CREA/FINTRAC Identification Verification Requirements June 23, 2008 Legislation
By Warren McNeil
I recently sat in on a meeting with our office. The discussion was regarding new legislation that went into effect on June 23 that requires all realtors to gather more information about clients. This is mandatory legislation is a requirement put into effect by FINTRAC and CREA at the federal level. Here is a quote from our portal website at http://www.realtorlink.ca/content/fintrac/
"CREA recommends that REALTORS® advise clients of the FINTRAC requirements BEFORE any real estate documents are signed. This is to avoid members being involved in a buyer agency or listing agreement, only to discover the client later refuses to provide the identification information now required by law. A REALTOR® who continues to represent a client who refuses to provide identification information is in non-compliance of the law."
Who is FINTRAC:
"The Financial Transactions and Reports Analysis Centre of Canada, or FINTRAC, is Canada's financial intelligence unit, a specialized agency created to collect, analyze and disclose financial information and intelligence on suspected money laundering and terrorist activities financing . Created in July 2000, the Centre is an integral part of our country's engagement in the global fight against money laundering and the financing of terrorist activities."
How does this new legislation effect our clients?
We are now required by law to collect more information about clients during a real estate sales transaction. When a client purchases real estate, we have to keep a client information record and we need to take all steps to verify the client.
The type of information that needs to be collected is as follows:
3. Date of birth
4. occupation or principal business
5. The type of ID that will be used to verify the information (Photocopy not necessary. Just have to record the number. Licence number, birth certificate number)
See identification requirements for more information: http://www.realtorlink.ca/content/fintrac/identification_requirements.htm
We also need to include how the record was created. In-person, Not physically present, identified using a mandatary
Identification that FINTRAC will not be use is (Ontario only):
1. Heatlh cards not allowed
2. SIN cards are not allowed
Obviously this is designed to thwart money laundering and other illegal activities involving large amounts of money. As long as people understand what this legislation is all about then there won't be any problems.
Unabridged version of the new legislation. Please read: http://www.realtorlink.ca/content/fintrac/
FINTRAC main website: http://www.fintrac-canafe.gc.ca
CREA main website: http://www.crea.ca
Thanks for reading!