Canada Takes Lead in Combating Terrorist Financing through Formal Mutual Legal Assistance

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Ottawa, Canada - In its ongoing efforts to combat money laundering and terrorist financing, the Government of Canada is playing a leading role in the international community. Through its Department of Justice Canada, Canada is providing formal mutual legal assistance (MLA) to other countries to help track down and disrupt terrorist financing networks.

International Cooperation

Canada recognizes that protecting the integrity of the international financial system from money laundering and terrorist financing requires a strong international response. To this end, Canada has taken a leading role in:

The Financial Action Task Force (FATF), developing and implementing anti-money laundering and counter-terrorism financing (AML/ATF) standards
The G-7 and G-20, promoting global cooperation on AML/ATF
Other international forums, increasing AML/ATF capacity in countries with weaker regimes

Domestic AML/ATF Regime

Canada’s domestic AML/ATF regime consists of three pillars:

Reporting entities (financial institutions and designated non-financial businesses and professions) implement AML/ATF measures
Regulators (FINTRAC and OSFI) supervise reporting entities to ensure compliance with AML/ATF regulations

Pillar 2: Detecting Illicit Funds

Transparency of corporations and trusts is critical in detecting illicit funds
Provincial and federal corporate laws and registries, as well as securities regulation, contribute to preventing and detecting money laundering and terrorist financing

Pillar 3: Investigating and Disrupting Money Laundering and Terrorist Financing

Regime partners (CSIS, CBSA, RCMP) undertake financial investigations in relation to money laundering, terrorist financing, and other profit-oriented crimes
FINTRAC’s intelligence gathering and analysis activities support these investigations
The CRA plays a critical role in investigating tax evasion and detecting charities that may be at risk of being used to finance terrorism

Risk Assessment and Review

To ensure the effectiveness of its AML/ATF regime, Canada:

Regularly reviews measures against international standards
Assesses risks on an ongoing basis using a rigorous and systematic analysis of qualitative and quantitative data and expert opinion

Enhancements to the Regime

The Government has announced enhancements to the AML/ATF regime, including:

Strengthening customer due diligence requirements
Improving compliance and enforcement
Authorizing the Minister of Finance to issue countermeasures against jurisdictions with weak ML/TF controls

Through its leadership in combating terrorist financing, Canada is demonstrating its commitment to protecting the integrity of the international financial system and disrupting the activities of terrorist organizations.