Guideline 8B: Submitting SWIFT Electronic Funds Transfer Reports to FINTRAC

February 2006

This, along with the new Guideline 8A: Submitting non-SWIFT Electronic Funds Transfer Reports to FINTRAC Electronically and new Guideline 8C: Submitting non-SWIFT Electronic Funds Transfer Reports to FINTRAC by Paper, replaces the previous version of Guideline 8: Submitting Electronic Funds Transfer Reports to FINTRAC issued in November 2004. The changes made to this version are indicated by a side bar to the right of the modified text in the PDF version.

Table of Contents

1. General
2. Electronic Funds Transfer Reporting Requirements

   2.1 FINTRAC Enrolment

   2.2 When Do You Have to Report Electronic Funds Transfers?

   2.3 SWIFT Electronic Funds Transfers

   2.4 Electronic Funds Transfers in Foreign Currency

   2.5 Other Requirements Associated with Electronic Funds Transfers

   2.6 Reporting Timeframes for Electronic Funds Transfer Reports

3. Electronic Reporting

   3.1 SWIFT EFT Reporting

   3.2 How to Complete Electronic Reports

   3.3 Acknowledgement of Receipt of an Electronic Report

   3.4 Report Corrections

4. Instructions for Completing a SWIFT Electronic Funds Transfer Report

   4.1 General Instructions

5. Comments?
6. How to Contact FINTRAC

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1  General

The following have to report electronic funds transfers (EFTs) to the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC):

• financial entities (such as banks or authorized foreign banks with respect to their operations in Canada , credit unions, caisses populaires, trust and loan companies and agents of the Crown that accept deposit liabilities);
• foreign exchange dealers (persons and entities engaged in the business of foreign exchange dealing); and
• money services businesses (including alternative remittance systems, such as Hawala, Hindi, Chitti, etc.).

If you are one of these “reporting entities”, this guideline has been prepared by FINTRAC to help you submit EFT reports. It explains reporting timelines, how reports have to be sent to FINTRAC, and what information has to be included in these reports.

For guidance on who is engaged in the business of money services or foreign exchange dealing, refer to the FINTRAC Interpretation Notice on this topic available from the Publications area of FINTRAC’s Web site.

This guideline uses plain language to explain the most common reporting situations under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (the Act) as well as the related Regulations. It is provided as general information only. It is not legal advice, and is not intended to replace the Act and Regulations. For more information about money laundering, terrorist financing or other requirements under the Act and Regulations, see the guidelines in this series:

• Guideline 1: Backgrounder explains money laundering and terrorist financing and their international nature. It also provides an outline of the legislative requirements as well as an overview of FINTRAC’s mandate and responsibilities.
• Guideline 2: Suspicious Transactions explains how to report a suspicious transaction. It also provides guidance on how to identify a suspicious transaction, including general and industry-specific indicators that may help when conducting or evaluating transactions.
• Guideline 3: Submitting Suspicious Transaction Reports to FINTRAC explains when and how to submit suspicious transaction reports. There are two different versions of Guideline 3, by reporting method.
• Guideline 4: Implementation of a Compliance Regime explains the requirement for reporting persons and entities to implement a regime to ensure compliance with their obligations under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act and associated Regulations.
• Guideline 5: Submitting Terrorist Property Reports to FINTRAC explains to reporting persons and entities when and how to submit a terrorist property report.
• Guideline 6: Record Keeping and Client Identification explains the requirement for reporting persons and entities to identify their clients and keep records. There are eight different versions of Guideline 6, by sector.
• Guideline 7: Submitting Large Cash Transaction Reports to FINTRAC explains when and how to submit large cash transaction reports. There are two different versions of Guideline 7, by reporting method.
• Guideline 8: Submitting Electronic Funds Transfer Reports to FINTRAC explains when and how to submit electronic funds transfer reports. There are three different versions of Guideline 8, by report type and reporting method.
• Guideline 9: Submitting Alternative to Large Cash Transaction Reports to FINTRAC explains when and how financial entities can choose the alternative to large cash transaction reports. This is only applicable to financial entities.

