Ottawa to overhaul financial-crime laws in new border security bill
The federal government is aiming to overhaul Canada's financial-crime laws, including new restrictions on large cash transactions to curb money laundering.
A border security bill tabled Tuesday by Prime Minister Mark Carney's Liberal government includes a number of measures intended to disrupt the flow of money from illicit activities through the financial system. The changes are the latest in a string of announcements from Ottawa aimed at reinforcing border measures with the United States after President Donald Trump said that Canada has not done enough to stop illegal crossings and fentanyl trafficking.
Among the measures is a ban on businesses other than financial institutions accepting cash payments of $10,000 or more. The new legislation also introduces significant increases to the fines that companies can face for failures in their anti-money-laundering controls. Those increases were first announced in the fall economic statement late last year, prior to the April federal election.
Border bill would give authorities sweeping security powers and restrict asylum claims
Editorial: Trump crosses the line on the U.S.-Canada border
The legislation was introduced ahead of a review of Canada's anti-money-laundering regime by the Financial Action Task Force (FATF) slated for this fall. The task force is an international, intergovernmental organization that sets standards for combatting money laundering and terrorist financing, and that seeks to ensure that those standards are effectively implemented through a process of mutual country evaluations.
'There is a spotlight because we have the FATF review, but now there's more of a spotlight because of the new U.S. administration that is very focused on their mandate on cross-border financial crime and the impact of money laundering,' Borden Ladner Gervais financial services lawyer Suhuyini Abudulai said in an interview.
Countries that are found to be deficient in managing financial crime risks are added to the task force's grey list, which can have serious negative consequences for a country, such as curtailing foreign investment into it.
Alana Scotchmer, a partner who specializes in financial services regulation at Gowling WLG, said the amendments to Canada's financial-crime laws will need to be implemented swiftly if they are to be factored in to the FATF review.
'Now that we are on the eve of the next evaluation, making a lot of these changes and cleaning up a lot of the things that need to be cleaned up is a more urgent exercise,' Ms. Scotchmer said.
Jessica Davis, president and principal consultant of advisory firm Insight Threat Intelligence, said legislation that prohibits non-financial-institution businesses from accepting large cash payments is intended to make it more difficult for criminals to introduce dirty money into the financial system – a process known as placement that is the first stage of money laundering.
'You can't do a $10,000 cash buy into the casino any more. If you have $10,000 in cash and you want to take it to a casino, you have to take it to a bank first,' Ms. Davis said.
The bank would then have to transmit the funds to a casino – through a wire transfer, for instance.
'Will this stop money laundering? Of course not, but it will push it so that the placement stage of money laundering is going to be happening in financial institutions, which in theory are best placed to be catching this kind of stuff, because they're going to have the full client history,' she said.
The European Union recently announced an EU-wide cap of €10,000 (about $15,600) for cash payments to make it more difficult for criminals to launder money.
Canada's new legislation also increases the administrative monetary penalties (AMP) for businesses that violate anti-money-laundering laws – a change that experts have long advocated. The maximum penalty for a violation would be $4-million if the violation is committed by a person and $20-million if committed by an entity.
Ottawa has become increasingly critical of Canada's anti-money-laundering practices, putting pressure on the Financial Transactions and Reports Analysis Centre of Canada to crack down on financial crimes.
'You've certainly seen in the last few years more public communication from FinTRAC with respect to their AMP activities and enforcement,' Ms. Abudulai said.
While Canadian regulators take enforcement seriously, certain U.S. regulators are known for their determination in levying fines, even for first-time violations, she said.
'Whereas here in Canada, we have some idea – in terms of certain violations – that there may be some flexibility that they may not necessarily receive an AMP immediately, and maybe it's just a matter of discussions with the regulator to address the matter,' Ms. Abudulai said.
In May, FinTRAC imposed its largest-ever monetary penalty on Toronto-Dominion Bank – nearly $9.2-million – after a compliance examination found the lender had gaps in its anti-money-laundering controls. In late 2023, the financial crimes watchdog also fined Canadian Imperial Bank of Commerce and Royal Bank of Canada for anti-money-laundering failings.
The penalties pale in comparison to the hefty fines and restrictions levied by U.S. regulators and law enforcement. In October, Toronto-Dominion Bank was fined more than US$3-billion and was dealt a host of non-monetary penalties after becoming the first lender in U.S. history to plead guilty to conspiracy to commit money laundering.
