Quick Overview
On April 11th, 2019, FINTRAC published an Operational Alert issued in part with the Canadian Anti-Fraud Centre. The information provided related to laundering the proceeds of romance scams and mass marketing fraud. The publication provided an explanation of what constitutes a romance scam, some common indicators that may be present and transaction patterns or flow of funds that may suggest fraud.
What Does it Mean?
The suspicious indicators provided by FINTRAC list circumstances or activities that might signal potential cases of individuals caught in a romance scam or the subject of a mass marketing fraud. This does not mean that if one or more of the indicators are present that the transaction is definitely suspicious and must be reported to FINTRAC. It is meant to ensure that you are aware of the potential that suspicious activity may be taking place. In that context, if you are involved in customer’s transactions, whether on the front lines or in back office, you must be aware of the indicators in the alert. If you do encounter a transaction that may be considered unusual, you should attempt to collect additional information that will aid in the Compliance Officer’s decision to report it or clearly document why it was not considered suspicious. Where the Compliance Officer makes the decision to report the transaction to FINTRAC as suspicious, be sure to include “Project CHAMELEON” or “#CHAMELEON” in Part G—Description of suspicious activity in the STR. This will help to facilitate FINTRAC’s disclosure process.
What Now?
In order to ensure familiarity for anyone who interacts with customers and their transactions, the list of FINTRAC’s indicators should be included in your ongoing AML compliance training program. Furthermore, the indicators should also be included in your procedure manuals, allowing easy access to the information. Finally, the indicators should be incorporated into your Risk Assessment documentation. Specifically, when determining customer risk and the controls used to effectively mitigate potential risks.
We’ve made it easier for you to integrate this content into your program by putting the indicators in a Word document for you.
Need a Hand?
Outlier has taken the list of indicators provided by FINTRAC and formatted them into an easy to use Microsoft Word document, which can be found here. This should allow companies to easily update their documentation and ensure they are sufficiently monitoring for potential instances of romance scams or mass marketing fraud. If you aren’t sure what to do with this information and would like some assistance, please feel free to contact us.