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FINTRAC imposes $1.3M administrative penalty on CIBC
December 8, 2023
8:00 am
SaverJunior
Toronto
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Banks fined this year:

  Wealth One Bank of Canada - $0.67M
  Royal Bank of Canada - $7.4M
  CIBC - $1.3M

There have been comments such as "callous disregard for regulatory reporting requirements", or "insufficient due diligence and auditing". I thought perhaps WoBC was a bad apple, but then with the Big 5 on the row, it looks like that was the "practice" for the bottom line competitiveness.

With the recent mortgage charter, bank allowing negative amortization, skipping stress test are just some of the examples of relaxing our Canadian banks' checks and balances which are supposed to keep our financial system stable.

There has been reports of mortgages with amortizations in excess of 90 years.

Relaxing the rules, or no banks enforce the rules 100% to all their transactions could lead to a drama like 2008. I am sure we have quite a percentage of mortgages are subprime and increasing by the day.

Canada's financial intelligence agency says it has levied a $1.3-million penalty against CIBC for non-compliance with money laundering and terrorist financing measures.

The penalty, imposed on Oct. 23 but only reported Thursday, is the second the Financial Transactions and Reports Analysis Centre of Canada has announced this week after RBC's $7.4-million fine was publicized on Tuesday.

The agency, known as Fintrac, says it imposed the penalty over CIBC's failure to submit a suspicious transaction report when there were grounds to suspect it was related to money laundering or terrorist activity, and failures to report information related to large money transfers from outside Canada.

Fintrac tries to pinpoint money linked to illicit activities by electronically sifting through millions of pieces of information each year from banks, insurance companies, money services businesses and others.

It then discloses intelligence to police and other law-enforcement agencies about the suspected cases.

Fintrac said that during its 2021 examination, it found an instance where CIBC didn't file a suspicious transaction report even though it knew the client had been arrested and charged with criminal offences. The agency's review also found over a thousand instances, out of a sample of 20,000, where information related to money transfers was incomplete.

Sarah Paquet, chief executive of the agency, said in a statement that the rules around reporting are in place to protect Canadians and the security of the economy.

"We will also be firm in ensuring that businesses continue to do their part and we will take appropriate actions when they are needed," she said.

CIBC spokesman Tom Wallis said in a statement that the bank has robust anti-money laundering and anti-terrorist financing procedures and practices in place.

He said the administrative matters were related to a relatively small number of transactions that the bank has since resolved and it continues to invest in monitoring and detection capabilities.

"We take our responsibilities seriously and will continue to identify, investigate and do our part to deter and detect financial crimes," Wallis said.

Fintrac said CIBC had paid its penalty in full and proceedings have ended.

RBC, which was hit by the highest-ever penalty by the agency, was found to have failed to submit 16 suspicious transaction reports out of 130 reviewed, when there were reasonable grounds to suspect dealings were related to an attempted or actual money laundering or terrorist financing offence.

December 8, 2023
8:31 am
cgouimet
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SaverJunior said
Banks fined this year:

  Wealth One Bank of Canada - $0.67M
  Royal Bank of Canada - $7.4M
  CIBC - $1.3M

There have been comments such as "callous disregard for regulatory reporting requirements", or "insufficient due diligence and auditing". I thought perhaps WoBC was a bad apple, but then with the Big 5 on the row, it looks like that was the "practice" for the bottom line competitiveness.

With the recent mortgage charter, bank allowing negative amortization, skipping stress test are just some of the examples of relaxing our Canadian banks' checks and balances which are supposed to keep our financial system stable.

There has been reports of mortgages with amortizations in excess of 90 years.

Relaxing the rules, or no banks enforce the rules 100% to all their transactions could lead to a drama like 2008. I am sure we have quite a percentage of mortgages are subprime and increasing by the day.

Canada's financial intelligence agency says it has levied a $1.3-million penalty against CIBC for non-compliance with money laundering and terrorist financing measures.

The penalty, imposed on Oct. 23 but only reported Thursday, is the second the Financial Transactions and Reports Analysis Centre of Canada has announced this week after RBC's $7.4-million fine was publicized on Tuesday.

