Enforcement trends are going sky high for FMSBs 📈
In the last 6 months, FINTRAC has taken a harder line than ever on the enforcement of regulated entities, and in particular against Foreign MSBs (FMSBs) that have routinely made volumes of non-compliance errors - with total penalties issued to the tune of over $197 million dollars. This all since July 2025…😱
Here are some key facts on violations that are getting FMSBs into hot water:
🚫 No Registration with FINTRAC.
This is non-negotiable. FINTRAC requires any entity that is considered an MSB in Canada (including foreign and virtual currency operators), must be registered with FINTRAC.
🚫 Multiple Violations and the “Per-Instance” Strategy.
FINTRAC is actively leveraging their powers to penalize each infraction SEPARATELY and issue cumulative penalties. Meaning, for businesses like virtual currency operators that have high transaction volumes, penalties can really add up if non-compliance is rampant. For example, in the case of Cryptomus (fined nearly $177 million), over 1,000 STR violations were found - and each violation was penalized individually…Yikes. This per-instance style enforcement paired with potential new administrative penalties of up to 40X more (as tabled in proposed Bill C-12), could have entities seeing even higher record penalties.
If you would like to learn more about proposed Bill-C12, read our article on this topic here.
🚫 Ministerial Directive Violations.
As part of anticipated shifts in legislation and the global AML FATF audit, to help the perception of increased security of our borders and illicit activities, tougher ministerial directives on sanctioned countries are now a reality and the enforcement against non-compliance is a big focus for FINTRAC.
Canada is a nuanced market and you need experts that know the intricacies of the local regulations and laws to help. We have assisted hundreds of MSBs with their compliance and we would love to support yours. Reach out to us for a free consult today contactus@theamlshop.ca