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Upcoming changes to the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA)

Background

The Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA), and its associated Regulations, has been updated and strengthened to better combat money laundering and terrorist financing activities.

Timing

Changes will be in effect as of June 17, 2017.

What is changing:

1. You will be required to identify domestic Politically Exposed Persons (PEP) and Head of an International Organization (HIO) – (form IP-LP1165).

With all lump sum payments of $100,000 or more, you will be required to do the following:

  • Complete the updated Politically Exposed Persons and Head of International Organization form (IP-LP1165)
  • Determine whether the policy holder/account holder is a foreign PEP (this is in place today), a domestic PEP, a HIO, or a family member or close associate of any of these

2. Additional details required for client identification

Along with the documents currently required, you will also be asked to provide the following:

  • Document expiry date
  • Country code from which the document was issued

3. What ivari products will be impacted?

The requirements apply to universal life insurance policies and non-registered annuity contracts (including segregated funds contract).

As well, the following applications and forms are affected and the updated versions will be available in the Administration/Forms section on June 9:

  • Insurance application (LP257) and eApplication
  • Policy Change application (LP386)
  • Conversion application (LP1285)
  • Politically Exposed Persons and Head of International Organization (IP-LP1165)
  • Allocation form (PS425)
  • Allocation form (WFG version) (WFG-LP1221)
  • Identity and Third Party Determination (IP-LP782)
  • Transfer of Ownership form (IP1270)
  • Notice of Transfer of Ownership (PS371)
  • Corporate/Non-corporate entity/Trust ownership form (IP-LP1166)
  • Policy Ownership for corporate & non-corporate entities or trusts (IP-LP1747)
  • Declaration of tax residency for an entity (IP-LP1601)

Where can I go for more information?

More information, including transition rules, will be provided in early June. In the meantime, you can visit http://www.fintrac.gc.ca/publications/guide/guide-eng.asp to learn more about the amendments to the Act and Regulations.

You can also feel free to call us at 1-800-846-5970 between the hours of 8:00am and 7:00 pm ET, Monday to Friday.