The agency, known as Fintrac, says it imposed the penalty over CIBC's failure to submit a suspicious transaction report when there were grounds to suspect it was related to money laundering or terrorist activity, and failures to report information related to large money transfers from outside Canada.

Fintrac tries to pinpoint money linked to illicit activities by electronically sifting through millions of pieces of information each year from banks, insurance companies, money services businesses and others.

It then discloses intelligence to police and other law-enforcement agencies about the suspected cases.

Fintrac said that during its 2021 examination, it found an instance where CIBC didn't file a suspicious transaction report even though it knew the client had been arrested and charged with criminal offences. The agency's review also found over a thousand instances, out of a sample of 20,000, where information related to money transfers was incomplete.

Sarah Paquet, chief executive of the agency, said in a statement that the rules around reporting are in place to protect Canadians and the security of the economy.

"We will also be firm in ensuring that businesses continue to do their part and we will take appropriate actions when they are needed," she said.

CIBC spokesman Tom Wallis said in a statement that the bank has robust anti-money laundering and anti-terrorist financing procedures and practices in place.

He said the administrative matters were related to a relatively small number of transactions that the bank has since resolved and it continues to invest in monitoring and detection capabilities.

"We take our responsibilities seriously and will continue to identify, investigate and do our part to deter and detect financial crimes," Wallis said.

Fintrac said CIBC had paid its penalty in full and proceedings have ended.

RBC, which was hit by the highest-ever penalty by the agency, was found to have failed to submit 16 suspicious transaction reports out of 130 reviewed, when there were reasonable grounds to suspect dealings were related to an attempted or actual money laundering or terrorist financing offence.

  

Did you forget you posted this yesterday (https://www.highinterestsavings.ca/forum/rbc-royal-bank/fintrac-imposes-7-4m-administrative-penalty-on-royal-bank-of-canada/) ???

CGO
December 8, 2023
9:01 am
SaverJunior
Toronto
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cgouimet, I reported a news about Royal Bank of Canada yesterday. Today it was about CIBC plus some thoughts of my own. They are different, if that's what you meant.

I disclose that I have some interests in RBC.

December 8, 2023
9:10 am
cgouimet
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SaverJunior said
cgouimet, I reported a news about Royal Bank of Canada yesterday. Today it was about CIBC plus some thoughts of my own. They are different, if that's what you meant.

I disclose that I have some interests in RBC.  

CGO
December 9, 2023
4:22 am
smayer97
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This has nothing to do with subprime mortgages, etc. This is about anti-money-laundering measures.

Simply looks like FINTRAC is looking to raise some capital, to fund the Canadian debt. 😉

December 9, 2023
8:16 am
mordko
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The fines appear too small compared to net income of over $5bn (CIBC). Let’s hope the banks notice.

W1 is a different story entirely.

December 9, 2023
8:33 am
savemoresaveoften
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mordko said
The fines appear too small compared to net income of over $5bn (CIBC). Let’s hope the banks notice.

W1 is a different story entirely.  

yes it takes WI a lot longer to make $0.67mm then TD to make $1.3mm

December 9, 2023
8:39 am
RetirEd
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Let's not forget to add HSBC to that list...

SaverJunior said
Banks fined this year:

  Wealth One Bank of Canada - $0.67M
  Royal Bank of Canada - $7.4M
  CIBC - $1.3M

There have been comments such as "callous disregard for regulatory reporting requirements", or "insufficient due diligence and auditing". I thought perhaps WoBC was a bad apple, but then with the Big 5 on the row, it looks like that was the "practice" for the bottom line competitiveness.

RetirEd

December 9, 2023
8:41 am
SaverJunior
Toronto
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I agree, the fines might seem hefty to many, but they are only symbolic, not even a tickle to the banks. If profits from those "transactions" outweigh the fines, business will be just as usual.

smayer97, the national debt sits at $1.2T. The fines collected this year is barely a drop in the bucket. I imagine the "capital" raised would make a decent bonus though for the CEO this Christmas. sf-embarassed

December 9, 2023
1:07 pm
smayer97
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Then I guess the government does not need my or your taxes.... :-\

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