Bill C-2: Major changes to Canada’s Anti-Money Laundering regime

On June 3, the federal government introduced Bill C-2, the Strong Borders Act, which proposes significant amendments to Canada’s Anti-Money Laundering (AML) regime through updates to the Proceeds of Crime (Money Laundering) and Terrorist Financing Act. The bill aims to strengthen AML enforcement, improve regulatory oversight, and enhance information sharing across institutions. 

One of the central proposals under Bill C-2 is the introduction of tougher penalties for non-compliance. Civil penalties would rise dramatically, with individuals facing fines of up to $4 million and entities up to $20 million. Where multiple offences are involved, cumulative penalties could reach the greater of $4 million or 3% of global income for individuals, and the greater of $20 million or 3% of global revenue for entities. Criminal penalties are also set to increase substantially.

The bill also targets large and potentially suspicious cash transactions. It would prohibit cash payments or donations over $10,000 and restrict third-party cash deposits, with exceptions to be prescribed and communicated at a later date. In addition, the use of anonymous or fictitious names on accounts would be prohibited outright.

Bill C-2 would require all businesses regulated for AML purposes to register with the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC). FINTRAC’s role would be further enhanced through a proposed amendment to the Office of the Superintendent of Financial Institutions Act, which would appoint the director of FINTRAC as a member of the Financial Institutions Supervisory Committee (FISC). The director would also have the ability to exchange information with other FISC members.

To improve information flow between public and private sectors, the bill proposes related amendments to the Personal Information Protection and Electronic Documents Act. These changes are designed to support the Integrated Money Laundering Intelligence Partnership, a collaboration between financial institutions and law enforcement aimed at detecting and deterring money laundering activity.

We will continue to closely monitor this legislation’s progress through the House of Commons and provide updates.

The authors would like to thank Thea Gribilas, summer student, for her contribution to preparing this legal update.