AML Changes: MSBs, WLATMs, Real Estate

Summary#

This is a package of proposed regulations published in the Canada Gazette on July 6, 2024 that would change parts of Canada’s anti‑money‑laundering rules under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act. The changes would add new reporting and registration rules (for example, a sanctioned‑property report, stricter checks for money‑services businesses, new rules for white‑label ATMs, title insurers, and casinos) and are open for comment for 30 days after publication.

What it does#

• Creates a new sanctioned‑property report for submission to FINTRAC so firms must record and report property that is subject to sanctions (UN lists and Canadian sanctions laws).
  • Timing: the new rule would come into force 60 days after the Part II notice for UN sanctions and 8 months after Part II for the larger set of Canadian sanctions.
• Strengthens the money‑services‑business (MSB) registration framework.
  • Domestic MSBs would have to submit criminal record checks for their CEOs, presidents, directors and anyone controlling 20% or more, and obtain criminal checks for their agents.
  • Criminal checks must be no older than six months at registration, registration happens every two years, and certain records must be kept for five years.
• Brings white‑label ATM (WLATM) acquirers into the AML rules.
  • Acquirers who connect WLATMs to payment networks would need to register with FINTRAC, do identity checks, keep records (owner, cash source, transport method, settlement accounts), run compliance programs, and file suspicious‑transaction reports.
  • Intended start date: October 1, 2025 for these measures.
• Makes title insurers subject to AML rules and tightens what real‑estate agents must do.
  • Title insurers would have to run compliance programs, verify identities, keep records and report suspicious transactions.
  • Real‑estate representatives would have an explicit obligation to identify unrepresented parties and any third parties in a transaction and keep that information.
  • Title‑insurer rules are planned for October 1, 2025; the unrepresented‑party identification rule would take effect on publication in Part II.
• Changes casino reporting so casinos must state the ultimate beneficiary of disbursements over $10,000 and record that identity.
  • The identification/beneficiary change would take effect on publication in Part II.

Cost and timing highlights:

• The department estimated a present‑value compliance cost of about $16.6 million (rounded to $17 million) over 10 years, or about $2.4 million per year.
• Some measures (MSB rules, WLATM, title insurers) are timed for October 1, 2025; others come into force sooner as noted above.

Who's affected#

• Financial intelligence and regulator: FINTRAC (will receive new reports and supervise compliance).
• Banks, credit unions and other reporting organizations (about 25,604 reporting entities were counted in the analysis).
• Money‑services businesses: about 2,566 MSBs would face new registration and criminal‑check duties.
• WLATMs: about 5 acquirers and roughly 10,000 WLATM owners would be in scope for new rules.
• Title insurers: 4 title insurers (would become formal reporting entities).
• Real‑estate professionals and buyers: real‑estate agents/brokers/developers and about 44,351 corporate purchasers and 44,351 unrepresented parties were used in the cost estimates.
• Casinos and individuals receiving large payouts: 18 casinos and an estimated 15,000 individuals receiving disbursements for others.
• Small businesses in these sectors would bear a meaningful share of the estimated costs (the analysis estimated total costs to small businesses of $8,492,591 in present value, or about $13.52 per affected small business per year).

If any of the numbers above are unclear in the source, that uncertainty is reflected in the official cost sensitivity analysis.

Why it matters#

• Closing gaps flagged by international standards: several changes are meant to bring Canada in line with Financial Action Task Force (FATF) expectations and to prepare for Canada’s next FATF mutual evaluation in 2025–26.
• Better sanctions enforcement: the sanctioned‑property report is intended to make it harder to hide or move sanctioned assets through Canadian financial channels.
• Targeting known weak spots: regulators have repeatedly identified WLATMs, some parts of real estate, MSBs and casinos as vulnerable to money laundering. These measures try to make those sectors harder to misuse.
• Real‑world effects for consumers and businesses: some firms will need to add identity checks, keep more records and change IT and paperwork flows; there will be ongoing compliance costs and some one‑time setup costs. The government estimates non‑trivial sector‑level costs but also argues the measures protect the financial system and Canada’s international standing.
• It is a proposal, not yet law: these are proposed regulations published for comment. Final rules and exact start dates depend on further steps and the Part II publication.