Financial Crime World

Canada Introduces New Reporting Threshold for Virtual Currency Transactions

Ottawa, February 23, 2024 - A New Requirement for Financial Institutions and Reporting Entities

The Canadian government has announced a new reporting threshold for virtual currency transactions, requiring financial institutions and other reporting entities to report transactions of $10,000 CAD or more. This change aims to enhance the country’s ability to detect and prevent money laundering and terrorist financing.

Ministerial Directive: Key Highlights

  • Any virtual currency transaction received in an amount equivalent to $10,000 CAD or more must be reported using the Large Virtual Currency Transaction Report.
  • The directive also applies to negotiable instruments and issuing or redeeming transactions originating from or bound for Iran. In these cases, the report reference number must include the prefix “IR2020” before entering the reporting entity’s report reference number.

High-Risk Transactions: Additional Requirements

  • All transactions associated with Iran must be treated as high-risk and monitored for suspicious activity.
  • Reporting entities are required to submit a Suspicious Transaction Report or Terrorist Property Report to FINTRAC if there is reasonable grounds to suspect that the transaction is related to money laundering or terrorist financing.

Timeframes and Compliance

  • Electronic funds transfers require reporting within 5 working days.
  • Large cash transactions require reporting within 15 days.
  • Financial institutions and other reporting entities are required to have policies and procedures in place to ensure compliance with the Ministerial Directive. Failure to comply can result in serious administrative monetary penalties.

Importance of Transparency and Cooperation

The Canadian government has emphasized the importance of transparency and cooperation in the fight against money laundering and terrorist financing. The new reporting threshold is designed to support these efforts by enhancing the country’s ability to detect and prevent illegal activities.

Additional Resources

For more information on the Ministerial Directive, please visit the FINTRAC website. You can also consult with a qualified financial advisor for guidance on complying with this new requirement.