Why We Have These Requirements

In the aftermath of the September 11, 2001, terrorist attacks, the Canadian government amended legislation to widen its powers regarding money laundering and financing terrorist organizations. This legislation, the Proceeds of Crime (Money Laundering) and Terrorist Financing Act S.C. 2000 c. 17 (the PCMLTFA), requires the reporting of certain types of transactions to the Financial Transaction and Reports Analysis Centre of Canada (FINTRAC). The PCMLTFA purported to apply to lawyers, which abrogated solicitor-client privilege.

The Federation of Law Societies of Canada (the Federation), and the National Association of Provincial and Territorial Legal Regulators, launched a constitutional challenge. The Federation also designed Model Rules on Client Identification and Verification which reflected the principles underlying the federal legislation, while protecting solicitor-client privilege. The Law Society of Alberta adopted the Model Rules, which includes a “no cash” provision as well as Client Identification and Verification Rules

Ultimately, in 2015, the Supreme Court of Canada read down certain provisions of the PCMLTFA to exclude legal counsel and law firms from the operation of those provisions. See Attorney General Canada  v. The Federation of Law Societies of Canada, [2015] 1 SCR 401, 2015 SCC 7

Last modified: Monday, 21 August 2023, 1:21 PM