for non-compliance

FINTRAC has the legislative authority to issue administrative monetary penalties (AMPs) to reporting entities that are found to be non-compliant with the PCMLTFA and associated Regulations. For more information, see Penalties for non-compliance.

Glossary

The FINTRAC Guidance glossary includes terminology defined in the PCMLTFA and associated Regulations, as well as terms used throughout the guidance. For more information, see FINTRAC's Guidance Glossary.

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