New changes have been introduced. Anytime you buy or sell real estate, you will be required to fill out an additional form proving your identity. Some information below that I have taken from various sources to help you understand what’s going on.
Changes in federal Money Laundering and Terrorist Financing compliance requirements are now in effect.
Important: FINTRAC has advised that any listing agreement, offer, or purchase executed or completed prior to June 23rd, 2008 IS NOT subject to the new reporting requirements.
The changes will require brokers and sales representatives to collect more information than ever before.
How we got here
International efforts by governments to curb money-laundering activity took root at the 1989 G7 Summit in Paris, continued throughout the 1990’s, and escalated dramatically following the terrorist attacks on New York City in September of 2001.
The result of this activity led to the creation of an intergovernmental body in 1990 called the Financial Action Task Force, or FATF, an organization of 35 member countries to which Canada is a member. This international body sets global legislative and regulatory standards for member countries in order to assist them in developing frameworks to better combat the financing of criminal and/or terrorist financing activity.
Following the attack on the World Trade Centre, the Government of Canada introduced the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA) in early 2002. This legislation was accompanied by new regulations requiring targeted “high-risk” industries, including real estate, to implement client identification and record keeping requirements.
Then, in 2003, FATF issued 40 new counter-measures on money laundering and 9 special recommendations on terrorist financing to its member governments, and asked that they update their legislative and regulatory framework in order to better monitor and track suspicious financial transactions.
In response to this call, the Government of Canada developed and issued a consultation paper in July of 2005. This document contained proposals designed to address these international requirements, including concerns raised by the Auditor General in her 2004 report to Parliament.
Following a period of industry consultations, Finance Canada published proposed regulations in March 2007. These amendments captured 9 priority industries, including real estate brokers and salespersons.
In December 2007, CREA and the International Consortium of Real Estate Associations (ICREA), represented by then President Ann Bosley, also met with FATF officials in Berne, Switzerland to discuss how the real estate sector was expected to apply a “risk-based” approach to their compliance programs.
For further information, check out http://www.realtorlink.ca/content/fintrac/. This site is very detailed as well.
Any questions don’t hesitate to call or e-mail me.
The Salisbury Team
Royal LePage Niagara Real Estate Centre Inc., Brokerage
Toll Free – 1-800-467-8498
Office – 905-937-6000
View My Website at www.timothysalisbury.com
When Buying or Selling, please remember me!