The First Nations Bank of Canada (FNBC) has been fined more than $600,000 by Canada’s financial intelligence agency for violations of rules around money laundering and terrorist activity financing.
Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) announced on Oct. 16 that it fined the bank $601,139.80 on Sept. 22 for failing to comply with Part 1 of the Proceeds of Crime (Money Laundering) and Terrorist Financing Act and associated regulations.
The statement from FINTRAC lists five administrative violations it says the bank was found to have committed.
It said the bank failed to submit suspicious transaction reports when there were “reasonable grounds to suspect” that the transactions were related to money laundering or a terrorist activity financing offence.
It said the bank also failed to develop and apply written compliance policies and procedures “that are kept up to date.” In addition, the bank failed to assess and document the risk of money laundering or terrorist financing, failed to take prescribed special measures, and failed to conduct “ongoing monitoring of business relationships.”
FNBC, headquartered in Saskatoon, Sask., is the first Canadian chartered bank to be independently controlled by indigenous shareholders. The bank is 88 percent indigenous owned and controlled.
FNBC said in a statement that FINTRAC identified five transactions between January and December of 2023 that did not meet its compliance standards, which the bank said “preceded the arrival of the Bank’s current CEO” in the spring of 2023. The bank noted that FINTRAC found no evidence of criminal activity.
The bank said it has taken “meaningful and measurable steps” to enhance compliance measures since early 2023, such as engaging with external compliance experts, restructuring internal oversight, and hiring a new chief compliance officer.
“The Bank has accepted the recommendations of the FINTRAC examination and continues to strengthen its oversight mechanisms to ensure the highest degree of security for all transactions,” FNBC said in the statement provided to The Epoch Times.
FINTRAC said it issued a total of 23 non-compliance violation notices to various businesses in the 2024/2025 fiscal year, which was the largest number in one year in the agency’s history, and totalled more than $25 million.
The agency has imposed more than 150 penalties across most business sectors since it was given the legislative authority to do so in 2008.
On Aug. 28, FINTRAC announced the agency had fined the British Columbia Lottery Corporation (BCLC) $1,075,000 for three violations of anti-money-laundering rules. FINTRAC said following a compliance examination, it found the corporation failed to report suspicious transactions, failed to develop and apply policies for high-risk clients, and did not take special measures for those high-risk clients.
The BCLC said in an Aug. 27 statement that it was appealing FINTRAC’s decision before the Federal Court, and said the notice outlining the violations did not include allegations of any criminal offence. The BCLC said it was “confident” that it had fully complied with all its legal and regulatory obligations.
On Sept. 4, FINTRAC said it had also imposed a $199,000 fine on the Canadian National Exhibition (CNE) Casino in July for failing to assess and document the risk of a money laundering or terrorist financing offence, as well as failing to institute and document the prescribed review. The casino has appealed the decision to the Federal Court.
On Sept. 25, FINTRAC also announced it had fined the company that runs the major cryptocurrency exchange KuCoin nearly $20 million, citing violations of Canadian money-laundering laws. KuCoin said in a press release the same day that it “strongly disagrees” with the findings has appealed the penalty to the Federal Court of Canada.
Editor’s note: This article has been updated to include comment from the First Nations Bank of Canada.