If you need more help after you read this or other guidelines, call FINTRAC’s national toll-free enquiries line at 1-866-346-8722.

Throughout these guidelines, several references are provided to additional information that may be available on external Web sites. FINTRAC is not responsible for the accuracy or reliability of the information contained on those external Web sites. The links provided are based on information available at the time of publishing of this guideline.

Throughout this guideline, any references to dollar amounts (such as $10,000) refer to the amount in Canadian dollars or its equivalent in foreign currency. Also throughout this guideline, the term “reporting entity” refers to any person or entity required to report to electronic funds transfers to FINTRAC.

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2 Electronic Funds Transfer Reporting Requirements

2.1 FINTRAC Enrolment

Effective February 2006, as a reporting entity, you have to be enrolled with FINTRAC for electronic reporting. FINTRAC will provide you with an identifier number to include in your reports.

If you were already submitting reports to FINTRAC before February 2006, your enrolment should be processed automatically. If you have previously reported, but have not received your identifier number before February 2006, please contact FINTRAC (as explained in Section 6).

If you have never reported to FINTRAC, please contact FINTRAC (as explained in Section 6) to enrol before you report.

For more information about FINTRAC enrolment, contact us as explained in Section 6.

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2.2 When Do You Have to Report Electronic Funds Transfers?

If you are a financial entity, a money services business or a foreign exchange dealer, you have to report certain international EFTs to FINTRAC. This guideline explains the reporting requirements related to SWIFT EFTs. If you send EFTs other than those explained below, read Guideline 8A: Submitting non-SWIFT Electronic Funds Transfer Reports to FINTRAC Electronically.

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2.3 SWIFT Electronic Funds Transfers

The SWIFT EFT reporting requirement is only applicable to you if you send EFTs by transmission of a SWIFTMT 103 message, as a SWIFT member, through the SWIFT network. SWIFT means the Society for Worldwide Interbank Financial Telecommunication. It is a co-operative owned by the international banking community that operates a global data processing system for the transmission of financial messages.

You have to send a SWIFT EFT report to FINTRAC for the following transactions:

Outgoing EFTs.

These are SWIFTMT 103 messages for $10,000 or more sent outside Canada at the request of a client in the following manner:

• in a single transaction; or
• in two or more transfers of less than $10,000 each (that total $10,000 or more) in the following situations:
  • if you are an entity, your employee or senior officer knows the transfers were made within 24 consecutive hours of each other by or on behalf of the same individual or entity; or
  • if you are an individual, you know the transfers were made within 24 consecutive hours of each other by or on behalf of the same individual or entity.

This type of EFT requires that you send an outgoing SWIFT EFT report to FINTRAC. These reports can only be sent electronically, by batch, as explained in Section 3.

It can happen that a client requests a transfer of funds and, instead of sending the EFT yourself, you order someone else that is a financial entity, a money services business or a foreign exchange dealer in Canada to send it. In this case, you have to make the related non-SWIFT EFT report (EFTO) to FINTRAC unless you provide that other reporting entity with the client’s name and address. In other words, if you give them your client’s name and address, you do not have to report the EFT. See Appendix 2 for example scenarios of this type of situation.

Incoming EFTs.

These are SWIFTMT 103 messages for $10,000 or more that you receive and that are sent from outside Canada at the request of a client in the following manner:

• in a single transaction; or
• in two or more transfers of less than $10,000 each (that total $10,000 or more) in the following situations:
  • if you are an entity, your employee or senior officer knows the transfers were made within 24 consecutive hours of each other by or on behalf of the same individual or entity; or
  • if you are an individual, you know the transfers were made within 24 consecutive hours of each other by or on behalf of the same individual or entity.

This type of EFT requires that you send an incoming SWIFT EFT report to FINTRAC. These reports can only be sent electronically, by batch, as explained in Section 3.

