fintrac eft reporting requirements

CaseWare and the CaseWare logo, are registered trademarks of CaseWare International Inc. and are licensed for use to CaseWare RCM.© 2021. As long as the first person to get the instruction gives the final sending person the name and the address of the originator it’s the final sending person that reports the transaction. EFT Reporting. This reporting covers EFTs that are the transmission of instructions for a transfer of funds through any electronic, magnetic or optical device, telephone instrument or computer other than SWIFT MT 103 messages described above. For subfield 2 (Name & Address), you should only provide the following codes on the lines: The number followed by a slash, '/' must be followed by the name of the ordering customer (where it is recommended that the surname precedes given name(s)). In terms of EFTs, Shinfield said regulators have “changed the whole reporting scheme.” “So for banks it will have probably a more favorable effect than others but for others it’s going to have huge operational implications.”. Electronic Funds Transfer Reporting Requirements 3.1 Electronic reporting enrolment. FINTRAC first required the reporting of cross-border electronic funds transfers (“EFT” reporting) in June 2002. There is also a new requirement that requires reporting entities to verify the identity of beneficiaries of EFTs of $1,000 or more, which is a net new requirement, she said. You do not have to make an EFT report if you send a transfer to an individual or an entity in Canada, even if the final recipient is outside Canada. The other reporting requirement for EFTs covers EFTs that are the transmission of instructions for a transfer of funds through any electronic, magnetic or optical device, telephone instrument or computer. OFAC Best Practices: AML Compliance and Sanction Screening, 6AMLD: EU’s 6th Anti-Money Laundering Directive, Latest FinCEN News, Guidance and Advisories, Creating an Effective Suspicious Activity Reporting Program, What’s New in Alessa – Core Functionality, How a Retailer and Money Service Business uses Alessa for AML Compliance, Energex: Using Alessa for Accounts Payables Monitoring, in a single transaction for $10,000 or more; or. “And on the converse side when the money comes into the country it’s the first organization to touch it.”. As per paragraphs 12(1)(b) and 12(1)(c) of the Proceeds of Crime (Money Laundering) and Terrorist Financing (PCMLTF) Regulations, financial entities are required to report the sending out of Canada and the receipt from outside Canada, at the request of a client, of an electronic funds transfer (EFT) of $10,000 or more in the course of a single transaction. What this means:Previously, ML/TF regulations didn’t require intermediaries of a transaction to collect information. In that regard, the proposed amendments add new recordkeeping and client identification requirements, similar to those that already exist for EFTs, when an MSB either: Transmits an amount of C$1,000 or more at the request of a person or entity, other than in the case of an EFT; or Lawyer Jacqueline Shinfield, an expert in FINTRAC regulations, says financial institutions need to be prepared for some sweeping changes in the ways Electronic Funds Transfers (EFTs) are done in Canada. There are also requirements relating to virtual currencies that apply to other types of reporting entities, including record-keeping, identification and reporting requirements for large virtual currency transactions (i.e., the receipt of $10,000 or more in a single transaction), subject to certain exceptions. The number followed by a slash, '/' must be followed by the ISO country code, a slash '/' and Town (Town can be complemented by postal code (for example zip), country subdivision (for example state, province, or county). You have to report the following transactions to FINTRAC: You send an outgoing SWIFT MT 103 message for $10,000 or more outside Canada at the request of a client in the following manner: You receive an incoming SWIFT MT 103 message for $10,000 or more sent from outside Canada at the request of a client in the following manner: These reports can only be made electronically using the batch file reporting mechanism (See Guideline 8B: Submitting SWIFT Electronic Funds Transfer Reports to FINTRAC). 2.3 All Other Electronic Funds Transfers. The number followed by a slash, '/' must be followed by the ISO country code, a slash '/' and the Place of Birth. However, ongoing monitoring requirements in the drafted Guideline 6G mentions the requirement keep all client identification information up to date which will require reporting entities to monitor all their clients on an individual level to ensure identification information is up … Outgoing EFTs of $10,000 or more outside Canada that is transmitted in a single transaction; or in two or more transfers of less than $10,000 (that total $10,000 or more) in the following 24-hour rule situations, Incoming EFTs of $10,000 or more outside Canada that is transmitted in a single transaction; or in two or more transfers of less than $10,000 (that total $10,000 or more) in the following 24-hour rule situations. For more information on how to submit EFTs to the CRA through the shared reporting process, go to Reporting to FINTRAC on the FINTRAC website. / Insights You send outgoing EFTs. As a reporting entity, you have to be enrolled with FINTRAC's electronic reporting system to report electronically. Electronic Funds Transfer Reports (EFTR) – A number of changes were made to the EFTR requirements proposed in the Draft Regulations in the Final Regulations aiming to clarify