Financial Management Flashcards
What is OSFI and what level of governmental oversight does OSFI have?
Office of Superintendent of Financial Institutions. It has federal oversight.
Who does OSFI report to?
The Minister of Finance.
What is OSFI’s two mandates?
- Regulating - Setting rules and providing approvals for certain types of financial transactions - for financial entities in Canada.
- Supervising - monitoring and analyzing financial and economic trends for issues that might impact the financial institutions it regulates.
Which financial institutions does OSFI regulate and supervise?
- All banks in Canada
- All federally incorporated and registered trust and loan companies.
- Insurance companies
- Co-operative credit associations
- Private pension plans
What is FINTRAC and what level of governmental oversight does it have?
Financial Transaction and Report Analysis Centre of Canada - It is Canada’s financial intelligence unit. It is has federal oversight.
What is FINTRAC mandates?
Assist in the detection, prevention, and deterrence of money laundering and terrorist financing by producing and providing financial intelligence to law enforcement agencies.
What are the three Know Your Client (KYC) rules that FINTRAC enforces?
- Verifying the identity of persons / entities for certain transactions.
- Beneficial ownership confirmation for certain entities.
- Identifying politically exposed persons or heads of international organization.
What are FINTRAC reporting requirements?
- Suspicious transactions that are out of the ordinary, involves numerous steps or parties, or are otherwise suspicious.
- Terrorist property reports.
- Large cash transaction of $10,000 in a single transaction or multiple transactions in the span of 24 hours.
What are the consequences of violating FINTRAC’s reporting obligations?
- Monetary and criminal prosecution for both the individual and/or employer.
- Up to five years imprisonment and a fine of up to $2 million.
- Violations are shared with other regulators and are also reported to the public on the FINTRAC website.
What are the three stages of money laundering?
- Placement - Placing illicit funds into the banking system / legitimate economy (most vulnerable part) without raising suspicion. It must be done rapidly to avoid the risk of holding onto cash.
- Layering - Disguise the source of illicit money by separating it from the placement through a series of transactions, transfer, or investments, all designed to make tracing difficult.
- Integration - Moving the money back to the criminal source and making the movement appears to be from legal, and legitimate sources. It often involves removing the laundered money from the financial system and storing it in transactions involving real estate, art works, or high-end automobiles.
What is FCAC, what level of governmental oversight does it have, and who does it report to?
Financial Consumer Agency of Canada.
It has federal oversight.
The head of the FCAC is appointed by the government of Canada and report to the Minister of Finance annually.
What is the FCAC mandate?
Financial Consumer Agency of Canada exists to protect the rights of consumers of financial services.
- Promote awareness of the rights and responsibilities of Canadians dealing with financial institutions.
- Monitor and promote awareness of issues that may affect financial consumers.
- Publish research, tools, or programs to strengthen financial literacy of Canadians.
What is the OPC, what level of governmental oversight does it have, and what are its mandate?
Office of Privacy Commissioner of Canada.
It has federal oversight.
Its mandate is to oversees compliance with the Canada Privacy Act.
What is the role of the Canada Privacy Act?
Covers the handling of personal information within federal government departments and agencies.
What is PIPEDA and what are its mandates?
The Personal Information Protection and Electronic Documents Act.
Requires consent from individuals to collect or use that personal information.
Ensure that information must be safeguard against theft and unwarranted access. Violation of PIPEDA will result in monetary fine and/or civil or class action lawsuits.