'I am interested to see, following all of these changes relating to FinTRAC enforcement powers, how FinTRAC actually uses these powers that it's being given,' Ms. Scotchmer said. 'The question for me is: Are all these added tools and added powers on the enforcement side going to lead to more enforcement activities, different enforcement activities? And I think we will need some time to see how that plays out.'
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
CTV News
38 minutes ago
- CTV News
‘We love you, come on down,': Business owner's message to Canadians boycotting U.S. travel
FILE - American and Canadian flags fly near the Palace Playland amusement park, Wednesday, April 2, 2025, in Old Orchard Beach, Maine, a summer seaside resort town popular with French-Canadian tourists. (AP Photo/Robert F. Bukaty, File( As the summer tourism season heats up and some Canadians choose to boycott U.S. travel, New England states and business owners want to draw Canadian tourists back. Maine's rugged coastline and sandy beaches have helped to earn it the license plate slogan 'Vacationland.' But this year, fewer Canadians are showing up. David Rowland, co-owner of York Beach Beer Company, has noticed fewer Canadian license plates and fewer Canadian surfers in York Beach. 'Down here at Long Sands Beach, it's usually lined with Quebecois or New Brunswick (tourists), and they're not here. Some are. But not like normal,' he said. 'We still have great beer and we're still nice people. And we have great waves and great mountains,' Rowland said. 'I would say, don't be afraid of us. We're not afraid of you. We're sorry.' From February to May, land crossings into Maine were down 27 per cent compared to last year. Other northeast states feel the drop of Canadian travellers too. At a summit in between northeast U.S. governors and Eastern Canadian premiers in Boston earlier this week, Massachusetts Governor Maura Healey told reporters her state expects to see a 20 per cent decline in bookings. 'Vermont reports that hotel reservations by Canadians are down 45 per cent. Credit card spending by Canadians down 36 per cent. In New York City, bookings by Canadians are down 45 per cent,' said Governor Healey. Democratic governors blame U.S. President Donald Trump's rhetoric, after he repeatedly said he wanted to make Canada the 51st state. Trump also imposed tariffs on Canadian goods, including steel and aluminum. Maine's Governor Janet Mills said she's spoken with a bed and breakfast owner whose business has welcomed Canadians for generations but is now dealing with cancellations. 'It's not the tariffs that are affecting them so much as the hurt pride and Canadian citizenry,' said Mills. Maine has set up signs to welcome Canadians at border crossings and tourism visitor centres throughout the state. Its governor will travel to New Brunswick and Nova Scotia next week to meet with premiers, but also to promote her state as a destination. A Leger poll from May found that while Canadians' summer travel intentions are 'strong,' interest U.S.-bound travel this summer is 'collapsing' as only 10 per cent plan to travel to the U.S. this summer, down from 23 per cent last year. The poll also said 75 per cent of those polled who were planning a trip to the U.S. say tariffs announcement influenced their plans. More than half who had planned to visit the U.S. now plan to travel elsewhere. Other factors such as safety concerns, poor exchange rates, not feeling welcome and concerns about border delays also influenced their decisions. How the drop in Canadian tourism is impacting businesses varies depending on who you ask. At The Nevada Hotel in York Beach, Maine, its manager Valerie Fedorchak said they welcome guests from all over the world. Their Canadian guests are still coming. 'I'm really grateful to be able to say that we haven't noticed a substantial impact,' said Fedorchak. Typically, in Old Orchard Beach, Maine, Canadians account for up to 40 per cent of tourists each year. When announcing how Canada would respond to Trump's tariffs In March, former prime minister Justin Trudeau singled out Old Orchard Beach and Florida as places Canadians would choose to avoid. Family-run businesses like the Sandpiper Beachfront Motel welcome regulars from Canada every year, especially from Quebec. For some families, it's a 40-year tradition. 'For us personally we've only had a maybe a handful of people cancel if that,' said manager Michael Rioux, noting their longtime repeat clientele are still coming except one family that gave up seven rooms at the end of July. Rioux said the guest didn't want to cancel but her family did. 'Given the political situation, they wanted to boycott the U.S.,' he said. Rioux said his brother's business has also been dealing with more Canadian cancellations. He thinks the exchange rate, coupled with political turmoil will impact tourism in Old Orchard Beach. 'It's sad, because Canadians lose out on one of their places to go and then the mom and pop places like us lose as well,' Rioux said. Suzanne Ellis, the owner of Johnny Shucks Maine Lobster said the season started off slow, but she's noticed more Canadians showing up recently, especially this week. Ellis said she's very happy to have them here. The operator had been worried because a lot of her friends in Canada said they wouldn't be coming. Ellis estimates about 60 per cent of her customers are Canadians. 'We want to see you, we love you, come on down,' she said. Rioux message for Canadians is to do what you've been doing every year and enjoy your summer vacation. 'I think a lot of the political stuff is keeps us divided. I think we should stay together and help each other out and not fuel into a lot of the political theater and division that they perpetrate in the media,' said Rioux.
