- Money Services Business (MSB)
- A business that provides services such as foreign exchange dealing or remitting funds. In Canada, MSBs must register with FINTRAC and maintain an anti-money laundering compliance programme.
- FINTRAC
- The Financial Transactions and Reports Analysis Centre of Canada, Canada’s financial intelligence unit and anti-money laundering supervisor. It maintains the public registry of Money Services Businesses.
- PCMLTFA
- The Proceeds of Crime (Money Laundering) and Terrorist Financing Act, the Canadian law that sets client identification, record keeping and reporting obligations for Money Services Businesses.
- Beneficial owner
- An individual who directly or indirectly owns or controls 25% or more of an entity, or who otherwise controls it. Regulated payment providers are generally required to identify beneficial owners through every layer of a structure.
- Know your client (KYC)
- The process of verifying a client’s identity, ownership and the purpose of the relationship before providing services.
- Enhanced due diligence (EDD)
- Additional checks applied to higher-risk clients, such as verified source of wealth and source of funds, senior management approval and more frequent reviews.
- Politically exposed person (PEP)
- A person who holds or has held a prominent public position, or a family member or close associate of such a person. PEP relationships are subject to additional scrutiny.
- Source of wealth
- How an individual accumulated their overall wealth, for example through the sale of a business, an inheritance, employment income or investments.
- Source of funds
- Where the money for a specific transaction or relationship comes from, for example trading revenue or the sale of an asset.
- Certificate of incumbency
- A document issued by a company’s registered agent confirming its directors, shareholders and status. Common for companies in the British Virgin Islands, the Cayman Islands and Nevis.
- Certificate of good standing
- A registry document confirming that a company exists and is up to date with its filings and fees.
- International business company (IBC)
- A company formed in an international financial centre, typically for holding, trading or investment activity carried on outside that jurisdiction.
- Exempted company
- A Cayman Islands company that carries on business mainly outside the Cayman Islands. A common vehicle for Cayman holding companies and funds.
- Private trust company (PTC)
- A company formed to act as trustee of the trusts of a single family, usually owned by a purpose trust or a foundation.
- Protector
- A person appointed under a trust deed to oversee the trustees, often with power to consent to certain decisions or to replace trustees.
- Spot foreign exchange
- An agreement to exchange currencies at the current rate, for settlement within a standard short period, usually two business days.
- Value date
- The date on which the currencies in a foreign exchange trade are delivered.
- Batch payout
- A single instruction that pays many beneficiaries at once, such as affiliates, creators or trust beneficiaries.
- Travel rule
- The requirement for originator and beneficiary information to accompany transfers of funds and virtual currency.
- Sanctions screening
- Checking clients, owners and payment parties against lists of sanctioned persons and countries before acting.
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