Costly FINTRAC Penalties Are Avoidable: What MSBs Can Learn From a Recent Compliance Failure
FINTRAC’s latest administrative monetary penalty serves as another reminder that Canadian money services businesses cannot afford weak compliance programs. The issues identified were not obscure technicalities; they were foundational AML/ATF requirements that every MSB is expected to meet.
For MSBs, these failures highlight a simple truth: compliance shortcuts cost far more than doing things right the first time.
Below, we break down where things went wrong. Working with Platino Consulting, an experienced AML advisory partner, ensures your program is both audit-ready and risk-appropriate year-round.
1. Outdated or Incomplete Policies & Procedures
FINTRAC identified gaps in several core areas, including:
Lack of ongoing monitoring of business relationships
Incorrect guidance on suspicious transaction report (STR) timelines
No documented process for terrorist property reporting
Missing requirements for politically exposed persons (PEPs) and heads of international organizations (HIOs)
These are essential program elements under the PCMLTFA. When policies are incomplete, outdated, or misaligned with legislation, staff lack direction, and examiners view this as a red flag for broader systemic weaknesses.
At Platino Consulting, our compliance specialists develop tailored, FINTRAC-aligned policies based on your business model, products, delivery channels, and risks. You get clear, practical procedures your team can rely on, and that stand up during an examination.
2. Poorly Documented or Generic Risk Assessment
The MSB’s risk assessment was found to be generic, outdated, and not reflective of its actual operations. It also failed to apply enhanced mitigation measures for high-risk areas.
A risk assessment is the backbone of your AML program. If it is not specific to your business, it is not compliant.
Platino Consulting builds dynamic, prescriptive risk assessments that:
Address your real risks across geography, clients, channels, and technology
Include clear scoring methodologies
Integrate enhanced risk mitigation measures
Remain current with operational changes and regulatory expectations
3. Inaccurate or Incomplete EFT and Large Cash Transaction Reports
FINTRAC identified multiple instances of reports missing essential data such as:
Date of birth
Beneficiary details
Accurate occupation
Complete addresses
Transaction time
Even a small number of inaccurate reports is considered a loss of financial intelligence, something FINTRAC takes seriously.
Platino Consulting provides reporting reviews, operational testing, and staff training to ensure all required information is captured and validated before submission.
4. Failure to Maintain Accurate MSB Registration Information
The examination found:
Undisclosed branch locations
Incorrect agent information
Inconsistencies on reported vs. actual services offered
Incorrect MSB registration details undermine FINTRAC’s ability to assess your risk and program complexity, making this a significant violation.
Platino Consulting ensures your MSB registration is correct, updated, and fully aligned with your business operations and service offerings. We also monitor changes that require ongoing updates.
What This Case Teaches All MSBs
FINTRAC does not impose penalties based on the size of the business, it imposes penalties based on the seriousness of compliance failures. And the failures in this case were preventable. When MSBs try to manage compliance without expert support or rely on outdated templates, the result is almost always the same: gaps, inconsistencies, and expensive regulatory consequences.
Why MSBs Choose Platino Consulting
MSBs work with us because we provide:
Tailored AML Program Development
No generic templates, your program is built specifically for your operations and FINTRAC expectations.
Experienced AML Advisors
We’ve supported MSBs through FINTRAC examinations, remediation projects, operational testing, and reporting compliance.
Ongoing Program Maintenance
Regulatory requirements evolve. Your compliance practices must evolve with them.
Independent Effectiveness Reviews
We identify gaps before FINTRAC does.
Training That Actually Works
Practical, scenario-based training that ensures staff know exactly what to do in real-world situations.
If you're ready to strengthen your AML program, protect your business, and ensure you’re audit-ready year-round, our team is here to help. Contact us for a consultation and let’s discuss how Platino Consulting can give you and your stakeholders peace of mind.
