New Canadian Federal laws and regulations designed to prevent money laundering* and anti-terrorist financing went into effect June 23, 2008.
Its now required that all Canadian Realtors obtain proof of identity from all parties in any Real Estate transaction, even if one of the parties is not represented by a Real Estate agent. Realtors must also track the source of funds received during the course of a real estate transaction, such as the deposit. If the client is a corporation, corporate documentation and the names of the corporation directors must be provided and the corporation must disclose if a third party is involved in the transaction.
Some of you have already had to provide this information when purchasing a home - others are yet to have to go through the process-but I'm sure we can all appreciate why these measures have been taken.
"Real estate agents have had legal obligations under the federal government's push to prevent criminal activity and terrorism since 2001, when Canada's first comprehensive laws to combat money laundering and terrorist financing were introduced," says RAHB President, Ann Cosens. "Real estate agents were required to report only suspicious transactions or transactions involving more than $10,000 in cash."
These new regulations are part of federal legislation (Bill C-25) passed in 2007 that requires a number of industries, including real estate, to do more to help stop money laundering and terrorist financing. The regulations are enforced by the federal agency known as the Financial Transactions and Reports Analysis Centre of Canada, or FINTRAC.
As part of the new rules, Realtors are required to keep all identification and the receipt of funds report on file for at least five years and provide it to FINTRAC. Realtors are also required to complete a report on the receipt of all funds received during a real estate transaction.
Also, under the new FINTRAC regulations, real estate agents dealing with clients they never meet must also verify identification. The broker office involved can do this with a service agreement with an agent or mandatary in the area where the client is located. The agent or mandatary must then meet the client, verify the identification of the client, and provide the information to the broker office handling the real estate transaction.
To comply with the new regulation, Iguess it will make Real Estate agents will need to get more acquainted with their clients. Which is a good thing right? :-)
* Definition of "Money Laundering" according to Wikipedia.....
Money laundering is the practice of engaging in financial transactions in order to conceal the identity, source, and/or destination of money, and is a main operation of the underground economy.
In the past, the term "money laundering" was applied only to financial transactions related to organized crime. Today its definition is often expanded by government regulators (such as the United States Office of the Comptroller of the Currency) to encompass any financial transaction which generates an asset or a value as the result of an illegal act, which may involve actions such as tax evasion or false accounting. As a result, the illegal activity of money laundering is now recognized as potentially practiced by individuals, small and large businesses, corrupt officials, members of organized crime (such as drug dealers or the Mafia), and even corrupt states, through a complex network of shell companies and trusts based in offshore tax havens. A few examples of money laundering are smurfing or kiting.
The increasing complexity of financial crime, the increasing recognized value of so-called "financial intelligence" (FININT) in combating transnational crime and terrorism, and the speculated impact of capital extracted from the legitimate economy has led to an increased prominence of money laundering in political, economic, and legal debate.
******************************* 
If you or someone you know is thinking of buying or selling property in Chilliwack or the Fraser Valley Area of B.C., please give Liz Moras, Associate Broker & REALTOR® of Re/Max Nyda Realty, a call! Call Liz at 604-799-0459 or e-mail at lizmoras@shaw.ca. Be sure to check out Liz's website www.lizmoras.com and blog at www.lizmoras.activerain.com.
Copyright © 2008 By Liz Moras, All Rights Reserved. *Fintrac-New Law Requires Real Estate Agents to Collect and Verify ID of Buyers and Sellers*
 |
|
|
At Keller Williams the agents are partners – they share in the profits, they have a say in the decision-making and they are empowered to build their businesses to the highest possible level.
Pet Peeve....So What do You Think About People Who are Always Late?????
Hurricane Ike and our A/R Members from Texas
Remembering 9/11 - A Canadian - American Tribute
How Do You Choose Which Blog You're Going to Read?
Circle of Wagons - Circle of Friends
Grandparents Day - September 7 - A Tribute
The Vedder-Chilliwack River - The Most Popular River in the Lower Mainland - Chilliwack, B.C.
Canada Set for Third Election in Four Years!
Beautiful Cultus Lake - A Perfect Family Getaway - Chilliwack, B.C.
ActiveRain Corp. is not responsible for the accuracy of the site's content (which is written by members of the ActiveRain Real Estate Network) and does not endorse the views of the real estate agents, mortgage brokers, and others listed here.
Powered by the ActiveRain Real Estate Network
© 2009 ActiveRain Corp. All Rights Reserved
WoW! That is incredible.
Not a bad idea. Good way to qualify these clients further, and eliminate those lookers...
I had a seasoned Realtor tell me he loves it. The more mandatory forms from the government the better...it gets them warmed up for the signing the documents that may resist. By the time they get to those they are in auto sign mode!
Interesting take on it.
Dear Invisible - Yep times they are a changing....hmmm :-)
Liz,
Various essential security matters, from airports to public buildings, make our lives more difficult. Thanks to all the troublemakers out there.
Sherry - I'm not sure its meant to screen buyers but rather its required that Buyers and Sellers fill out this forms when they're under contract. :-)
Kye - well thats an interesting thought - there really are soo many forms to fill out these days - remember the 2 page contract of 20 years ago............?
Steven - it certainly made life more complicated!_
Sorry Liz...I don't. I was only 13 and my mom wouldn't let me work at the local gas station never mind be a Realtor ;-). Too bad though. Eventually ended up at the gas station...and a Realtor.
Kye.......oooops did I date myself or what? lol
I don't mind the extra forms - the task is minimal, taking only about 5 extra minutes in the process. However, I wish they ironed out all the "bugs" before implementing this rule; the training (and I use that term lightly) was abismal, and contributed to the negative reaction some showed towards the new forms.
Interesting - here at closing the title company does that, but we haven't had to do that when writing the offer.
Scott - well thats the first time I've heard someone say that........and gee actually thats a good attitude to have......i was just in the midst of writing a post about whining and complaining...........and i thought while reading your comment...........get with the program girl......forms are to help and protect both us and our clients! Thanks for that!(i didn't even know there was training for that!)
Coeur........I guess they want to get the scoop earlier............we used to wait to do title searches on closing - now we do them at Listing AND at Closing!
Thank you Liz - I really believe that these forms are a positive thing - they protect us. As for the training - NSAR (our R.E. Association) issued a powerpoint training session (about 20 minutes long) for our management to review with everyone in the brokerage. It was a nice attempt, but fell short somewhat...fuelled by the negativity of many of the training recipients about the "amount of work". this was. Let's face it, it is essentially writing down the clients full name, occupation, their drivers licence number and it's expiry. Even if I was too lazy to handle this, why complain? It's mandatory.
I shared someone else's take earlier. I am again going to piggyback on someone else's take, however this time it aligns with my feelings.
Scott...for the win!
You're so right Scott - its true it is a waste of energy complaining so much of the time........and focusing on the positive aspects of why we have to do what we have to do............slows down the graying process!
Kye - that what its all about here, sometimes we share, sometimes we piggyback, sometime we pioneer........:-)
I don't mind it especially when I'm dealing with a client I have never met before. I do have a problem when my Broker wants to report one of my best (and very well known) clients to Fintrac as a suspicious person because of his name is 'different'. He's asian and lives in Vancouver... how different is that?
Uta - hmm thats a little weird ......