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As a company benefiting from the services of a Payroll Services Provider (PSP), you may be asked by your PSP to provide documents and information validating your company’s identity, which can also require information on individuals in key roles within your organization. PSPs are subject to the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) requirements, since they are now considered Money Services Businesses (MSBs).
Specifically, FINTRAC requires PSPs to implement anti-money laundering (AML) Compliance Programs. This includes the "Know Your Client" (KYC) process to verify the identity of new and existing clients and assessing the potential risks associated with financial transactions, especially those related to money laundering and terrorist financing. The requirements are prescriptive and include the following:
Reporting entities, such as PSPs, must verify the identity of their clients, which can be individuals or businesses, using prescribed methods like, articles of incorporation, business schemas or on an individual basis, government-issued photo identification, credit files, or dual-process methods.
For businesses, MSBs must verify the beneficial owners, who have significant control or ownership, directors, and authorized representatives.
Please be assured that your PSP is doing its part to securely collect this information with a strict purpose to meet Canadian regulatory obligations. Should you have any questions on the security of the information, please contact your PSP.
Should you have any concerns regarding identification requirements, FINTRAC can be contacted at: information@fintrac-canafe.gc.ca