From FINTRAC’s report, it is evident that money laundering
is occurring in the industry. Securities firms, both large and small,
need to be vigilant and aware that money laundering schemes
in their industry will not be the stereotypical “bringing in large
amounts of cash”. As money laundering evolves, securities
firms need to look hard at their clients and the activity they are
undertaking and be aware of new opportunities that money
launderers can take advantage of in the industry.
Based on FINTRAC’s report, we recommend that
• Review this report as it shares what other firms have identified
and reported as suspicious.
• Re-evaluate their risk assessment and where there is potential
exposure to money laundering risks, update their controls and
procedures to mitigate those risks. For example, whether
your firm has the ability to identify payments into the same
account through different cheques/bank drafts.
• Review the firm’s list of red flags and consider updating
training to include the red flags/cases identified in the report.
This may include frequent transfers between accounts or
transactions performed by a non-resident.
A full copy of the report is available on FINTRAC’s website:
Wherever you are, we’ve got you covered.
About Grant Thornton in Canada
Grant Thornton LLP is a leading Canadian accounting and advisory
firm providing audit, tax and advisory services to private and public
organizations. Together with the Quebec firm Raymond Chabot Grant
Thornton LLP, Grant Thornton in Canada has approximately 4,000 people
in offices across Canada. Grant Thornton LLP is a Canadian member of
Grant Thornton International Ltd, whose member firms operate in close to
100 countries worldwide.
About Grant Thornton International Ltd
Grant Thornton Canada is a member firm of Grant Thornton International
Ltd (Grant Thornton International). References to “Grant Thornton” are to
the brand under which the Grant Thornton member firms operate and refer
to one or more member firms, as the context requires. Grant Thornton
International and the member firms are not a worldwide partnership.
Services are delivered independently by member firms, which are not
responsible for the services or activities of one another. Grant Thornton
International does not provide services to clients.
For more information contact:
The Ultimate Designated Person (UDP) category of
registration is a curiosity.
The UDP was traditionally viewed as a name that had to
be filled in to complete a firm registration - figurehead with no
genuine functional role. However, over time, and especially
since the introduction of NI 31-103, the role of UDP, began to
A UDP’s responsibility is formally set out under Part 5.1 of
National Instrument 31-103, and is explained in the Companion
Policy as follows:
The UDP is responsible for promoting a culture of compliance
and overseeing the effectiveness of the firm’s compliance system.
They do not have to be involved in the day to day management
of the compliance group. There are no specific education or
experience requirements for the UDP. However, they are subject
to the proficiency principle in section 3. 4.
To understand this regulatory hieroglyphic, one has to first
consider the key condition to qualify as UDP. Part 11.2 explains
that the UDP must be the individual who functionally serves as
CEO of the registerable business.
In the novel “The Great Gatsby”, F. Scott Fitzgerald describes
the main character, Jay Gatsby, as follows:
“If personality is an unbroken series of successful
gestures, then there was something gorgeous about
By Vipool Desai, CA CFA
President, ARA Compliance Support