If you are a financial entity, money services business or foreign exchange dealer and you received instructions for a transfer of funds from outside Canada, you have to make the related incoming EFT report to FINTRAC, even if you have to forward the same instructions to another financial entity, money service business or foreign exchange dealer in Canada. However, if you receive this type of instructions from another financial entity, money services business or foreign exchange dealer in Canada, you do not have to make an incoming EFT report even if the original sender was outside Canada. See Appendix 2 for example scenarios of this type of situation.

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2.4 Electronic Funds Transfers in Foreign Currency

If you send an EFT in a foreign currency, you will need to check whether it is the equivalent of 10,000 Canadian dollars or more to determine whether or not it is reportable to FINTRAC. For this purpose only, use the last noon exchange rate provided by the Bank of Canada available at the time of the transaction, instead of the actual exchange rate used to process the transaction. This calculation is only to check whether the $10,000 threshold is met for the transaction to be reportable as an EFT transaction.

For example, for an EFT that happened at 9:00 am on Tuesday following a holiday Monday, you would use the Bank of Canada noon rate from the previous working day (in this case, Friday) to determine whether the transaction is reportable. You can find the noon rate on the Bank of Canada Web site at http://www.bankofcanada.ca/en/exchange.htm.

If there is no Bank of Canada noon rate published for the currency of the transaction, use the actual exchange rate applied when you processed the transaction to determine whether it is reportable.

Once you have determined that an EFT in a foreign currency is reportable based on the Bank of Canada noon rate, you will have to send an EFT report to FINTRAC. On the EFT report in Part A, enter the amount of the transaction in the foreign currency. If you converted this amount to or from Canadian dollars when you processed the transaction (other than using the Bank of Canada noon rate to determine whether or not it was reportable), enter the actual exchange rate you used to process the EFT in Part A of the report.

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2.5 Other Requirements Associated with Electronic Funds Transfers

In addition to the reporting requirements explained in this guideline, consider the following relating to an EFT transaction:

Record keeping and client identification
EFTs have associated record keeping and client identification requirements. These are explained in Guideline 6: Record Keeping and Client Identification.

Large cash transaction report
If an EFT transaction is initiated in cash (in the amount of $10,000 or more), you will likely have to make a large cash transaction report to FINTRAC in addition to making the EFT report about the transaction as required.

For more information about making large cash transaction reports, consult Guideline 7: Submitting Large Cash Transaction Reports to FINTRAC.

Suspicious transaction report
If anything about an EFT transaction gives you reasonable grounds to suspect that it could be related to a money laundering or a terrorist activity financing offence, you have to make a suspicious transaction report to FINTRAC about the same transaction. This would be in addition to making the EFT report about the transaction as required.

The suspicious transaction report has many fields that are different from those of an EFT report. For example, there is a field in the suspicious transaction report for you to explain your suspicion about the transaction. There is also a field in that report for you to describe what action, if any, was taken by you, as a result of the suspicious transaction. This would include stating that you have made an EFT report for the same transaction (if that is the case).

For more information about making suspicious transaction reports, consult the following guidelines:

• Guideline 1: Backgrounder
• Guideline 2: Suspicious Transactions
• Guideline 3: Submitting Suspicious Transaction Reports to FINTRAC

Transactions related to terrorist property
If you know that any proposed transaction is related to property owned or controlled by or on behalf of a terrorist or a terrorist group, you should not complete the transaction. This is because terrorist property must be frozen under the United Nations Suppression of Terrorism Regulations as well as the Criminal Code.

For more information about this and to find out what your obligations are regarding any terrorist property in your control or possession, consult the following guidelines:

• Guideline 1: Backgrounder
• Guideline 5: Submitting Terrorist Property Reports to FINTRAC

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2.6 Reporting Timeframes for Electronic Funds Transfer Reports

You have to send EFT reports to FINTRAC no later than five working days after the day of the transfer.

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3 Electronic Reporting

3.1 SWIFT EFT Reporting

SWIFT EFT reports can only be sent to FINTRAC electronically, by batch. These reports cannot be made on paper.

