Canada’s financial intelligence agency, the Financial Transactions and Reports Analysis Centre of Canada (Fintrac), has imposed a significant penalty of approximately 1.3 million Canadian dollars ($977,900) on Canadian Imperial Bank of Commerce (CIBC). The penalty is a result of the bank’s failure to comply with anti-money laundering and terrorist financing measures.
This announcement comes as the second penalty disclosed by Fintrac this week. Earlier, Royal Bank of Canada faced a penalty of around C$7.4 million following a compliance examination conducted in 2022.
Fintrac revealed that its enforcement action against CIBC was based on a compliance investigation carried out in 2021. The investigation found that the prominent Canadian lender had neglected to submit suspicious transaction reports when there were reasonable grounds to believe that transactions were linked to money laundering or terrorist activity financing. Furthermore, CIBC was accused of failing to provide incoming electronic funds transfer reports with the requisite information.
It is important to note that the penalty imposed on CIBC is administrative, rather than criminal, in nature. The bank has already paid the full amount, and the proceedings have been closed, according to Fintrac.
Similarly, Royal Bank was found to have committed three administrative violations related to transaction reports, provision of information, and keeping written policies and procedures up to date.
For more information, contact Robb M. Stewart.