FINTRAC Partners with U.S. Federal Banking Agencies to Bolster Anti-Money Laundering Efforts

Canada’s anti-money laundering agency, the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC), has formalized a partnership with three key U.S. federal banking agencies. The agency announced in a LinkedIn post that it had signed a memorandum of understanding (MOU) with the Office of the Comptroller of the Currency, the Federal Deposit Insurance Corporation (FDIC), and the Federal Reserve Board.

This agreement will facilitate the exchange of information between the Canadian and U.S. agencies, aiming to strengthen compliance with anti-money laundering (AML) and anti-terrorist financing (ATF) regulations for banks operating across borders.

According to FINTRAC’s post, “The cooperation and communication between the authorities will allow for each agency to effectively respond to emerging risks, enhance risk identification prevention and detection, in an effort to mitigate ML/TF risk exposure.”

The partnership represents a heightened effort by FINTRAC to tackle money laundering and terrorist financing risks, particularly in light of the Canadian government’s recent expansion of its national security powers.

In a show of its commitment to enforcement, FINTRAC earlier this year issued its largest penalty to date, imposing nearly C$9.2 million (US$6.54 million) on TD Bank for failing to comply with AML regulations.

The agency also made history in December 2023 by penalizing two of Canada’s largest financial institutions, the Royal Bank of Canada (RBC) and the Canadian Imperial Bank of Commerce (CIBC), for AML violations. The fines, totaling approximately C$9 million, were levied for infractions including the failure to submit suspicious transaction reports.

This MOU is expected to enhance the ability of Canadian and U.S. regulators to address emerging threats in the financial sector, ensuring stricter compliance with laws designed to combat money laundering and terrorist financing.

By fLEXI tEAM