Canada urged to clamp down on money laundering

6 October 2006

A group of Canadian legislators has urged the country's government to tighten money laundering rules following a review which uncovered a number of loop holes in existing legislation.

The Canadian Senate's banking, trade and commerce committee wants lawyers, jewelers and operators of white label cash machines, which are unconnected to banks, to be brought within the jurisdiction of the law in order to clamp down on financial transactions which are used to fund criminal activities such as terrorism.

Under the current Proceeds of Crime (Money Laundering) and Terrorist Financing Act, lawyers are exempt from rules which require accountants, bankers and other professionals to report any suspicions transactions carried out by their clients, a situation that the committee wants to change.

It also wants Canada's government to develop a registration system for companies that provide money services such as pay-day loans and check-cashing facilities to deter money launderers from targeting them and is calling for a closer examination of the way that new financial services such as internet banking and white label ATMs are being used by criminals.

Under proposals suggested by legislators, jewelers would also be required to report suspicious transactions over C$10,000 to the appropriate authorities.

Releasing an interim report, the chair of the Senate's banking committee, Senator Jerry Grafstein, said. “The criminal mind is an agile and creative one so legislators have to constantly review and update our laws to keep pace."

"Soon after we close one loophole, they find a new way to manipulate the system," he warned.

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