Licensee duties to combat financial crime
Published January 18, 2023
Life insurance companies, brokers and agents must fulfill specific obligations and duties as required by the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA)
and associated regulations to help combat money laundering and terrorist activity financing in Canada.
Under the PCMLTFA
and associated regulations, a life insurance broker or agent is a person or entity that is authorized under provincial legislation to carry on the business of arranging contracts for life insurance.
The Financial Transactions and Reports Analysis Centre of Canada (FINTRAC)
outlines the duties of a life insurance broker and agent, this includes developing and maintaining a compliance program, a "know your client" program, reporting transactions, and maintaining records. On June 1, 2021, regulatory amendments came into force which created or changed obligations for all reporting entities and includes guidance that clients’ identities be verified under specific conditions or transactions.
Certain financial entities
, including life insurance brokers or agents that offer loans or prepaid payment products to the public, or maintain related loan or prepaid payment product accounts have additional financial entity obligations.
The measures are designed to protect consumers from criminal activity that could harm Canadians and the general public. It is the responsibility of Insurance Council of BC licence holders to follow FINTRAC's guidance in accordance with the Proceeds of Crime (Money Laundering) and Terrorist Financing Act
and to become acquainted with the FINTRAC guidelines in order to maintain a high professional standard.
's website to learn more about the requirements and guidance.