Globe and Mail
an hour ago
- Globe and Mail
What Are the Top 5 Artificial Intelligence (AI) Stocks to Buy Right Now?
Artificial intelligence (AI) has the potential to be the most important technological advancement in history, and it still appears to be in its early innings. As such, the space is still one of the most promising places to invest. When delving down to specific stocks to focus attention on, five of the best AI-related offerings to buy right now are Nvidia (NASDAQ: NVDA), Broadcom (NASDAQ: AVGO), Taiwan Semiconductor Manufacturing (NYSE: TSM), Palantir Technologies (NASDAQ: PLTR), and GitLab (NASDAQ: GTLB). Each company has found a unique niche in the AI sector to exploit, and each has big opportunities ahead. Let's look at why these are among the best AI stocks to invest in right now for the long term. 1. Nvidia Nvidia's graphics processing units (GPUs) have become the backbone of AI infrastructure. These powerful chips are used to help power AI workloads, and demand has been soaring. The company's wide moat, however, comes from its CUDA software platform. Nvidia launched CUDA two decades ago to allow developers to program its GPUs more easily. It pushed CUDA into universities and research institutions early on, which helped CUDA become the de facto software program for AI developers. In Q1, the company had an over 90% market share in the GPU space. As a result, where AI infrastructure spending goes, Nvidia is sure to follow. While a slowdown in data center spending would be a risk, right now, demand for AI chips is only getting bigger. This is being driven by cloud computing companies pouring money into AI infrastructure to keep up with demand; large tech companies and AI start-ups spending big to create new foundational AI models; and even countries making large investments to not fall behind in the AI race. As AI infrastructure spending continues to ramp up, Nvidia remains a clear winner. 2. Broadcom Another company taking advantage of the AI infrastructure build-out is Broadcom. Rather than designing GPUs like Nvidia, it's been focused on networking components and helping customers design custom AI chips. It also added a software component when it acquired VMWare. Thus far, its strategy is paying off. Its Ethernet switches and other networking components help efficiently move data within huge AI clusters, making them an essential part of data center infrastructure. Last quarter, its AI networking revenue soared 70% and accounted for 40% of Broadcom's total AI revenue. However, Broadcom's biggest long-term opportunity comes from helping customers design custom AI chips, which can offer better performance and lower power consumption than off-the-shelf GPUs. Demand is starting to pick up. Broadcom says its top three custom chip customers are on track to deploy 1 million AI chip clusters each by 2027, representing a total opportunity of between $60 billion to $90 billion. On the software side, Broadcom also benefits from transitioning VMWare customers from perpetual licenses to a subscription models and upgrading them to its VMware Cloud Foundation (VCF) platform. VCF helps customers build hybrid and multi-cloud environments so they can manage workloads across public clouds and their own on-premises data centers. At the end of last quarter, 87% of its top 10,000 customers had adopted VCF. While an AI infrastructure spending slowdown is a risk, given its networking leadership, custom AI chip opportunity, and growing software revenue, Broadcom is well-positioned moving forward. 3. Taiwan Semiconductor Manufacturing While semiconductor companies garner most of the attention from investors, Taiwan Semiconductor Manufacturing is the company that actually manufactures most of these AI chips. It's the clear leader in advanced semiconductor manufacturing and a key partner to top customers like Nvidia, Apple, and Broadcom. Meanwhile, AI is driving its business. High-performance computing now makes up 59% of its revenue, up from 46% a year ago. Most of that comes from advanced nodes. Nodes refer to the manufacturing process used to make chips. The smaller the number (measured in nanometers), the more transistors you can pack onto a chip. This improves a chip's performance and power efficiency, and TSMC is the best in the world at making these at scale. And with rivals struggling to make advanced chips, this has given TSMC strong pricing power, as well. The biggest risk to TSMC is a slowdown in AI infrastructure spending, which would hit both revenue and fab utilization. However, the company is working closely with its largest customers to build out capacity in lockstep with their demand. With advanced-node capacity tight, TSMC is well-positioned to continue to be an AI infrastructure build-out winner. 