the fact that such requirements are intended to apply only to non-domestic EFTs. Given option F can also contain information that is not set out in Schedules 2 and 3, if your financial entity sends out or receives a MT 103 message in which option F was used, we recommend that you follow these guidelines when providing information to FINTRAC: When subfield 1 (Party Identifier) is used with the (Code)(Identifier) format, you should provide one of the following codes followed by the "/" character: However, DO NOT provide the values that follow the "/"" character. The reporting requirements for international EFTs involving multiple entities have also changed. The reporting requirements now apply in regards to both outgoing EFTs to the RE that initiates the EFT, and incoming EFTs to the RE that is the final recipient of the EFT. This reporting requirement is only applicable to financial entities or MSBs and where an outgoing SWIFT MT 103 message for $10,000 or more outside Canada or an incoming SWIFT MT 103 message for $10,000 or more sent from outside Canada is: FINTRAC provides guidance on what information should be included in the report. If you are a financial entity, a money services business or a casino, you will have to report certain electronic funds transfers (EFTs) to FINTRAC. Shinfield said the way that it is structured today, you have two regulated entities involved in the transaction and the money is going across the border. All batch header records are to be fixed in length as specified in the format descriptions. Reporting entities are required to complete reports about certain transactions and property and submit them to FINTRAC. For more information about FINTRAC enrolment, contact us as explained in section 7. For additional information about this as well as timeframes, means of reporting, EFTs in foreign currency and other requirements associated with EFTs, consult Guideline 8: Submitting Electronic Funds Transfer Reports to FINTRAC. in two or more transfers of less than $10,000 (that total $10,000 or more) if your employee or senior officer knows they were made within 24 consecutive hours of each other by or on behalf of the same individual or entity (24-hour rule). These are instructions sent electronically for the transfer of $10,000 or more outside Canada at the request of a cli… You send outgoing EFTs. Credit Cards Shinfield spoke about the changes at a recent ACAMS conference in Toronto and wrote about the subject in a legal blog. “It’s no longer optional because the traveler will require all that information to be contained. Prepaid Payment Products and Accounts more FINTRAC The definition of an EFT has changed with the amended regulations and reads as such: An electronic funds transfer means the transmission by any electronic, magnetic or optical means of instructions for the transfer of funds, including a transmission of instructions that is initiated and finally received by the same person or entity. However, the requirements in respect of EFTs still apply to MSBs. There are some specific exclusions from the definition of an EFT that are particularly relevant given the changes made to the reporting requirements … This reporting requirement is only applicable to you if you are a financial entity or a money services business and you send or receive EFTs made at the request of a client by transmission of a SWIFT MT 103 message, as a SWIFT member, through the SWIFT network. The Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) is Canada's financial intelligence unit. An international EFT is defined in the Regulations as "an electronic funds transfer other than for the transfer of funds within Canada." (January 1997) 2. Reporting entities must file EFTs no later than five working days after the day the transfer occurred. In addition, transmittals of funds governed by the Electronic Funds Transfer Act (Reg E) or made through ATM or point-of-sale systems are not subject to this rule. Simplifying Compliance and Fraud Prevention, FINTRAC Changes Reporting Requirements for EFTs. 3. ... Large International Electronic Funds Transfer Report: An Electronic Funds Transfer Report (EFT) must be filed with FINTRAC for each money transfer involving a large international EFT requested by (or on behalf of) the same person of $10,000 or more, in a single transaction or aggregate in 24 hours. So that’s a huge change for organizations other than banks in the reporting.”, The definition of an EFT used to include only cross border transfers, now they’ve taken that out and given a definition of an international EFT which is basically an EFT that goes into Canada, Shinfield explained. These are instructions sent electronically for transfer of $10,000 or more from outside Canada at the request of a client in the following manner: In the 2013 Budget, the Government of Canada announced measures to strengthen the ability of the Canada Revenue Agency (CRA) to combat international aggressive tax avoidance and international tax evasion. FINTRAC recently issued a new guidance to explain the changes which are being implemented. • FINTRAC Interpretation Notices • Compliance Assessment Report Reporting • Suspicious transactions You must report where there are reasonable grounds to suspect that a transaction or an attempted transaction is related to the commission or attempted commission of a money laundering offence or a terrorist activity financing offence. SWIFT means the Society for Worldwide Interbank Financial Telecommunication. What FINTRAC says about SWIFT EFTs Similarly, you do not have to make an EFT report if you receive a transfer from an individual or an entity in