Canada Implements New Anti-Money Laundering Laws

By Rishma Banerjee

As per recently published reports, it seems that Canada has made changes to its anti-money laundering rules, which means that they will now have to be followed by all the cryptocurrency exchanges operating in the country. The Canadian government modified the Proceeds of Crime (Money Laundering) and Terrorist Financing Act in the Canada Gazette yesterday.

While most of the rules are about the perceived gaps within traditional finance, but they also changed the game for companies “dealing in virtual currency.” The government defined such companies as offering “virtual currency exchange services and value transfer services.”

According to the new rules, both Canadian and foreign cryptocurrency platforms must register as money servicing businesses (MSBs) and also

“fulfill all obligations, including implementing a full compliance program and registering with FINTRAC [the Financial Transactions and Reports Analysis Centre of Canada].”

The new rules also make it compulsory for a company receiving CA$10,000 (US$7,667) or more in a single cryptocurrency transaction in the form of a deposit or payment, to report the deal with the following details:

The date of the receipt and if the amount is received for deposit into an account, the names of each account holder; details of every other person or entity involved in the transaction as well as the nature of their principal business or their occupation. In case of a person, they will have to furnish their date of birth; the type and amount of each virtual currency involved in the receipt, the exchange rates used and their source, the number of every other account that is affected by the transaction, the type of account and the name of each account holder. If the amount is received by a dealer in precious metals and precious stones for their sale, he/she will have to provide details about the type of precious metals, precious stones or jewellery, the value of the precious metals, precious stones or jewellery, if different from the amount of virtual currency received, and the wholesale value of the precious metals, precious stones or jewellery.

The government stated,

“The amendments help address and close the gaps that exist in Canada’s AML/ATF Regime, including regulating new business models and technologies and addressing new emerging risks.”