The Federal Government’s 2024 Budget (Budget 2024) contains measures against financial crime. Budget 2024 acknowledges that financial crime can range from terrorist financing, corruption, money laundering, fraud, tax evasion, and sanctions evasion. “These crimes have real-world implications, often enabling other criminal behaviour,” says the budget document. “Financial, crime also undermines the fairness and transparency that are so essential to our economy.”
Anti-Money Laundering and Anti-Terrorist Financing
To combat money laundering, terrorist financing, and sanctions evasion, Budget 2024 contains measures against money laundering, terrorist financing, and sanctions evasion. The government intends to introduce legislative amendments to the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA), the Criminal Code the Income Tax Act, and the Excise Tax Act.
- Proposed amendments to the PCMLTFA:
- Enhance the ability of reporting entities under the PCMLTFA to share information to detect and deter money laundering, terrorist financing, and sanctions evasion, while maintaining privacy protections for personal information, including an oversight role for the Office of the Privacy Commissioner;
- Permit the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) to disclose financial intelligence to provincial and territorial civil forfeiture offices to support efforts to seize property linked to unlawful activity; and, Immigration, Refugees and Citizenship Canada to strengthen the integrity of Canada’s citizenship process;
- Closing a loophole regarding anti-money laundering and anti-terrorist financing regulatory obligations to cover factoring companies, cheque cashing businesses, and leasing and finance companies, and level the playing field across businesses providing financial services;
- Allow FINTRAC to publicize more information around violations of obligations under the PCMLTFA when issuing administrative monetary penalties to strengthen transparency and compliance; and,
- Make technical amendments to close loopholes and correct inconsistencies.
- Proposed amendments to the Criminal Code:
- Allow courts to issue an order to require a financial institution to keep an account open to assist in the investigation of a suspected criminal offence; and,
- Allow courts to issue a repeating production order to authorize law enforcement to obtain ongoing, specified information on activity in an account or multiple accounts connected to a person of interest in a criminal investigation.
- Proposed amendments to the Income Tax Act and Excise Tax Act:
- Ensure Canada Revenue Agency officials who carry out criminal investigations are authorized to seek general warrants through court applications, thereby modernizing and simplifying evidence-gathering processes and helping to fight tax evasion and other financial crimes.
Canada Financial Crimes Agency
- The Department of Finance will receive $1.7 million over 2024-25 to develop the legal framework of the Canada Financial Crimes Agency (CFCA) which will focus on money laundering charges, prosecutions, and convictions, and the seizure of criminal assets.
Fighting Trade-Based Fraud and Money Laundering
- Budget 2024 announced $29.9 million over five years, starting in 2024-25, with $5.1 million in remaining amortization and $4.2 million ongoing, for the Canada Border Services Agency to support the implementation of its enhancements under the PCMLTFA to combat financial crime and strengthen efforts to combat international financial crime with our allies. These enhancements would combat trade-based financial crime and create a Trade Transparency Unit.
Budget 2024 is available for download from the website of the Government of Canada.
For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606.
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