Add a bookmark to get started

3 January 20247 minute read

Canada’s AML regime: End of year review 2023‎

Canada’s anti-money laundering and anti-terrorism financing regime has seen a rapid evolution with the introduction of numerous regulatory and legislative amendments since 2022. This past year has been no exception, with the Federal Government continuing to introduce significant changes to the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTF Act) and its associated regulations (PCMLTF Regulations), as well as changes to other federal legislation, aimed at countering the risk of money laundering and terrorist financing. 

Provided below is a high-level summary of the important changes introduced in 2023 and insights on what to expect in the year ahead.

New businesses added to the regime

In 2023, the Federal Government added additional businesses to the PCMLTF Regulations, specifically:

  • Non-financial institution mortgage lenders: Mortgage administrators, brokers and lenders are now considered Reporting Entities. The amendments to the PCMLTF Regulations included mortgage lenders as a new of category of persons and entities engaged in a prescribed business, profession or activity for the purposes of section 5(i) of the PCMLTF Act. The inclusion of mortgage lenders was a response to concerns about the risk of money laundering activities in the mortgage lending industry.
  • Armoured car businesses: Businesses that transport currency, money orders, traveler’s cheques, or negotiable instruments (i.e. armoured cars), will be subject to various regulatory requirements that are applicable to money services businesses.

In its new Guidance, FINTRAC noted that regulations applicable to armoured car businesses will come into force on July 1, 2024, while the regulations applicable to the mortgage lending sector are set to come into force on October 11, 2024.

For additional information and a more in-depth assessment of these regulatory changes please review our prior legal updates about the amendments and the FINTRAC Guidance.

Proposed changes to the PCMLTF Act

In the 2023 Federal Budget, the Federal Government announced its intention to introduce legislative amendments to the PCMLTF Act. The amendments were aimed to strengthen the investigative, enforcement, and information sharing tools of Canada's AML regime.

In the Budget, the Federal Government noted that it would conduct a review of the PCMLTF Act. As part of that review, the Federal Government proposed sweeping changes to PCMLTF Act and Regulations. The proposed changes were published in a Consultation Paper from the Department of Finance. The Consultation Paper provided a review of the current legislative and regulatory framework applicable to Canada’s AML regime and ways to enhance the regime. Notably, the Consultation Paper made recommendations to expand the scope of the AML regime in the following ways:

  • Expanding or altering the scope of regulated conduct for existing reporting entities like accountants, casinos, and dealers of precious metals;
  • Expanding the scope of the current AML framework in the real estate sector;
  • Expanding the scope of the current AML framework to new sectors, like:
    • High-value goods, such as automobiles, yachts, aircraft, art, and other luxury products;‎
    • Large cash transactions that occur between businesses not currently covered under the PCMLTF Act;
    • Company service providers that provide incorporation services to the public;
    • White label automated teller machines that provide cash withdrawal services;
    • Factoring companies that supply short-term loans or upfront payment for the accounts receivable of another business to address their cash-flow needs; and
    • Federal financial Crown corporations that are engaged in financial activities (such as the Bank of Canada).

New financial crime agency

In the Consultation Paper, the Federal Government also unveiled the next steps towards establishing the Canada Financial Crimes Agency (CFCA), a new federal agency responsible for investigating and enforcing complex financial crimes. The Federal Government is working with stakeholders and the public to determine the structure of the CFCA, as well as, the activities and functions of the agency including, what tools, powers, and programs should be provided to the CFCA.

You can read more about the CFCA in our legal updates posted here and here.

Provincial AML legislation

In June of 2022, the Cullen Commission of Inquiry into Money Laundering in British Columbia published its final Report (Cullen Report). The Cullen Report identified the money laundering risks associated with Money Services Businesses (MSBs) and recommended a regulatory scheme to govern MSBs operating in British Columbia, in addition to the existing oversight of FINTRAC.

The British Columbia Money Services Businesses Act received royal assent in May of 2023. Pursuant to the Act, the British Columbia Financial Services Authority regulates MSBs operating in British Columbia under the supervision of a Superintendent of MSBs. Unlike the PCMLTF Act, this Act will be a gatekeeping regime that aims to prevent “bad actors” from providing money business services.

British Columbia is now the second province in Canada, after Quebec, to introduce provincial legislation that governs the operation and business of MSBs.

Federal Beneficial Ownership Registry

In furtherance of efforts to combat the risk of money laundering and terrorism financing, the Federal Government also introduced changes to implement a free and publicly accessible beneficial ownership registry of all corporations incorporated under the Canada Business Corporations Act (CBCA).

Pursuant to the amendments, which received royal assent in November of 2023, corporations incorporated under the CBCA or subject to the CBCA are required to maintain and file a register of ‎individuals with significant control (being an individual who, jointly or on their own, directs or controls, directly or indirectly, 25 percent of the shares of a ‎given corporation). CBCA corporations are required to record in and register information that would enable one to identify who owns, controls, or directs the ‎shares of a given corporation. ‎

For additional insight about the implications of this change, you can read our prior legal update on the Federal Beneficial Ownership Registry. 

Retail Payment Activities Act

The Retail Payments Activities Act (RPAA), which became law in 2022, is federal legislation that regulates retail Payment Service Providers (PSPs). The RPAA is regulated by the Bank of Canada.

In November of 2023, the Federal Government published the regulations under the RPAA and also announced the dates the RPAA will come into effect.

While the RPAA establishes a regulatory framework to supervise PSPs in Canada, it also has some key overlaps with Canada’s AML Regime. For instance, FINTRAC and the Bank of Canada will share certain information related to registered PSPs. The RPAA requires the Bank of Canada to provide FINTRAC with certain information collected from PSPs seeking to register. If a PSP’s application to register is refused or revoked, the RPAA provides that the Bank of Canada must notify FINTRAC. Likewise, FINTRAC is required to disclose certain information about the compliance of registered entities to the Bank of Canada.

For businesses subject to PCMLTF Act and RPAA, there is uncertainty about their potentially overlapping obligations under both legislative schemes.

More details about the RPAA and its associated regulation are found in our prior legal updates here and here.


We expect that 2024 will bring further changes to Canada’s AML regime. The rapidly changing AML Regime coupled with potentially overlapping requirements of the RPAA, will undoubtedly present challenges to organizations, who are trying to determine their obligations under the new legislation and amendments.

Please feel free to reach out to any member of our team with any questions relating to these developments.