Canada, even if the original sender was outside Canada. Shinfield said if you have a money service business that deals with the bank or foreign exchange company and they send the instruction to the bank and it includes the name and the address of the originator, it’s reportable by the bank. The same reporting requirement applies to non-SWIFT electronic fund transfers. Financial Transactions and Reports Analysis Centre, Ministerial directives and transaction restrictions, Foreign branches, subsidiaries and affiliates, Register your money services business (MSB), Financial transactions that must be reported, Reporting EFTs under the Shared Reporting Process, Additional information about electronic funds transfers, https://www.canada.ca/en/revenue-agency/programs/about-canada-revenue-agency-cra/compliance/electronic-funds-transfer-reporting.html, Alternative to large cash transaction reports. Acquisition by Tier1 Opens New Opportunities. The number followed by a slash, '/' must be followed by the ISO country code, a slash, '/', the issuer of the number, a slash, '/' and the Customer Identification Number. On this basis, REs will need to completely restructure their respective EFT reporting processes. Initially, FINTRAC required only reports of international … The EFT reporting requirements for the CRA and FINTRAC are identical. This reporting covers EFTs that are the transmission of instructions for a transfer of funds through any electronic, magnetic or optical device, telephone instrument or computer other than SWIFT MT 103 messages described above. If you are a financial entity, an MSB or a casino, you must report to FINTRAC for the following transactions: CaseWare RCM’s Alessa can help your institution keep track of EFTs and report suspicious transactions to regulators. FINTRAC will provide you with an identifier number to include in your reports. Its mandate is to facilitate the detection, prevention and deterrence of money laundering and the financing of terrorist activities, while ensuring the … reporting requirements. For more information please contact us. Section 5 provides detailed formatting requirements for each report (i.e., incoming or outgoing SWIFT EFT). Corporate information reporting requirements are in place at the federal and provincial levels; however, there are differences between jurisdictions in requirements related to the collection, disclosure, and access to this information. Under the current requirements, the entities that are the last to touch an outgoing EFT and the first to touch an incoming EFT are required to report to FINTRAC. As a reporting entity, you have to be enrolled with FINTRAC's electronic reporting system to report electronically. If you are a financial entity, a money services business or a casino, you have to send a report to FINTRAC for the following transactions: 1. “So you have really got to look at your requirements that apply to your sector because they are different depending on if it’s international EFT or an EFT.”. According to FINTRAC, if you are a financial entity, a money services business (MSB) or a casino, you will have to report certain electronic funds transfers (EFTs). So basically the last person to touch an EFT that leaves the country has to report it.”. The number followed by a slash, '/' must be followed by the ISO country code, a slash, '/' and the National Identity Number. Shinfield said if a bank touches that money but then it’s going onward to an MSB or a foreign exchange dealer or some other party who reports EFT’s, it’s the first to touch that reports it and that’s provided they get the beneficiary name, and event issued address. There is also a new requirement that requires reporting entities to verify the identity of beneficiaries of EFTs of $1,000 or more, which is a net new requirement, she said. FINTRAC web reporting (F2R) You are accessing a Government of Canada information system. Alessa is Growing! The number followed by a slash, '/' must be followed by the Date of Birth in the YYYYMMDD format. The number followed by a slash, '/' is followed by information completing the Identifier provided in subfield 1 (Party Identifier) used with the (Code)(Identifier) format. If you are a financial entity, a money services business or a casino, you have to send a report to FINTRAC for the following transactions: There is an exception to the 24-hour rule explained above for an EFT with more than one beneficiary. When you send or receive instructions to transfer $10,000 CAD or more internationally, either in a single transaction or in multiple transactions, within a 24-hour period you must submit a report within 5 business days. On this basis, REs will need to completely restructure their respective EFT reporting processes. The EFT Report and instructions and LCTR Form and instructions are available on the FINTRAC website at: www.fintrac.gc.ca Client and /or third party information, record keeping requirements mention above applied to EFT or LCTR transactions. Credit Cards The requirements to report large cash transactions and EFTs are currently triggered where the transaction is for more than C$10,000 or where there have been smaller transactions over a 24-hour period that total C$10,000 or more that are conducted by, or on behalf of, the same person or entity. • MSBs and FSMBs, along with other financial entities, are now required to verify the identity of a beneficiary of EFTs of $1,000 or more (in addition to the identity of the initiator or remitter). if you are an individual, you know the transfers were made within 24 consecutive hours of each other by or on behalf of the same individual or entity. In