Administrative monetary penalty on Argosy Securities Inc.
From: Financial Transactions and Reports Analysis Centre of Canada (FINTRAC)
[2025-02-13]
Argosy Securities Inc., an independent wealth management firm in Richmond Hill, Ontario, considered a securities dealer, was imposed an administrative monetary penalty of $66,000 on September 12, 2024, for committing 3 violations. The violations were found during the course of a compliance examination. The administrative monetary penalty has been paid in full and proceedings have ended.
Nature of violation
- Violation #1
-
Failure of a person or entity to develop and apply written compliance policies and procedures that are kept up to date and, in the case of an entity, are approved by a senior officer – Proceeds of Crime (Money Laundering) and Terrorist Financing Regulations, paragraph 156(1)(b)
FINTRAC determined that Argosy Securities Inc.’s compliance policies and procedures do not comply with the requirements of paragraph 156(1)(b) of the Regulations. Overall, Argosy Securities Inc. did not document and apply the necessary measures in its compliance policies and procedures to meet all of its obligations under the Act and associated Regulations.
FINTRAC’s examination determined that Argosy Securities Inc. did not sufficiently develop and document its compliance policies and procedures in relation to know your client requirements and record keeping. Also, Argosy Securities Inc. had insufficient ongoing monitoring measures for its business relationships. In addition, these requirements were not applied at all times. Furthermore, the reporting timeframes for submitting suspicious transactions or attempted suspicious transactions and terrorist property reports were not accurately documented. Finally, its policies and procedures did not reflect measures required to meet the requirements related to ministerial directives.
- Violation #2
-
Failure of a person or entity to assess and document the risk referred to in subsection 9.6(2) of the Act, taking into consideration prescribed factors – Proceeds of Crime (Money Laundering) and Terrorist Financing Regulations, paragraph 156(1)(c) and subsection 156(2)
FINTRAC’s examination determined that Argosy Securities Inc.’s risk-based assessment was incomplete as it did not clearly outline the risks associated with its clients and business relationships. In addition, the risk assessment did not document an adequate methodology for the assessment of its money laundering and terrorist financing risks, nor did it include a rationale to support the risk levels determined by the organization. Furthermore, Argosy Securities Inc.’s risk assessment did not reflect other relevant factors such as the risks associated with its specific business model.
- Violation #3
-
Failure to institute and document the prescribed review – Proceeds of Crime (Money Laundering) and Terrorist Financing Regulations, paragraph 156(1)(f) and subsection 156(3)
FINTRAC’s examination determined that Argosy Securities Inc. failed to adequately institute and document the prescribed review of its policies and procedures, risk assessment and training program. Specifically, the scope of the prescribed review did not cover the risk assessment. Furthermore, the prescribed review did not specify how the organization ensured that its compliance program was tested for effectiveness, nor did it demonstrate how the deficiencies identified from previous effectiveness reviews were addressed.
FINTRAC’s examination also determined that the effectiveness review was not conducted within the prescribed timeframes.
Related link
- Date Modified: