Dangerous liaisons

Based on films involving accountants, it seems CAs are more dangerous to others than victims of crime on the job. Neither role is desirable. Maybe being thought of as simple number- crunchers lurking in the background is actually a good, and safe, cover.

Most CAs, forensic or otherwise, don’t become involved in files that could end with them hanging from a local landmark or proposing murder. But there are engagements that belie the tired cliché of an accountant’s life being enervating and boring. Some files are anything but routine and can, on occasion, place a CA in a dangerous predicament. If a case requires a CA to work in a city or country known for its violence or lawlessness, that obviously increases the potential for something untoward to occur.

Unless circumstances demand it, Boucher strongly advises against getting armed, an option few CAs are likely to consider. “If a threat is so serious you’re considering getting a gun perhaps you should reconsider the file,” he says. “If it feels that dicey it’s real simple: get away from there. Guns blazing is not a good thing.”

For more information, read the March 2012 CAmagazine article “Dangerous liaisons” by David Malamed, CA•IFA, a partner in forensic accounting at Grant Thornton LLP in Toronto.

FATF steps up the fight against money laundering and terrorist financing

The Financial Action Task Force (FATF), the global standard-setter in the fight against money laundering and terrorist financing, has revised its Recommendations after more than two years of efforts by member countries. The Recommendations are used by more than 180 governments to combat these crimes. The revisions, made with inputs from governments, the private sector and civil society, provide authorities with a stronger framework to act against criminals and address new threats to the international financial system.

The revised FATF Recommendations now fully integrate counter-terrorist financing measures with anti-money laundering controls, introduce new measures to counter the financing of the proliferation of weapons of mass destruction, and they will better address the laundering of the proceeds of corruption and tax crimes. They also strengthen the requirements for higher risk situations and allow countries to take a more targeted risk-based approach.

For more information, refer to the FATF webpage on “International Standards on Combating Money Laundering and the Financing of Terrorism & Proliferation” and read the press release and the latest 127-page publication on The FATF Recommendations (February 2012).

Cybercrime: Protecting Against the Growing Threat

In December 2011, PricewaterhouseCoopers (PwC) issued a report called Cybercrime: Protecting Against the Growing Threat. This global economic crime survey report is divided into two sections: 1) Cybercrime – its impact on organizations, their awareness of the crime and what they are doing to combat the risks; and 2) Fraud, the fraudster and the defrauded – the types of economic crime committed, how they are detected, who is committing them and what the repercussions are.


A total of 3,877 respondents from organizations in 78 countries responded to this sixth survey by highlighting the growing threat of cybercrime. Against a backdrop of data losses and theft, computer viruses and hacking, the survey looks at the significance and impact of this new type of economic crime and how it affects businesses worldwide. The key findings from the survey show that:

• Cybercrime now ranks as one of the top four economic crimes.
• Reputational damage resulting from cybercrime is the biggest fear for 40% of respondents.
• 40% of respondents don’t have the capability to detect and prevent cybercrime.
• 56% of respondents said the most serious fraud was an ‘inside job’.
• Senior Executives made up almost half of the respondents who didn’t know if their organization had suffered a fraud.

Highlights from FINTRAC’s Annual Report 2011

FINTRAC is producing more and better financial intelligence than at any time it its past. This year, a record 777 case disclosures were provided to law enforcement, other domestic partners and to foreign financial intelligence units.

Over the last three years, FINTRAC has produced 1,912 disclosures, reflecting a continuing rise in demand for our product. During fiscal 2010-2011, FINTRAC made 777 case disclosures, of which: 626 were related to suspected money laundering; 103 for suspected terrorist activity financing and/or threats to the security of Canada; and 48 were for both suspected money laundering and suspected terrorist activity financing and/or threats to the security of Canada.