less than 6 months, the balance of the amendments to the Proceeds of Crime (Money Laundering) and Terrorist Financing Act will come into effect: most notably impacting virtual currency dealers and those engaged in sending and receiving electronic fund transfers (EFT). Financial transaction reports are critical to FINTRAC’s ability to develop and disseminate financial intelligence. What are the "Travel" rule's requirements? It is a co-operative owned by the international banking community that operates a global data processing system for the transmission of financial messages. Under the revised regulations, the … According to FINTRAC’s 2015-2016 Annual Report, financial transaction reporting has increased by 63 percent over the past five years, with the Centre receiving nearly 24 million reports in the past fiscal year alone. Please note that as of January 1st, 2015, all EFT reporting will be done through a Shared Reporting Process that allows reporting of EFTs simultaneously to both FINTRAC and the CRA. For more information about FINTRAC enrolment, contact us as explained in section 7. As of March 31, 2016, there were approximately 212 million reports containing personal informati… If you receive the following SWIFT message: You should provide the aforementioned message to FINTRAC in the following format: Your reporting obligations regarding EFTs also include sending or receiving EFTs by any means, as explained in the following. Please space-fill the remainder of the tag. A casino disbursement report must be submitted to FINTRAC by a casino when it makes a disbursement of $10,000 or more in the course of a single transaction, or upon making two or more disbursements totalling $10,000 or more within 24 consecutive hours on behalf of the same individual or entity. This report must contain, among other things, the following information on the client ordering the payment of the EFT (i.e., tag :50:) referred to in Schedules 2 and 3 of the PCMLTF Regulations: Although the Society for Worldwide Interbank Financial Telecommunication (SWIFT) allows its members to choose between three options to fill out tag :50:, i.e., options A, F and K, only options F and K do provide the information that is mandatory for these reports. Important note specific to Electronic Funds Transfer (EFT) reporting: This user agreement contains the terms and conditions under which you can use FINTRAC's web reporting system for electronic reporting of transactions as required under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act.. A structured transaction is a series of smaller transactions, which are broken up to avoid the $10,000 reporting requirements for the Bank Secrecy Act (BSA). You receive incoming EFTs. The physical batch size cannot exceed 30 megabytes, uncompressed. “So all the reporting really falls to the financial institution as the last touch and the first to touch that’s gone. For information on those topics, visit. All rights reserved. Home She also fully explained the changes in a recent ACAMS podcast. / Blog / FINTRAC Changes Reporting Requirements for EFTs. This report is not limited to cash. The reporting requirements now apply in regards to both outgoing EFTs to the RE that initiates the EFT, and incoming EFTs to the RE that is the final recipient of the EFT. Alessa is a CaseWare RCM Product. For entities that are required to report EFTs, any amount valued at CAD 10,000 or more that is sent out of Canada or received from outside of Canada on behalf of a customer is reportable to the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) within 5 business days. These are instructions sent electronically for the transfer of $10,000 or more outside Canada at the request of a client in the following manner: in two or more transfers of less than $10,000 (that total $10,000 or more) in the following 24-hour rule situations: if you are an entity, your employee or senior officer knows the transfers were made within 24 consecutive hours of each other by or on behalf of the same individual or entity; or. in two or more transfers of less than $10,000 (that total $10,000 or more) if your employee or senior officer knows they were made within 24 consecutive hours of each other by or on behalf of the same individual or entity (24-hour rule). 3.2 When do you have to report electronic funds transfers? One of those measures called for the reporting of international electronic funds transfers (EFTs) of $10,000 or more to the CRA, for use in the administration of the, FINTRAC is not involved in the use, disclosure or retention of the EFTRs sent to the CRA. FINTRAC ID Requirements: Amendments for Ascertaining Identity * The transition period to adopt the new methods to verify the identity of individuals has been extended until January 23, 2018 . The number followed by a slash, '/' must be followed by an Address Line (Address Line can be used to provide for example, street name and number, or building name). Guideline 8A: Submitting non-SWIFT Electronic Funds Transfer Reports to FINTRAC … FINTRAC will continue to manage the existing reporting channels and provide user … Be followed by a slash, '/ ' must be followed by a slash, '/ ' must followed! Enrolled with FINTRAC 's electronic fintrac eft reporting requirements system to report electronically information about FINTRAC enrolment, us. Are required to complete reports about certain transactions and reports Analysis Centre of Canada ( )... Format descriptions “ so all the reporting requirements for EFTs reporting enrolment a new guidance to the... 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fintrac eft reporting requirements 2021