Record keeping requirements for departments and agents of the Crown that sell or redeem money orders
This guidance on record keeping is applicable to departments and agents of the Crown that are subject to the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA) and its associated Regulations.
This guidance will only describe your record keeping requirements if you are a department or agent of the Crown that sells or redeems money orders or other similar negotiable instruments in the course of providing financial services to the public.
If you are a department or an agent of the Crown that accepts deposit liabilities, your requirements can be found on the financial entities sector page.
If you are a department or agent of the Crown that sells precious metals in the amount of $10,000 or more in a single transaction, your requirements can be found on the dealers in precious metals and stones sector page.
In order to comply with your record keeping requirements you must keep records in a manner in which they can be provided to FINTRAC within 30 days upon request. These records may also be requested through a judicial order by law enforcement to support an investigation of money laundering or terrorist activity financing. A record (or a copy) may be kept in a machine-readable or electronic form, so long as a paper copy can easily be produced.
Employees who keep records for you are not required to keep them after the end of their employment with you. The same is true for individuals in a contractual relationship with you, after the end of that contractual relationship. This means that you have to obtain and keep the records that were kept for you by any employee or contractor before the end of that individual's employment or contract with you.
There may be situations where you are required to keep records for purposes other than your requirements under the PCMLTFA. For example, a federal or provincial regulator for your sector may require you to keep records in addition to those described in this guidance. If this is the case, you must still meet the requirements described in this guidance. For example, the retention period for your records can be longer than what is described, but it cannot be shorter.
Please note that as a department or agent of the Crown that sells or redeems money orders, you have record keeping requirements in addition to those included in this guidance. These additional requirements are detailed in the following Know your client guidance documents:
- Methods to identify individuals and confirm the existence of entities
- Business relationship requirements
- Ongoing monitoring requirements
- Third party determination requirements
As a department or agent of the Crown that sells or redeems money orders, you must keep the following records:
- Suspicious transaction report records
- Large cash transaction records
- Client information records
- Records of transactions of $3,000 or more
- If you receive $3,000 or more for the issuance of traveller's cheques, money orders or other similar negotiable instruments from a person or entity
- If you cash a money order of $3,000 or more
- Reasonable measures records
**Note: Exceptions to your record keeping requirements are listed in the last section of this guidance.
**Note: When recording the nature of the principal business or occupation of a client, you must be as descriptive as possible in order to be able to determine whether a transaction or activity is consistent with what would be expected for that client. For example, in the case of a person who is a manager, the occupation recorded should reflect the area of management, such as “hotel reservations manager” or “retail clothing store manager.” The same is true when recording the nature of the principal business of an entity. For example, in the case of an entity in the field of sales, the nature of the principal business should specify the type of sales, such as “pharmaceutical sales” or “retail sales”.
1. Suspicious transaction report records
If you submit a suspicious transaction report (STR) to FINTRAC, you have to keep a copy of it. This includes STRs for completed and attempted transactions.
Retention: You must keep an STR for at least five years from the date the report was submitted.
2. Large cash transaction records
You must keep a record of every large cash transaction. A large cash transaction occurs when you receive $10,000 or more in cash from a client in a single transaction. A large cash transaction also occurs when there are multiple cash transactions of less than $10,000 each that total $10,000 or more within a 24-hour period, when you know they are conducted by, or on behalf of, the same individual or entity.
When a client conducts a large cash transaction, your record must indicate the receipt of an amount of $10,000 or more in cash, along with the following:
- the name, date of birth and address of the individual from whom you received the cash, and the nature of their principal business or occupation;
- the amount and currency of the cash received;
- the date of the transaction;
- the purpose and details of the transaction, including:
- the type of transaction (for example, the cash was used to purchase a money order, etc.); and
- whether any other individuals or entities were involved in the transaction;
- how the cash was received (for example, in person, by mail, by armoured car, or any other way); and
- if an account was affected by the transaction, include:
- the account number and type of account;
- the full name of the account holder; and
- the currency in which the transactions are conducted in the account.
Retention: You must keep large cash transaction records for at least five years from the date the record was created.
3. Client information records
You must create a client information record for an ongoing business relationship with a client.
If the client is an individual, you must record their name, date of birth and address, as well as the nature of their principal business or occupation. If the client is an entity, you must record its name and address, as well as the nature of its principal business.
If the client is a corporation, you also need to keep a copy of the part of the official corporate records that contains any provision relating to the power to bind the corporation regarding the transaction. This could be a certificate of incumbency, the articles of incorporation or the bylaws of the corporation that set out the officers duly authorized to sign on the behalf of the corporation, such as the president, treasurer, vice-president, comptroller, etc.
If there are changes to the articles or bylaws that relate to the power to bind the corporation to the transaction and these changes were in effect at the time, then the board resolution stating the change would be included in this type of record.
Retention: You must keep client information records for five years from the day the last business transaction was conducted.
4. Records of transactions of $3,000 or more
a. If you receive $3,000 or more for the issuance of money orders or other similar negotiable instruments, you must record:
- the date it was received;
- the amount received and whether the amount was received in cash, cheques, traveller’s cheques, money orders or other similar negotiable instruments; and
- the name, address and date of birth of the individual who gave you the amount.
b. If you cash a money order of $3,000 or more you must record:
- the name, address and date of birth of the individual cashing the money order;
- the name of the issuer of the money order.
Retention: You must keep a record of transactions of $3,000 or more for at least five years from the date the record was created.
5. Reasonable measures records
The term “reasonable measures” refers to activities you are expected to undertake in order to meet certain obligations. The PCMLTFA and associated Regulations explicitly state when you must take reasonable measures to meet an obligation.
As of June 17, 2017, the Proceeds of Crime (Money Laundering) and Terrorist Financing Regulations have been changed to require that a record be kept when reasonable measures were taken, but were unsuccessful. A reasonable measure is unsuccessful when you do not obtain a response, such as a yes or no, and you are unable to make a conclusive determination. Refer to section 67.3 of the Regulations for every activity where you are required to keep records when reasonable measures were unsuccessful.
When reasonable measures are unsuccessful, you must record the following information:
- the measures taken;
- the date on which each measure was taken; and
- the reasons why the measures were unsuccessful.
You must outline the reasonable measures that you take in your compliance policies and procedures. This can form part of your unsuccessful reasonable measures record, or you could document, on a case-by-case basis, the measure taken in each record for unsuccessful reasonable measures.
For example, if you ask a client if they are conducting a large cash transaction on behalf of a third party and they refuse to answer your record should indicate that you asked, the date you asked and the fact that the client refused to answer yes or no.
Should you take a measure that is not included in your policies and procedures, you would have to include details of that measure taken in your record of unsuccessful reasonable measures.
Retention: You must keep records of your unsuccessful reasonable measures for at least five years following the date they were created.
Exceptions to record keeping requirements
If you are required to keep a record about information that is readily available in other records that you have kept, you do not have to record the same information again. This means that if you keep the required information and can produce it during a FINTRAC examination you do not need to create a new record to meet your obligations.
You do not have to keep a client information record, or records of transaction of $3,000 or more when issuing or cashing money orders or other similar negotiable instruments, if the transaction is for a public body or a very large corporation. The same is true regarding a subsidiary of either of those entities, if the financial statements of the subsidiary are consolidated with those of the public body or very large corporation.
You do not have to keep a large cash transaction record if the cash is received from a financial entity or a public body.
- Date Modified: