Fintrac penalizes bank for lapses in money-laundering oversight, sparking appeal and scrutiny
Canada’s financial intelligence agency, Fintrac, has imposed a $2.46m administrative penalty on Exchange Bank of Canada.
According to BNN Bloomberg, the penalty stems from non-compliance with money-laundering regulations.
Fintrac determined that the bank failed to submit suspicious transaction reports despite reasonable grounds, did not conduct ongoing monitoring of business relationships, and neglected to report cash transactions of $10,000 or more.
The review, covering conduct from late 2022 to April 2024, revealed that the bank’s compliance program lacked sufficient maturity.
In response to the decision, Exchange Bank of Canada has filed a notice of appeal.
“Canada’s Anti-Money Laundering and Anti-Terrorist Financing Regime is in place to protect the safety of Canadians and the security of Canada’s economy,” Sarah Paquet, director, and chief executive of Fintrac.
“FINTRAC will continue to work with businesses to help them understand and comply with their obligations under the Act. We will also be firm in ensuring that businesses continue to do their part and we will take appropriate actions when they are needed.”
The issue highlights growing scrutiny of money-laundering practices following revelations that TD Bank Group’s oversight failures in the US enabled criminals to launder hundreds of millions of dollars from illegal drug sales.
