Proceeds of Crime (Money Laundering) and Terrorist Financing Regulations

122 (1) A financial entity, life insurance company, life insurance broker or agent, money services business, foreign money services business or casino that determines under subparagraph 116(1)(b)(i) or (iii), paragraph 117(a) or 120(1)(a) to (b.1) or (2)(a) to (b.1) or subsection 120.2(3) that a person is a politically exposed foreign person or a family member — referred to in subsection 2(1) — of, or a person who is closely associated with, such a person shall

• (a) take reasonable measures to establish the source of the funds or virtual currency used for the transaction and the source of the person’s wealth; and

• (b) ensure that a member of senior management reviews the transaction.

(2) A financial entity, money services business or foreign money services business that determines under subparagraph 116(1)(b)(iv) or paragraph 120(1)(c) or (2)(c) that a person is a politically exposed foreign person or a family member — referred to in subsection 2(1) — of, or a person who is closely associated with, such a person shall

• (a) take reasonable measures to establish the source of the virtual currency used for the transaction and the source of the person’s wealth; and

• (b) ensure that a member of senior management reviews the transaction.

(3) A financial entity, money services business or foreign money services business that determines under subparagraph 116(1)(b)(ii) or (v) or paragraph 120(1)(b) or (d) or (2)(b) or (d) that a beneficiary is a politically exposed foreign person or a family member — referred to in subsection 2(1) — of, or a person who is closely associated with, such a person shall ensure that a member of senior management reviews the transaction.

(4) A life insurance company or life insurance broker or agent that determines under paragraph 117(b) that a beneficiary is a politically exposed foreign person or a family member — referred to in subsection 2(1) — of, or a person who is closely associated with, such a person shall

• (a) take reasonable measures to establish the source of the funds or virtual currency that they receive from an annuitant of an immediate or deferred annuity or from a holder of a life insurance policy referred to in that paragraph and the source of the beneficiary’s wealth; and

• (b) ensure that a member of senior management reviews the transaction.

(5) A financial entity, life insurance company, life insurance broker or agent, money services business, foreign money services business or casino shall also take the measures referred to in paragraphs (1)(a) and (b) if

• (a) they determine under subparagraph 116(1)(b)(i) or (iii), paragraph 117(a) or 120(1)(a) or (2)(a) or subsection 120.2(3) that a person is a politically exposed domestic person or a head of an international organization, or a family member — referred to in subsection 2(1) — of, or a person who is closely associated with, one of those persons; and

• (b) they consider, based on an assessment of the risk referred to in subsection 9.6(2) of the Act, that there is a high risk of a money laundering offence or terrorist activity financing offence.

(6) A financial entity, money services business or foreign money services business shall also take the measures referred to in paragraphs (2)(a) and (b) if

• (a) they determine under subparagraph 116(1)(b)(iv) or paragraph 120(1)(c) or (2)(c) that a person is a politically exposed domestic person or a head of an international organization, or a family member — referred to in subsection 2(1) — of, or a person who is closely associated with, one of those persons; and

• (b) they consider, based on an assessment of the risk referred to in subsection 9.6(2) of the Act, that there is a high risk of a money laundering offence or a terrorist activity financing offence.

(7) A financial entity, money services business or foreign money services business shall also take the measure referred to in subsection (3) if

• (a) they determine under subparagraph 116(1)(b)(ii) or (v) or paragraph 120(1)(b) or (d) or (2)(b) or (d) that a beneficiary is a politically exposed domestic person or a head of an international organization, or a family member — referred to in subsection 2(1) — of, or a person who is closely associated with, one of those persons; and

• (b) they consider, based on an assessment of the risk referred to in subsection 9.6(2) of the Act, there is a high risk of a money laundering offence or a terrorist activity financing offence.

(8) A life insurance company or life insurance broker or agent shall also take the measures referred to in paragraphs (4)(a) and (b) if

• (a) they determine under paragraph 117(b) that a beneficiary is a politically exposed domestic person or a head of an international organization, or a family member — referred to in subsection 2(1) — of, or a person who is closely associated with, one of those persons; and

• (b) they consider, based on an assessment of the risk referred to in subsection 9.6(2) of the Act, that there is a high risk of a money laundering offence or terrorist activity financing offence.

(9) A financial entity, life insurance company, life insurance broker or agent, money services business, foreign money services business or casino shall take the reasonable measures referred to in paragraphs 116(1)(b) and 117(a) and subsections 120(1) and (2) and 120.2(3) — and, if applicable, shall take the measures referred to in paragraphs (1)(a) and (b) or (2)(a) and (b) or subsection (3), as the case may be — within 30 days after the day on which the transaction is conducted.

(10) A life insurance company or life insurance broker or agent shall take the reasonable measures referred to in paragraph 117(b) before they first remit funds to the beneficiary under the annuity or policy and, if applicable, shall take the measures referred to in paragraphs (4)(a) and (b) before the transaction is conducted.