Canada’s financial crime watchdog has levied the largest number of penalties in its history against companies that failed to comply with anti-money-laundering laws, with the fines for its most recent fiscal year totalling $25-million.
The Financial Transactions and Reports Analysis Centre of Canada (FinTRAC) said in its annual report, released Thursday, that it issued 23 penalties between April 1, 2024, and March 31, 2025.
The financial intelligence unit also disclosed 32 cases of non-compliance to law enforcement to investigate criminally – more than double the number of compliance issues it passed along to police in its previous fiscal year and the most since FinTRAC’s creation in 2000.
“Working with businesses and supporting the efforts of law enforcement, we are playing an important role in deterring and detecting criminals that abuse Canada’s financial system,” Sarah Paquet, FinTRAC’s director and chief executive officer, said in the annual report.
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FinTRAC has been stepping up its enforcement activities as Canada looks to clamp down on financial crime, creating a new federal agency and introducing legislation that proposes to exponentially increase the penalties FinTRAC can levy.
There is also an imminent review planned for Canada’s anti-money-laundering regime by the Financial Action Task Force, an intergovernmental body that sets standards to combat money laundering and terrorist financing.
The figures in FinTRAC’s annual report do not include two large penalties against cryptocurrency exchanges it levied after its fiscal year had ended.
Last month, the watchdog issued a nearly $20-million penalty – at the time, its largest ever – against Seychelles-based Peken Global Ltd., which operates as KuCoin. FinTRAC said the crypto exchange failed to register as a money-services business and report suspicious transactions and large virtual currency transactions to the watchdog.
KuCoin has appealed the penalty to the Federal Court of Canada, arguing that it is not required to register with FinTRAC because it does not meet the definition of a Canadian money-services business.
Less than a month later, FinTRAC issued an even larger penalty – $176,960,190 – against Xeltox Enterprises Ltd., which operates as Cryptomus.
Canada’s anti-money-laundering regime requires entities such as financial institutions, real estate and mortgage brokers, casinos and cryptocurrency exchanges to report certain types of transactions, including suspicious transactions and large electronic funds transfers, to FinTRAC. In total, more than 38,000 businesses are required to report to the watchdog.
The centre analyzes the information it receives and discloses financial intelligence to law enforcement and national-security agencies.
Businesses reported 633,882 suspicious transactions during the watchdog’s most recent fiscal year, up from 631,137 the previous year.
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During that time, FinTRAC made 2,730 disclosures to law enforcement. Those disclosures included 511,480 of the more than 65 million transaction reports it received, with a heavy focus on suspicious transaction reports. (One disclosure can include hundreds of transaction reports and an even larger number of individual transactions.)
Michael Donovan, the chief anti-money-laundering officer at Canadian Imperial Bank of Commerce, said Thursday that the disclosures to law enforcement represent just a fraction of the transactions flagged to the financial crime watchdog.
“There has to be a way that we can be more focused on where the true money laundering risk is,” Mr. Donovan said at a conference held by the Association of Certified Anti-Money Laundering Specialists in Toronto.