FINTRAC Client Identification & Verification: Timing and Methods for Mortgage Brokers, Realtors and MSBs
One of the pillars of any AML program is client identification and verification. For FINTRAC-regulated firms, the when and the how of verification are sector-specific and carry operational consequences: verify too late and you risk non-compliance; verify too early or incorrectly and you risk disrupting legitimate business.
Sector timing matters — why it’s not one-size-fits-all
FINTRAC sets out sectoral guidance because the nature of transactions differs between industries. Mortgage brokers, for example, often act as intermediaries where funds and settlement timing dictate a particular verification approach, whereas MSBs that transmit funds may face different customer-facing touchpoints for identity checks. FINTRAC’s mortgage guidance and other sector pages explain when identity must be verified for persons and entities.
Methods to verify identity — documentary and non-documentary
FINTRAC’s methods guidance specifies acceptable verification approaches. Documentary methods (government-issued ID, corporate filings) are typical, but FINTRAC also recognizes non-documentary or “digital” methods, for example, credit file checks, trusted electronic ID verification, or corroboration through independent third-party sources — provided the methods are reliable and risk-appropriate. Importantly, these methods must be applied consistently with your risk assessment and documented in your client file.
Mortgage brokers: timing, credit-file method and practical workflow
FINTRAC’s mortgage guidance specifically allows the credit-file method as an accepted way to verify identity, which is practical for mortgage brokers who routinely obtain credit reports. The mortgage guidance sets out when to identify clients (e.g., before funds are advanced or when a mortgage is requested) and how to record verification steps. For brokers, this means embedding credit-file checks into the origination workflow and keeping dated evidence in the client file.
MSBs and real estate: frontline verification and business-process mapping
For MSBs, identity verification often happens at the onboarding stage or before a transaction meets a sector-trigger (e.g., cross-border remittance). For real estate professionals, identification must be tied to stages in the sale or purchase process that FINTRAC identifies as critical, for example, when a transaction reaches certain thresholds or when red flags appear. Mapping your customer journey, identifying exactly where KYC decisions are made, is a practical way to ensure compliance without interrupting business flow.
Digital ID, trust-but-verify, and risk-based flexibility
FINTRAC’s methods guidance permits modern verification technologies, but they must be reliable and proportionate to the risk. If you use a third-party electronic ID provider, maintain contracts and test results demonstrating accuracy. For higher-risk clients, supplement digital methods with documentary evidence and enhanced due diligence. Maintain written policies that explain which methods your firm uses and in which circumstances.
Practical checklist for front-line compliance
Create a short checklist for staff that captures: (1) the point in the customer journey where verification is required; (2) acceptable documents or methods to use; (3) how to record evidence and the retention period; (4) escalation steps for inconsistent or suspicious information. Keep the checklist integrated with your CRM or loan origination system so verification steps produce auditable records.
Verification obligations are implementable when approached as a business process problem rather than a legal puzzle. Map your customer journeys, select technology that meets your risk profile, and train staff to document the “what, when and why” of each verification decision. Reach out to Platino Consulting for support on your AML processes for mortgage brokerages, realtors and MSBs.
