Glossary
MSB & FINTRAC compliance glossary
Plain-language definitions of the terms that come up when you register and run a money services business in Canada — AML, FINTRAC, crypto, RPAA, and the rest.
Business types & registration
MSB (money services business)
A business that, for the public, deals in foreign exchange, money transfer, issuing or redeeming money orders, dealing in virtual currency, or related payment activities above Canadian thresholds. Operating as an MSB requires FINTRAC registration.
Foreign MSB
A business based outside Canada that directs MSB services at people in Canada. Under the PCMLTFA it must register with FINTRAC just like a domestic MSB, regardless of where it is incorporated.
PSP (payment service provider)
A business that performs retail payment functions (holding funds, initiating or authorising transfers, providing payment accounts). Many PSPs fall under the RPAA and may also be MSBs.
Regulators & frameworks
FINTRAC
The Financial Transactions and Reports Analysis Centre of Canada — the federal regulator that administers MSB registration and anti-money-laundering supervision under the PCMLTFA.
PCMLTFA
The Proceeds of Crime (Money Laundering) and Terrorist Financing Act — the law that defines MSB obligations, including registration, compliance programs, reporting, and record keeping.
RPAA (Retail Payment Activities Act)
The Bank of Canada framework that requires many payment service providers to register and maintain operational-risk and fund-safeguarding controls. See RPAA registration.
FATF
The Financial Action Task Force — the global body whose recommendations (including the travel rule) shape Canadian AML rules for money services and virtual currency.
CSA (Canadian Securities Administrators)
The umbrella of provincial securities regulators. Most custodial crypto trading platforms must also register with the CSA as securities dealers — see our crypto exchange licensing guide.
Compliance program & roles
AML / ATF
Anti-money-laundering and anti-terrorist-financing — the controls every MSB must implement to detect and prevent illicit finance.
Compliance program
The mandatory set of policies, risk assessment, training, and independent review an MSB must maintain under the PCMLTFA. See AML/ATF compliance programs.
CAMLO
Chief Anti-Money Laundering Officer — the person an MSB appoints to own its compliance program. Can be outsourced when an in-house hire is not practical.
MLRO
Money Laundering Reporting Officer — the role responsible for reviewing and filing suspicious transaction reports; often combined with the CAMLO function.
Risk assessment
The documented analysis of the money-laundering and terrorist- financing risks a business faces, given its products, clients, geographies, and channels. It drives the rest of the compliance program.
FINTRAC examination
A compliance audit in which FINTRAC tests whether your program exists and works in practice. See how to prepare for a FINTRAC audit.
Know your customer
KYC (know your customer)
Verifying the identity of every client before doing business with them, using methods FINTRAC accepts.
CDD (customer due diligence)
The baseline process of identifying a client, understanding the purpose of the relationship, and monitoring activity over time.
EDD (enhanced due diligence)
Heightened scrutiny applied to higher-risk clients — for example PEPs or clients moving large or unusual sums — including source-of-funds checks.
Beneficial ownership
The real individuals who ultimately own or control a company. MSBs must identify them and keep ownership records current.
PEP (politically exposed person)
A person who holds, or is closely connected to, a prominent public position. PEP status triggers enhanced due diligence.
Sanctions screening
Checking clients and counterparties against sanctions and watch lists. A non-negotiable control, especially for crypto where addresses can be listed quickly.
Reporting & records
STR (suspicious transaction report)
A report filed with FINTRAC whenever there are reasonable grounds to suspect money laundering or terrorist financing. Declining a transaction does not remove the duty to report it.
LVCTR (large virtual currency transaction report)
A report required for virtual currency transactions of CAD 10,000 or more, including amounts aggregated over 24 hours from the same client.
EFTR (electronic funds transfer report)
A report required when fiat currency of CAD 10,000 or more moves internationally on a client's behalf.
Record keeping
The obligation to retain identification, transaction, and compliance records for the periods FINTRAC prescribes, so they can be produced during an examination.
Crypto & virtual currency
VASP (virtual asset service provider)
An international term for crypto businesses. In Canada these operate as virtual currency dealers and register as MSBs with FINTRAC.
Virtual currency dealer
The FINTRAC MSB category for exchanging or transferring virtual currency as a business — covering exchanges, OTC desks, and ATMs.
Travel rule
The requirement to pass sender and recipient information alongside virtual currency transfers of CAD 1,000 or more, mirroring the wire-transfer rule.
Blockchain analytics
Tools (Chainalysis, Elliptic, and similar) used to trace on-chain activity and screen wallets for risk — effectively table stakes for a compliant crypto business.
Banking
De-risking
When a bank declines or closes accounts for an entire category it considers high-risk — MSBs and crypto businesses especially. The main reason MSB banking is hard.
Get In Touch
Not sure which of these apply to you?
Most founders book a short call to map their obligations — registration, compliance, banking — before committing to anything.
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