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Bulletin #0029-M

Membership Information
Client Identification Requirements under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act

Mutual Fund Dealers Association of Canada
Association canadienne des courtiers de fonds mutuels
121 King Street West, Suite 1600, Toronto, Ontario, M5H 3T9
TEL: 416-361-6332 FAX: 416-943-1218 WEBSITE: www.mfda.ca

Contact:
Laurie
Gillett
BULLETIN #0029 – M
Membership
Services
Manager
August 20, 2003
Phone: 416-943-5827
E-mail : lgillett@mfda.ca

MFDA Bulletin

Membership Information

For Distribution to Relevant Parties within your Firm
_______________________________________________________
Client Identification Requirements under the Proceeds of Crime (Money
Laundering) and Terrorist Financing Act

The Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA)
prescribes certain client identification and recordkeeping obligations for securities dealers
including MFDA Members. Under the PCMLTFA, securities dealers must ascertain identity
when opening an account for a client. The MFDA has been advised by the Financial
Transactions and Reports Analysis Centre of Canada (FINTRAC) that there is some confusion as
to when the PCMLTFA requires securities dealers to obtain financial entity account information
(e.g. bank account number) when opening an account. The purpose of this Bulletin is to provide
clarification to MFDA Members in this regard.

Under the PCMLTFA Regulations, financial entity account information must be obtained for
identification purposes when a client is not physically present to open a securities account. In this
case, the securities dealer can either require a cleared cheque from the client or otherwise
confirm that the client holds an account in his or her name with a financial entity. This account
number must then be recorded on the signature card, the account operating agreement or the
account application.
However, when a client is present at the opening of a securities account, the dealer is only
required to identify the client by referring to an acceptable piece of government identification
such as a birth certificate, driver’s license, provincial health card or passport. Dealers are not
required under the PCMLTFA Regulations to obtain financial entity account information in this
situation. FINTRAC guidelines will be revised to reflect this clarification.

For further information MFDA Members may refer to FINTRAC’s website at:
http://www.fintrac.gc.ca.

(doc. #18100)