FINTRAC (Financial Transactions and Reports Analysis Centre of Canada) broadened its regulatory scope to include financing and leasing entities, beginning April 1, 2025. This means dealerships that provide financing or leasing on their vehicles must implement a comprehensive Anti-Money Laundering (AML) and Anti-Terrorist Financing (ATF) compliance program to meet the requirements of the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA).
To avoid costly repercussions, it’s important to understand who’s affected, what’s at stake, and the steps needed to build a compliance program. Our experienced AML/ATF professionals can help you navigate your obligations and support your dealership in developing and implementing a robust compliance program.
Who’s affected?
- Dealerships financing or leasing passenger vehicles in Canada
- Entities leasing or financing property valued at $100,000 or more (excluding real estate)
Note: Passenger vehicles are defined as motor vehicles designed to carry up to 10 individuals, excluding specific exempt vehicles like ambulances or utility trucks.
Penalties for non-compliance
Failure to comply can result in:
- Financial penalties
- Reputational damage
- Increased regulatory scrutiny
Key components of an effective AML/ATF program
- Identify an individual responsible for the AML/ATF program and holds the role of Chief Anti-Money Laundering Officer (CAMLO).
- Establish clear policies and procedures for identifying and preventing money laundering and terrorist financing activities within your dealership.
- Evaluate and document areas of potential exposure to money laundering and terrorist financing risks in your operations.
- Ensure accurate record maintenance and timely reporting of transactions to FINTRAC.
- Provide ongoing education to staff on AML/ATF requirements and how to spot red flags.
- Continuous review and monitoring of transactions to identify unusual or high-risk activity.
- Select an independent party to perform a review of your AML/ATF program at least every two years.
We can help
If you need additional guidance on how this will impact your dealership or support building an AML compliance program, contact your local advisor or reach out to us here. We look forward to working with and building a long-term relationship with you and your business!
Disclaimer
The information contained herein is general in nature and is based on proposals that are subject to change. It is not, and should not be construed as, accounting, legal, or tax advice or an opinion provided by Doane Grant Thornton LLP to the reader. This material may not be applicable to, or suitable for, specific circumstances or needs and may require consideration of other factors not described herein.
