What Is FINTRAC?
FINTRAC is an acronym for the Financial Transactions and Reports Analysis Centre of Canada, the financial intelligence unit that monitors monetary transactions to identify and prevent illegal activities such as money laundering and financing of terrorist organizations. The center reports to the Minister of Finance, who in turn is accountable to Parliament. FINTRAC is headquartered in Ottawa and has offices in Montreal, Toronto and Vancouver.
Sarah Paquet is the director and chief executive officer of FINTRAC. For the 2019–20 budget year, the agency planned to spend C$53 million and employ 367 full-time equivalent staff.
- FINTRAC monitors financial transactions to identify and prevent money laundering, terrorist funding and other illegal activities.
- The financial intelligence unit reviews more than 25 million transaction reports every year.
- In 2018–19 reporting period, it disclosed 2,276 cases of actionable intelligence in support of investigations into money laundering and terrorist funding.
How FINTRAC Works
FINTRAC was founded in 2000. It monitors financial transaction reports for suspicious behavior and to protect the integrity and security of Canada's financial transactions. As part of its operations, it collects personal data from individuals and organizations. The agency's tasks include:
- Receiving financial transaction reports
- Protecting the information under its control
- Uncovering patterns of money laundering and terrorist financing
- Complying with all relevant regulations, such as the Privacy Act
- Providing information from its findings to the public
FINTRAC operates separately from other legal authorities, but is authorized to share the information it discovers with them. For example, if FINTRAC identifies a financial criminal (or suspect), law enforcement agencies would need to be notified in order to detain or arrest the individual. FINTRAC is under the purview of Canada's Minister of Finance and was established as part of the Proceeds of Crime (Money Laundering) and Terrorist Financing Act.
As part of a government organization, FINTRAC must report its findings according to the Access to Information Act, which requires government information to be available to the public.
Since 2002, FINTRAC has been a member of the Egmont Group of Financial Intelligence Units, a global network of financial analysis organizations that collaborate to combat money laundering and terrorist financing on an international level. Other prominent Egmont Group members include the Financial Crimes Enforcement Network (FinCEN) in the United States and the National Crime Agency (NCA) in the U.K.
The number disclosures of actionable financial intelligence FINTRAC made in the 2018–19 reporting period.
Special Considerations for FINTRAC
Since FINTRAC collects individuals' personal data, it is required to adhere to regulations under Canada's Privacy Act, which specifies that personal information can only be used in relation to the purpose for which it was collected. Additionally, individuals have the right to access their own information and make any necessary corrections. FINTRAC must protect this personal information from unauthorized disclosure.
Audits in 2013 and 2009 by the Office of the Privacy Commissioner of Canada (OPC) revealed that FINTRAC collected information not relevant to its initiatives. Following the 2009 audit, FINTRAC pledged to reduce the information it held to an absolute minimum. The subsequent 2013 audit revealed that this reduction did not occur. The OPC and other critics spoke out against this unnecessary hoarding of information, pressuring FINTRAC to adopt quicker solutions to reducing the data it gathers and maintains.