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3.2 How to Complete Electronic Reports

For the batch file reporting mechanism, you need a public key infrastructure (PKI) certificate and specialized software available from FINTRAC. For more information about batch reporting SWIFT EFTs, consult the specifications document called SWIFT Batch Reporting Instructions and Specification. This document is available from the publications area of FINTRAC’s Web site (see technical documentation at http://www.fintrac.gc.ca/publications/pub_e.asp). Also refer to the Appendix 1 of this guideline for instructions and details regarding the content of a SWIFT EFT report.

For more information about batch reporting, including how to get a PKI certificate and the specialized software required, refer to the reporting area of FINTRAC’s Web site at http://www.fintrac.gc.ca/reporting--declaration/1_e.asp.

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3.3 Acknowledgement of Receipt of an Electronic Report

FINTRAC will send you an acknowledgement message when your EFT report has been received electronically. This will include the date and time your report was received and a FINTRAC-generated identification number. Please keep this information for your records.

For the reports you send by batch, you will receive two acknowledgements. The first will confirm that your batch has been received by FINTRAC. The second will confirm that it has been processed.

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3.4 Report Corrections

If your EFT report contains incomplete information, FINTRAC may notify you. The notification will indicate the date and time your report was received, the FINTRAC-generated identification number, along with information on the fields that must be completed or corrected.

After receiving FINTRAC’s notification, you should provide the necessary information to FINTRAC within the five-working-day reporting deadline. In other words, this information should be sent to FINTRAC within five working days of the transaction. Your obligation to report will not be fulfilled until you send the complete report to FINTRAC.

For more information about this, refer to the SWIFT Batch Reporting Instructions and Specification.

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4 Instructions for Completing a SWIFT Electronic Funds Transfer Report

4.1 General Instructions

The contents of a SWIFT EFT report depend on whether the report is about an outgoing or incoming transfer. The required information for each type of report is listed in Appendices 1A and B, as follows:

• Outgoing International SWIFT EFT Report (see Appendix 1A)
• Incoming International SWIFT EFT Report (see Appendix 1B)

Based on the reporting requirements for SWIFT EFT reports, information is either mandatory, mandatory where applicable, or requires "reasonable efforts", as follows:

• Mandatory: This information has to be provided.
• Mandatory where applicable: This information has to be provided if it is applicable to you or the transaction being reported.
• Reasonable efforts: For all other information required, you have to make reasonable efforts to get the information. "Reasonable efforts" means that you tried to get the information required in the report. If the information is available to you, you must provide it in the report. If the information was not available at the time of the transaction, and it is not contained in your files or records, the relevant field(s) may be left blank.

The specifications for SWIFT EFT reports do not reflect the mandatory, mandatory where applicable and reasonable efforts fields in the same manner as your other reports to FINTRAC. The SWIFT EFT report specifications reflect "tags" according to the way information is entered to transmit the EFT message based on the SWIFT network rules. In some cases, those rules can be different from what is required in your report to FINTRAC.

Here are some examples to illustrate this point:

For these reasons, tags in the SWIFT EFT report do not use asterisks to demonstrate mandatory fields. The instructions for each tag in the report explain which information is mandatory or mandatory where applicable and which requires reasonable efforts.

As explained in Section 2.3, EFT reports can be about one of multiple EFTs of less than $10,000 each conducted within 24 consecutive hours of each other that add up to $10,000 or more. Because those individual EFTs were each under $10,000, some of the information that is mandatory for the report may not be available in your records or from the time of the transaction. In this case, "reasonable efforts" applies to this otherwise mandatory information.

You have to complete a separate EFT report for each EFT transaction, even if you are reporting multiple EFTs of less than $10,000.

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5. Comments?

These guidelines will be reviewed on a periodic basis. If you have any comments or suggestions to help improve them, please send your comments to the mailing address provided below, or by email to guidelines@fintrac.gc.ca.

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6. How to Contact FINTRAC

For further information on FINTRAC and its activities, and report submission, please go to FINTRACs Web site or contact FINTRAC:

Financial Transactions and Reports Analysis Centre of Canada
234 Laurier Avenue West, 24th floor
Ottawa, Ontario
Canada K1P 1H7

Toll-free: 1-866-346-8722

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