Your Guide to Canadian and Foreign MSB Registration
Are you starting a money services business in Canada? Or perhaps you are already running one and now considering the crucial step of obtaining a Canadian MSB license. Registering as a Money Services Business (MSB) with the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) is a legal requirement that helps prevent money laundering and terrorist financing activities.
Patrola Law is a reputable Canadian law firm with extensive experience helping businesses like yours navigate the intricate landscape of money services. We have assisted numerous Canadian and international businesses in securing their Canada MSB registration, and our team is well-versed in the intricacies of regulatory compliance.
What Businesses Need to Register with FINTRAC?
Pursuant to the PCMLTFA, you are required to have a Canada MSB (Money Services Business) Registration if your business provides any of the following services.
Services That Require MSB Registration
When Registration Applies
You will also require a Canada MSB registration if you hold a related permit or licence, are registered as someone offering the above services, or advertise (by any means) that you engage in those services. Registration is also required if you offer money transfer services in any amount, conduct foreign exchange over $1,000 in a single transaction, or issue or redeem money orders or traveller’s cheques over $1,000 in a single transaction with the same person or entity.
Who does not require registration? The PCMLTFA does not apply if you are simply acting as an agent for a money services business, or carrying out an MSB activity in the course of providing other services for which you are already a reporting entity.
Understanding Canadian MSB Regulations: FINTRAC and PCMLTFA
In Canada, businesses involved in foreign exchange, fund remittance, virtual currency and crowdfunding are required to register with FINTRAC under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA).
The PCMLTFA regulations aim to combat money laundering and terrorist financing by establishing a framework that ensures businesses follow strict compliance procedures. By registering with FINTRAC, you demonstrate your commitment to the highest standards of integrity and accountability in your financial transactions.
Compliance is not only a legal requirement but a vital step in safeguarding your business against potential risks, protecting you from legal liabilities and demonstrating your commitment to a safe and secure financial environment.
Non-Compliance and Consequences
Not adhering to the PCMLTFA and securing registration as an MSB in Canada can result in serious repercussions.
Failure to register with FINTRAC and comply with PCMLTFA regulations can result in severe consequences, including criminal penalties such as fines and imprisonment.
4 Easy Steps to Secure Your Canadian MSB License
Determine if you are an MSB
You can use the FINTRAC self-assessment tool to help you decide if you are a Money Services Business. If you are not sure, consult with our expert lawyers who specialize in MSB registration.
Gather the required information and documents
You will need to provide information about your business, such as:
- Legal name and address
- Business structure and ownership
- Contact details and authorized representative
- Services offered and locations
- Banking information and financial statements
- Compliance regime and policies
You will also need supporting documents that prove your identity:
- Proof of identity and address for the owners and directors
- Articles of incorporation or partnership agreement
- Business license or permit
- Audited financial statements or tax returns
Submit the registration and await confirmation
FINTRAC will review your application and send a confirmation letter within 30 days of receiving it. The letter contains your registration number, expiry date, and instructions on how to renew. You are obligated to renew your registration every two years.
Comply with the MSB regulations
Once registered, you must follow the rules and obligations that apply to MSBs in Canada, including reporting certain transactions, keeping records, verifying customer identity, implementing a compliance program, and undergoing audits.
Patrola Law has been recognized as a top business law firm for multiple consecutive years by Three Best Rated, and trusted by MSB and fintech founders in Canada and around the world.
Quick Turnaround, No Surprise Bills
At Patrola Law Corporation, we understand the importance of efficiency and cost-effectiveness. Our experienced team of lawyers and staff works diligently to complete your MSB registration within 2 to 4 weeks, or even sooner. We deliver exceptional service with no hidden fees or surprise bills, and provide transparent, competitive flat-fee quotes so you have clarity on the costs from the start.
What Clients Say About Us
Patrola Law helped us obtain MSB Registration in Canada with FINTRAC. They also provided the advice and help we needed to establish our MSB Compliance Program and continues to help us remain in good standing. We happily depend on Patrola Law Corporation as our cherished business partner.
Patrola Law Corporation not only demonstrated a profound understanding of the legal intricacies of my case but also exhibited a genuine commitment to my well-being throughout the entire process. They combine legal expertise with genuine care for their clients.
Patrola Law recently represented our company for the MSB Registration in Canada with FINTRAC. It has been a pleasure working with the team, with quick turnarounds, professional advice and great communication. There are no hidden costs, and we got all the services as expected.
Frequently Asked Questions
Businesses providing foreign exchange dealing, fund remittance or transfer, issuing or redeeming money orders or traveller's cheques, dealing in virtual currency, or crowdfunding platform services, and that have a place of business in Canada, must register with FINTRAC.
Our team typically completes MSB registration within 2 to 4 weeks, or even sooner, with transparent flat-fee pricing and no surprise bills.
You will need business details (legal name, structure and ownership, services and locations, banking information and compliance policies) plus supporting documents such as proof of identity for owners and directors, articles of incorporation, a business license, and financial statements.
Operating without registration can result in criminal charges, monetary fines, imprisonment, reputational damage, and business disruption including suspension of operations or frozen assets.
Foreign money services businesses that direct services at Canada can be captured as foreign MSBs. We assess your situation and handle the registration for both Canadian and foreign businesses.