Administrative monetary penalty on Birks Group Inc.

[2026-05-05]

Birks Group Inc., also operating as Birks, a dealer in precious metals and precious stones with retail locations across Canada, was imposed an administrative monetary penalty of $51,562.50 on March 11, 2026, for committing 3 violations. The violations were found during the course of a compliance examination. Birks has appealed the decision to the Federal Court.

Nature of violation

Violation #1

Failure 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 Act, subsection 9.6(1) and Proceeds of Crime (Money Laundering) and Terrorist Financing Regulations, paragraph 156(1)(b)

FINTRAC determined that Birks’ policies and procedures failed to document key regulatory requirements. Specifically, Birks did not include requirements to verify the existence of corporations or entities, obtain beneficial ownership information, define business relationships, conduct ongoing monitoring, make determination and keep records on politically exposed persons and heads of international organizations, or comply with Ministerial Directives. Additionally, FINTRAC determined that Birks had incomplete documentation of its reporting requirements, such as the failure to outline its obligation to submit large virtual currency transaction reports and to document its 24-hour rule on how to aggregate transactions, which applies to both large cash and large virtual currency transactions.

Violation #1 is classified by the regulations as a Serious violation. The imposed penalty takes into account the criteria in section 73.11 of the Proceeds of Crime (Money Laundering) and Terrorist Financing Act and section 6 of the Proceeds of Crime (Money Laundering) and Terrorist Financing Administrative Monetary Penalties Regulations.

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 Act, subsection 9.6(1) and Proceeds of Crime (Money Laundering) and Terrorist Financing Regulations, paragraph 156(1)(c)

FINTRAC determined that Birks’ risk assessment failed to meet the legislated requirements because the analysis of money laundering and terrorist financing risks for each prescribed factor was incomplete:

• Clients and business relationships: Birks did not include key elements in its assessment of client and business relationship risks. Specifically, it failed to address high-risk business relationships or activities, such as clients who are politically exposed persons (PEPs), heads of international organizations (HIOs), or entities for which beneficial ownership information could not be obtained. Additionally, Birks did not provide a rationale for its risk scores nor document enhanced measures to mitigate risks associated with clients or business relationships identified as high risk.
• Products, services, and delivery channels: Birks did not provide a rationale or risk rating for all the products, services, and delivery channels it offers. Furthermore, there were no documented enhanced measures to mitigate factors identified as high risk in these areas.
• Geographic location: Birks did not consider the risks associated with all major cities where it operates, nor did it assess the risks related to the geographic location of its customers and transactions. This includes failing to consider risks when funds are received from high-risk jurisdictions or when a customer has a material connection to a high-risk country.

Violation #2 is classified by the regulations as a Serious violation. The imposed penalty takes into account the criteria in section 73.11 of the Proceeds of Crime (Money Laundering) and Terrorist Financing Act and section 6 of the Proceeds of Crime (Money Laundering) and Terrorist Financing Administrative Monetary Penalties Regulations.

Violation #3

Failure of a person or entity to carry out and document the results of the prescribed review every two years by an internal or external auditor of the entity – Proceeds of Crime (Money Laundering) and Terrorist Financing Act, subsection 9.6(1) and Proceeds of Crime (Money Laundering) and Terrorist Financing Regulations, subsection 156(3)

FINTRAC determined that Birks exceeded the two-year requirement to conduct and document the results of the prescribed review to test the effectiveness of its policies and procedures, risk assessment and training program. Specifically, Birks started its last effectiveness review in 2021 and began its next review in 2024, which was beyond the prescribed two-year timeframe required by the Proceeds of Crime (Money Laundering) and Terrorist Financing Act.

Violation #3 is classified by the regulations as a Serious violation. The imposed penalty takes into account the criteria in section 73.11 of the Proceeds of Crime (Money Laundering) and Terrorist Financing Act and section 6 of the Proceeds of Crime (Money Laundering) and Terrorist Financing Administrative Monetary Penalties Regulations.

Related link

• News release: FINTRAC imposes an administrative monetary penalty on Birks Group Inc.