In Canada, reporting entities are businesses and organizations required to follow specific laws under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA). These businesses must meet certain obligations, including reporting transactions that seem suspicious, large cash transactions, and certain transfers.
Quick answer: A reporting entity is a business that must follow Canada's Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA). Reporting entities have to run a compliance program, verify their clients, keep records and send certain reports to FINTRAC, Canada's financial intelligence unit. Banks, money services businesses (MSBs), real estate brokers, accountants, casinos and several other sectors are all reporting entities.
What does "reporting entity" mean?
The term comes from the PCMLTFA. If your business carries out certain financial activities in Canada, the law treats you as a reporting entity, and FINTRAC supervises you. It doesn't matter how small you are. A two-person MSB has the same core obligations as a large one, scaled to its risk.
Being a reporting entity is based on what you do, not what you call yourself. A fintech that sends money on behalf of customers is an MSB in FINTRAC's eyes, even if its marketing calls it a "payments app".
Which businesses are reporting entities in Canada?
FINTRAC currently lists these business sectors:
- Financial entities: banks, credit unions, caisses populaires, trust and loan companies
- Money services businesses (MSBs), including foreign MSBs serving people in Canada: money transfer, foreign exchange, virtual currency dealing, cheque issuing and more
- Securities dealers
- Life insurance companies, brokers and agents
- Real estate brokers, sales representatives and developers
- Mortgage administrators, brokers and lenders
- Accountants and accounting firms, when they carry out certain activities for clients
- British Columbia notaries
- Casinos
- Dealers in precious metals and precious stones
- Agents of the Crown that sell or redeem money orders
- Armoured cars
- Factors, financing or leasing entities and cheque cashers (added April 1, 2025)
- Title insurers and acquirer services for private ATMs (added October 1, 2025)
The list keeps growing. If your sector was added recently, read our guides on the new rules for cheque cashers and title insurers and private ATM acquirers.
What does a reporting entity have to do?
FINTRAC's obligations fall into a few main groups.
1. Run a compliance program
Every reporting entity needs a compliance program with five parts:
- A compliance officer who is responsible for the program. Many businesses call this person the CAMLO.
- Written policies and procedures that are kept up to date and approved by a senior officer.
- A risk assessment of how your business could be used for money laundering or terrorist financing. See what an AML risk assessment covers.
- Ongoing training for staff and agents, with a written training plan.
- An effectiveness review at least every two years, to test whether the program actually works. More on that in why regular effectiveness reviews matter.
2. Know your client
You must verify the identity of clients in specific situations, find out who owns or controls business clients (beneficial ownership), check whether a client is a politically exposed person, and keep monitoring the relationship over time. Our guide to how KYC and AML programs work together explains this in more detail.
3. Report transactions to FINTRAC
Depending on your sector, you may need to file:
| Report | When it applies | Deadline |
|---|---|---|
| Suspicious transaction report (STR) | You have reasonable grounds to suspect a transaction is linked to money laundering or terrorist financing. No minimum amount. | As soon as practicable |
| Large cash transaction report (LCTR) | You receive $10,000 or more in cash, in one transaction or several within 24 hours | Within 15 calendar days |
| Large virtual currency transaction report (LVCTR) | You receive virtual currency worth $10,000 or more, in one transaction or several within 24 hours | Within 5 working days |
| Electronic funds transfer report (EFTR) | An international transfer of $10,000 or more, in one transaction or several within 24 hours | Within 5 working days |
| Listed person or entity property report | You have property owned or controlled by a listed terrorist or sanctioned person | Immediately |
For more detail, see our LVCTR explainer and when to file a suspicious transaction report.
4. Keep records
Reporting entities must keep records of client identification, transactions and reports, usually for at least five years, and be able to hand them to FINTRAC within 30 days if asked.
5. Follow ministerial directives and register if required
The Minister of Finance can issue directives about high-risk countries, and reporting entities must follow them. MSBs also have to register with FINTRAC before they start operating.
What happens if a reporting entity doesn't comply?
FINTRAC examines reporting entities and can issue administrative monetary penalties. Amendments in 2026 raised the maximum penalties sharply and added compliance orders. FINTRAC can also publish the names of businesses it penalizes, which often hurts more than the fine itself, especially with banks. Read FINTRAC's new penalty framework for the details.
How do I know if my business is a reporting entity?
Ask yourself three questions:
- Does my business carry out any of the activities in the sector list above, in Canada or for people in Canada?
- Do I handle, transfer or exchange money or virtual currency for other people?
- Do I act for clients in property purchases, financial transactions or large purchases of valuable goods?
If the answer to any of these is yes, you are probably a reporting entity. The rules have edge cases, so get advice before you launch. Being a reporting entity and not knowing it is one of the most common ways new businesses end up in trouble.
Frequently asked questions
Is every business in Canada a reporting entity?
No. Only businesses in the sectors covered by the PCMLTFA are reporting entities. A regular retailer or software company is not, unless it also carries out a covered activity, such as sending money for customers.
Are crypto businesses reporting entities?
Yes, if they deal in virtual currency. Businesses that exchange or transfer virtual currency are MSBs and must register with FINTRAC and follow all MSB obligations.
Do reporting entities pay FINTRAC?
Some do. FINTRAC charges banks, trust and loan companies and life insurers every year, plus any other reporting entity that files 500 or more threshold reports. See who FINTRAC bills.
Can a reporting entity outsource its compliance?
You can outsource tasks, and even the compliance officer role, but your business stays legally responsible. Many smaller firms use an outsourced CAMLO to get experienced help without a full-time hire.
Need help meeting your obligations?
AML Incubator helps reporting entities across Canada set up compliance programs, register with FINTRAC and pass examinations. Book a free consultation to find out exactly what applies to your business.
