Foreign money service businesses (MSBs) must follow the same compliance requirements as local MSBs. This means you must have an excellent Canadian compliance team to ensure your business is not violating legal regulations.
Of course, fulfilling your Canadian compliance obligations from outside of Canada may be difficult. That is why you should consider investing in a fractional AML compliance team like us.
We can help you meet FINTRAC and Bank of Canada regulations by allowing your MSB to have a compliance presence in the nation. Learn more about it below.
The Problems Your Foreign MSB Can Face For Not Having A Canadian Compliance Team
- No Real Office In Canada Makes Banking Tough
Getting a bank to work with you is highly important for an MSB in Canada. But if you want to partner with a solid bank for the long term, you must show them you have a reliable Canadian compliance team.
Having a presence within Canada is necessary because:
- Banks in Canada are very careful about compliance risk because many MSBs are now targeting foreign clients. So they want to be assured that your company has a significant footprint in the nation.
- Working with banks becomes a breeze if you have a Canadian compliance presence. That's because bank personnel favour the expertise of local teams as they have better knowledge about FINTRAC's compliance program requirements.
- Operational Restrictions And More Fee Charges
MSBs get a green light from bank account providers when they've got a compliance team in Canada.Â
If you have a foreign team, banks in Canada may flag your MSB as a high-risk entity, causing you to face drawbacks like:
- Greater transaction fees
- Operational delays
- Denial of MSB banking services
- Regulatory Risks: FINTRAC & The Bank of Canada Want You Around
Here in Canada, the rules surrounding FINTRAC MSB registration are extensive. The main goal of different compliance programs is to prevent money laundering and terrorist financing.
If you don't have an MSB compliance team in Canada, you can run into serious trouble.
● FINTRAC and Bank of Canada rules need MSBs to manage Canadian compliance obligations within the country. If your team's abroad, they might not keep up with these organization’s regulatory updates.
â—Ź Running things without a solid Canadian compliance team to back your MSB will cause trouble eventually. Your FINTRAC MSB licence may also get revoked.
This is especially true if your MSB faces an audit, but you don’t have a compliance officer in Canada to meet FINTRAC officers.
- Audits, Licence Revocation, And More
Many overseas groups are establishing MSBs in Canada but they're lacking a legit Canadian setup. The main reason behind this is that they mainly help people outside Canada.
Remember Canadian banks and regulatory authorities watch your business carefully. They consistently conduct compliance checks to ensure MSBs are following their requirements.
If your MSB is not playing by the Canadian MSB compliance obligations, your business may face an audit. Banks also stop partnering with MSBs that don’t have a Canadian physical presence.
The worst thing that can happen is permanent licence revocation if you don’t maintain FINTRAC compliance for foreign companies.
The Solution: Hiring a Canadian-Based Fractional AML Compliance Team
If you don't have a Canadian compliance team, no need to panic. We've got your back with our fractional AML compliance team. Our firm can help your MSB enjoy a presence in Canada without breaking the bank.
What Is Fractional AML Compliance?
A fractional AML compliance service allows your MSB to have a dedicated and experienced Canadian compliance team at a fraction of the cost of hiring a full-time, in-house team.Â
Our Canadian-based compliance professionals will help you meet all regulatory requirements while ensuring that banks view your MSB as a legitimate, low-risk entity.
Advantages Of Using Our Fractional AML Service
- Regulatory Compliance & Risk Mitigation
A fractional AML compliance team like ours can help you avoid MSB licence cancellation issues. Our experts are locals who have lived all their lives in Canada.
They know the FINTRAC compliance requirements like the back of their hands. This means your MSB should never face Canadian compliance issues.
From ensuring your business meets all FINTRAC MSB registration requirements to providing real-time adjustments as fintech laws change, we’ve got your back.
- Improved Banking Relationships
We will act as your registered compliance officers to:
- Offer credibility to banks
- Eradicate business legitimacy concerns among regulators
- Develop a framework that allows your MSB Canada to become bankable
Our expert fractional AML compliance team performs thorough due diligence for every client. We use our foresight and experience to predict issues that may arise with regulatory authorities.
Rennoco’s team also prepares solutions for predicted issues to reduce rejection chances, making it easy for you to partner with a bank.
- Cost-Effective & Scalable Solution
Hiring an in-house compliance team for your foreign MSB can be expensive. It may also not be worth the money because FINTRAC compliance requirements want your MSB to have a Canadian compliance officer.
No matter how good your foreign compliance team members are, your MSB will always stay at a disadvantage. You can get rid of the drawback by opting for our service.
Our fractional AML compliance team is scalable and affordable for small to large businesses. The best thing is that our service will ensure you meet Canadian compliance obligations.
- Prevention of Licence Revocation
Registering for a FINTRAC MSB licence without a Canadian fractional AML compliance team is like buying a car without an engine. It simply won’t work.
Banks will refuse to partner with you and FINTRAC may reject your MSB registration request. They may also revoke your already approved licence if they find your MSB Canada non-compliant.
You can avoid all these things by taking just one step – hiring our fractional AML compliance team.
FAQs
What Are AML Compliance Requirements And Canadian Compliance Obligations?
AML compliance requirements make it necessary for MSBs to report suspicious transactions and perform due diligence carefully.Â
Canadian compliance obligations take these requirements to the next level by requiring MSBs to obtain a FINTRAC licence, follow AML regulations, and hire a local compliance team.
What Will Happen If Your MSB Is Non-Compliant?
If your MSB is non-compliant FINTRAC may revoke your licence. They may also impose a fine for violating their AML compliance requirements and other obligations.
What Are The Key Elements Of A Fractional AML Service?
A fractional AML service appoints an experienced compliance officer with a dedicated team to your MSB.Â
They establish a Canadian physical presence, ensure your business meets AML regulations, and develop a comprehensive compliance policy for you.
Secure Your MSB’s Future With Rennoco Fintech’s Fractional AML Compliance Service
Hiring a compliance team outside of Canada to fulfill Canadian MSB compliance obligations is a high-risk strategy. It can lead to banking difficulties, regulatory issues, and potential licence revocation.Â
Instead, secure your business with a trusted, Canadian-based fractional AML compliance team. At our firm, we specialize in helping MSBs meet FINTRAC requirements, secure stable banking relationships, and maintain compliance to avoid regulatory issues.
Don’t leave your business vulnerable, contact us today to learn how our fractional AML compliance services can offer the stability your MSB needs to succeed in Canada.
