It’s Not Just a “Paperwork Issue”

FINTRAC doesn't just rejects outright; it delays

Few reasonably filled-out MSB applications are outright rejected by FINTRAC. Instead, applications can sit in review for weeks or months while the regulator silently delays the application and prepares to request additional documents or clarification. This silence often creates confusion for founders who assume that no news is good news.

Delays are a signal, not silence

If you haven’t received a response, unless there is a back-log of applications, it usually means your application has raised a concern. FINTRAC may be evaluating your compliance program, your ownership structure, or the qualifications of your appointed CAMLO.

The Top Reasons FINTRAC Is Delaying Your MSB Application

Weak or Incomplete Compliance Program

Missing policies or vague procedures

A generic compliance program won’t cut it. If your policies don’t match your actual business activities—or if key elements like suspicious transaction reporting or red flag indicators are missing—you can expect a hold.

No effectiveness review or audit trail

Even before you launch operations, FINTRAC expects evidence that your AML program has been tested or reviewed. An outdated, untested policy is a red flag.

Related: Effectiveness Review

Unqualified or Conflicted CAMLO

FINTRAC checks who your CAMLO is

Your Chief AML Officer (CAMLO) must be credible. If they lack AML experience, or if they are also your CEO, CTO, and only shareholder, FINTRAC may delay your file due to perceived conflicts of interest or lack of independence.

Related: CAMLO/MLRO Services

Outsourced CAMLOs need context

Hiring an external CAMLO is fine, but only if that person understands your business model. A disconnected compliance officer is a liability, not a solution.

Unclear Ownership or Foreign Control

FINTRAC scrutinizes control structures

Ownership matters. If your MSB is foreign-owned, structured via shell entities, or lacks transparency in beneficial ownership declarations, FINTRAC will pause your application until they understand who’s really in charge.

Shell structures raise red flags

If your entity structure looks engineered to obscure control or tax exposure (e.g., a Delaware LP owning a BVI company owning a Canadian MSB), be ready for enhanced due diligence.

Crypto, FX, and High-Risk Models

Risky business = deeper review

Certain models, especially crypto asset services, high-volume FX, or remittance, automatically trigger a more in-depth review. This doesn’t mean you’ll be rejected, but it does mean you’ll need a more robust compliance program.

Related: Crypto MSBs in Canada: Registration, Monitoring, and Risk Management Essentials

What You Can Do to Unblock the Application

Preempt FINTRAC’s Questions

Submit a complete, tailored AML program

Customize your compliance program to your exact business model. Include reporting procedures, client onboarding processes, red flag examples, and risk assessment logic tied to your products and markets.

Provide CAMLO credentials and training logs

Show that your CAMLO is qualified and prepared. Add their resume, past experience, and any recent AML training or certifications to the submission.

Respond Promptly and Proactively

Treat FINTRAC follow-ups like audits

When FINTRAC requests more information, it’s not a formality. Sloppy or delayed answers can stall your file indefinitely. Respond clearly, with documentation.

Be ready to update your docs mid-process

If FINTRAC flags issues in your policies or procedures, edit and return them quickly. Pushback or delay will only hurt your timeline.

Consider Third-Party Guidance

Expert review = fewer surprises

Having your application or AML program reviewed by specialists can catch issues before FINTRAC does. This includes clarity of ownership, strength of controls, and the independence of your compliance officer.

Related: MSB Registration
Related: Regulatory Remediation

Final Thoughts: Delays Are Fixable, But Not If You Wait

FINTRAC delays are often solvable

Most delays stem from avoidable issues. Generic documents, vague ownership, or an unqualified CAMLO are correctable, but only if you act.

AML Incubator helps unblock FINTRAC timelines

We support MSBs at every stage of registration and compliance, from program design and effectiveness reviews to CAMLO placement and bank onboarding.

Get started with a registration consultation or effectiveness review to keep your application moving.