FINTRAC Advisory Concerning Financial Transactions Related to High-Risk Countries Identified by FATF

On November 20, 2023, the Financial Transactions and Reports Analysis Centre (FINTRAC) issued an updated advisory (the “Advisory”) concerning financial transactions related to countries identified by the Financial Action Task Force (FATF) as high-risk jurisdictions and under increased monitoring.

Background

The Advisory follows two statements recently issued by the FATF:

• a statement on high-risk jurisdictions subject to a call for action, which identifies jurisdictions for which the FATF has called on countries to apply countermeasures or enhanced due diligence; and
• a statement on jurisdictions under increased monitoring, which identifies jurisdictions that have developed an action plan with the FATF to address deficiencies in their anti-money laundering and counter-terrorist financing strategies.

Takeaways from the Advisory

The Advisory focuses on key aspects of various FATF statements and notes FINTRAC expectations. The Advisory also references earlier statements issued by the FATF in respect of various matters concerning high-risk jurisdictions. See our November 2022 Update, March 2023 Update and our July 2023 Update relating to earlier advisories.

The Advisory references the following notable changes:

• Bulgaria is now subject to the FATF’s increased monitoring process and appears on the ‘grey list.’
• Albania, Cayman Islands, Jordan, and Panama are no longer subject to the FATF’s increased monitoring process.
• FINTRAC notes that reporting entities should consider the rapidly evolving situation in the Middle East in determining whether to file a suspicious transaction report where there are reasonable grounds to suspect the transactions or attempted transactions emanating from, or destined to, the Middle East are related to the commission or attempted commission of a money laundering offence or a terrorist activity financing offence.
  
  FINTRAC also reminds reporting entities of their obligation to submit a terrorist property report to FINTRAC without delay, once they have made a disclosure under the Criminal Code or the Regulations Implementing the United Nations Resolutions on the Suppression of Terrorism.

For further information concerning the matters referenced in the updated Advisory and what they might mean from a compliance perspective, please contact any member of our Financial Services Regulatory Group.