FINTRAC's financial intelligence disclosures were provided to a variety of law enforcement and intelligence agencies and other partners:

• The RCMP (the primary recipient of our disclosures);
• The Canada Revenue Agency;
• Municipal police services;
• Foreign financial intelligence units;
• The Canada Border Services Agency;
• The Canadian Security Intelligence Service;
• Provincial police services.

(For more information, read the News Release, the Highlights and the FINTRAC Annual Report 2011.)

Consultation to Update Canada's Anti-Money Laundering and Anti-Terrorist Financing Regime

The Honourable Jim Flaherty, Minister of Finance, has launched a consultation aimed at updating Canada’s regime for combating money laundering and terrorist financing. The consultation paper, “Strengthening Canada’s Anti-Money Laundering and Anti‑Terrorist Financing Regime,” puts forward several proposals that may be considered for future changes to the Proceeds of Crime (Money Laundering) and Terrorist Financing Act.

The proposals in the paper are organized around the following key areas:

·       strengthening client due diligence standards;

·       closing gaps in Canada’s regime;

·       improving compliance, monitoring and enforcement;

·       strengthening information sharing in the regime;

·       introducing a list of potential countermeasures; and

·       updating reporting requirements.

The paper will also serve to inform the Parliamentary review of the Proceeds of Crime (Money Laundering) and Terrorist Financing Act that will be conducted in 2012 by the Standing Senate Committee on Banking, Trade and Commerce. The deadline for comments is March 1, 2012.

Trends in Canadian Suspicious Transaction Reporting (STR) Part II – October 2011

This report (Trends in Canadian Suspicious Transaction Reporting (STR) Part II – October 2011) is the second in a series of FINTRAC publications that are intended to provide strategic financial intelligence and feedback to reporting entities about suspicious transactions reports (STRs). The first FINTRAC report on Trends in Canadian Suspicious Transaction Reporting, released in May 2011, presented a preliminary analysis of STRs submitted to FINTRAC between 2001 and 2010, using geospatial and text mining techniques. That report was the first FINTRAC attempt to use the text mining technique and served as the foundation to the current more sophisticated methodology.

This Trends and Typologies report on STRs is a continuation of the first one, and consists of an enhanced automated analysis of English and French STRs submitted to FINTRAC from January 1st, 2007 to December 31st, 2010. It provides a greater focus on select topics related to money laundering and terrorist financing that are described by reporting entities in the Part G narrative of STRs. In order to keep providing feedback to reporting entities in relation to STRs and keep highlighting interesting trends as FINTRAC’s text mining capabilities develop in sophistication, it is our intention to keep producing this series of analytical publications.

There are several sections in this report. Part 1 provides a broad overview of the material introduced in the first report and addresses the new methodology used to analyze STRs in the current report. Part 2 describes the trends observed in the Part G narrative of STRs, by specific sector, and contains the report’s main findings. Part 3 provides a brief overview of the dominant themes related to reasons for suspicion in STRs across all sectors. Conclusions are offered in Part 4.

Consultation Paper on Proposed Amendments to the Proceeds Of Crime (Money Laundering) and Terrorist Financing Regulations on Ascertaining Identity

The Minister of Finance of the Government of Canada is proposing amendments to the Proceeds of Crime (Money Laundering) and Terrorist Financing Regulations (the Regulations) to strengthen the identification and customer due diligence (CDD) provisions of the Regulations. The proposed amendments are intended to assist reporting entities to better identify customers and understand their activities, thereby improving the ability of reporting entities to identify transactions and activities that are at greater risk for money laundering or terrorist financing.

Given that cooperation between the public and private sectors is critical to the success of Canada's Anti-Money Laundering and Anti-Terrorist Financing Regime, the Department of Finance would like to invite you to comment on a consultation paper setting out the proposed regulatory amendments.

The consultation paper (Proposed Amendments to the Proceeds of Crime (Money Laundering) and Terrorist Financing Regulations on Ascertaining Identity) is now available on the Department of Finance website (http://www.fin.gc.ca/activty/consult/pcmltfrai-rrpcfatvic-eng.asp).