Anti-Money Laundering

New Anti-Money Laundering Obligations for the Financing and Leasing Sector

 

On March 26, 2025, the Federal Government published the final regulations covering financing and leasing entities under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA). The regulations will enter into force on April 1, 2025.

Covered entities (i.e., ‘reporting entities’)

A financing or leasing entity is engaged in a business or profession for the purposes of paragraph 5(j) of the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA) when it is financing or leasing:

  • property, other than real property or immovables, for business purposes;
  • passenger vehicles in Canada; or
  • property, other than real property or immovables, that is valued at $100,000 or more.

Both direct and indirect financing and leasing arrangements are captured under the regulations.

Entry into force

Covered entities are not expected to fully comply by April 1, 2025. However, you should start working on your compliance program and related processes to ensure you are fully compliant by April 1, 2026.  

Additionally, the provisions regarding discrepancy reporting (i.e., notifying authorities when there is a material discrepancy between information on a company's records and public registry) will come into force on October 1, 2025.

Amendments relating to (voluntary) information sharing, which will permit private-to-private information sharing under Canada’s AML/ATF legislative framework, are now in force. 

Obligations under the PCMLTFA

Financing and leasing entities will be required to establish compliance programs and fulfill record-keeping, due diligence, and transaction-reporting requirements. 

  • Establish and maintain a compliance program 
  • Enhanced KYC requirements: Client identification, ongoing monitoring of accounts, high-risk clients, beneficial ownership, third-party determination
  • Transaction reporting
  • Discrepancy reporting
  • Record keeping  

Available resources

With the guidance of our AML Working Group, the CFLA is working to develop resources for the members in the coming weeks and months to help with implementation. This will include a series of webinars and best practice guides. 

A first webinar on what’s expected under the new rules and where to start with implementation will be held on April 10, at 1:00 p.m. EST, in collaboration with our partners at KPMG.

FINTRAC will also publish its preliminary sector-specific guidance within the next month. To ensure that our sector’s specific needs are addressed, the CFLA is collecting technical questions that we will aggregate and send to FINTRAC. If you have any technical questions regarding implantation (e.g., what’s covered, what needs to be verified, etc.), please email them to us. 

The CFLA will also join the Advisory Committee on Money Laundering and Terrorist Financing (ACMLTF) to ensure our industry’s AML interests are well represented. 

 If you have any other questions or concerns, please contact Marcel Buerkler, Director of Advocacy & Industry Intelligence.

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