Backgrounder: Targeted indicator profiles on laundering the proceeds of extortion

Overview

As Canada's Anti-Money Laundering and Anti-Terrorist Financing (AML/ATF) Supervisor and Financial Intelligence Unit, the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) collaborates with businesses and law enforcement agencies to combat financial crime by producing strategic and tactical intelligence.

As part of the Countering Extortion Partnership initiative, FINTRAC will work with key financial institutions to co-develop indicators related to extortion by sharing indicators for information and for feedback through trusted channels. These early-stage profiles will support financial institutions and businesses in understanding and identifying the latest criminal or money laundering practices relevant to extortion, improving the timeliness and quality of suspicious transaction reports to FINTRAC.

Rationale

FINTRAC's strategic intelligence identifies emerging trends, tactics, and characteristics used by criminals to launder money, finance terrorist activities, and evade sanctions. This intelligence informs the development of indicators that help businesses detect suspicious transactions, which they report to FINTRAC. FINTRAC analyses these reports to disclose tactical financial intelligence to law enforcement or other disclosure recipients when there are reasonable grounds to suspect designated information is relevant to investigating or prosecuting a money laundering, terrorist activity financing, or sanctions evasion offence. Police of jurisdiction can then leverage FINTRAC's financial intelligence to obtain production orders, which can be in respect of the transactions initially reported to FINTRAC, in order to build the specific evidence base for their investigations, charges, and asset forfeiture actions.

For more information on FINTRAC's strategic intelligence products, which provide analytical perspectives on money laundering, terrorist financing, sanctions evasion, and other threats to Canada's security, visit the Strategic intelligence page.

Targeted indicator profiles

In order to fast-track the sharing of strategic financial intelligence and actionable indicators with key financial entities, FINTRAC has initiated Targeted Indicator Profiles (or TIP sheets) in respect of extortion. These will act as a new tool to communicate emerging indicators, trends, and typologies to businesses through trusted channels, improving the timeliness, quantity and quality of reporting to FINTRAC on extortion over traditional indicator publication methods. In turn, FINTRAC will welcome feedback from private sector entities to improve the information value of the indicators as they are shared, to support quicker updates to the indicators as criminal methods evolve.

As part of the Countering Extortion Partnership initiative, FINTRAC will share TIP sheets focused on extortion with key financial institutions on a trusted and expedited basis. These profiles will support financial institutions and businesses in understanding and identifying the latest criminal or money laundering practices relevant to extortion and improve the timeliness and quality of suspicious transaction reports to FINTRAC, enhancing FINTRAC's ability to provide actionable intelligence to law enforcement.

Expected outcomes

Private sector businesses with obligations under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act will be able to monitor transactions for extortion-related activity, as informed by early, practical indicators on extortion that have been developed in consultation with key stakeholders and shared through trusted channels.
Canadian businesses in sectors most likely to have visibility on extortion-related financial transactions will be better positioned to detect and report these transactions to inform the financial intelligence that will support law enforcement investigations, and asset forfeiture actions.
FINTRAC will benefit from accelerated private sector feedback on the indicators shared in TIP sheets to update typologies of money-laundering related to extortion, to keep indicators current for the purposes of business transaction monitoring and share new insights with law enforcement partners.

Conclusion

Suspicious transaction reporting is critical to the financial intelligence that supports law enforcement actions to combat extortion. Through the timely, actionable indicators and typologies provided in Targeted Indicator Profiles, FINTRAC is enhancing the capacity of financial institutions and businesses to detect and report extortion-related suspicious transactions that will inform law enforcement investigations, charges, and forfeiture activities.

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