4. Palantir Technologies Palantir Technologies has emerged as a key player in the AI space. Instead of putting resources into developing AI models, the company focuses on the applications and workflow layers of AI to essentially develop an AI operating system. It does this by gathering data from a wide array of sources and organizing it into an ontology that links the data to its real-world counterparts. As a result, the company's AI Platform (AIP) can help organizations solve complex problems. This includes everything from monitoring sepsis in hospitals to streamlining underwriting processes in insurance. The sheer number of use cases across various industries that AIP can handle is just an enormous opportunity for Palantir moving forward. The company saw its revenue growth consistently accelerate over the past two years, including a 39% increase last quarter. The stock is not without risks, as it carries a high valuation and is exposed to government budget cuts, since the federal government is still its largest client. However, Palantir is unique in the AI space and has one of the biggest opportunities in front of it. 5. GitLab GitLab is a leader in the DevSecOps space, offering a platform that helps developers build software securely. It's been an AI winner, as customers expand seats and upgrade to its higher-tier platforms as AI increases the customers' software development. GitLab is also helping customers become more productive with products like GitLab Duo, which uses AI to provide code suggestions and automation to streamline development. The company consistently delivered strong revenue growth of between 25% to 40% over the past two years and boasts impressive gross margins and solid free cash flow. It's also done a great job growing within its existing customer base, as evidenced by its 122% dollar-based net retention over the past 12 months. Most of this is coming from seat expansions, followed by strong upgrades to higher-tiered offerings. While there has been concern that AI will replace coders, right now the opposite has been true, as GitLab's technology is being used to make software developers more productive, not replace them. This is driving strong growth and makes the company look like a solid long-term winner. Should you invest $1,000 in Nvidia right now? Before you buy stock in Nvidia, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Nvidia wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $659,171!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $891,722!* Now, it's worth noting Stock Advisor 's total average return is995% — a market-crushing outperformance compared to172%for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of June 9, 2025
Globe and Mail
an hour ago
- Globe and Mail
2 Top Stocks to Buy Now at Big Discounts and Hold for Years
Sometimes Wall Street can be very slow to understand the real value of a business. The competitive advantage and growth strategy of a company can be misunderstood, leading to depressed valuations and underperforming share prices. Investors who can see through the stock volatility and focus on the key signals that set a company up for long-term success can be rewarded with outsize gains over time. Here are two stocks of market-leading brands that are trading well off their previous highs and could be significantly undervalued. 1. RH RH (NYSE: RH), the company formerly known as Restoration Hardware, emerged as a prominent luxury furniture brand over the past decade. In the past year, however, the business struggled with several macroeconomic headwinds, such as a weak housing market and uncertainties over tariffs. Questions about near-term demand have sent the stock down 52% this year, but this is a great buying opportunity for a long-term investor. RH's trailing-12-month revenue of $3.3 billion is below its previous peak of $3.9 billion a few years ago, but it just reported a strong first quarter. Revenue grew 12% year over year in the quarter, outperforming the rest of the industry. RH is expanding its addressable market to hospitality offerings in its design galleries, such as restaurants and wine bars, which has elevated the shopping experience to something that cannot be replicated by e-commerce competitors. Moreover, the company entered the $200 billion North American hotel industry with RH Guesthouses, and it offers much more, including private jets and luxury yachts for charter in the Caribbean and Mediterranean. All this creates an ecosystem of services meant to showcase the RH lifestyle and raise the brand to something more than just furniture products. It's for these reasons that RH has a history of reporting much higher margins than the average furniture store. Its adjusted operating margin was 7% in the first quarter, below its previous 10-year average of 12%. It should return to those higher margins in a strong housing market, and this is not reflected in the stock's valuation. Over the last 10 years, the stock traded at a price-to-sales multiple ranging from 0.48 to 6.59. The average was just over 2 times sales, with the stock currently trading at a multiple of 1.16. Investors who buy shares at these lower discounted prices and hold until the housing market is fully recovered should be well rewarded. 2. Roku Roku (NASDAQ: ROKU) is another beaten-down stock whose long-term prospects are not fully reflected by its current share price. The stock is trading about 32% below where it was five years ago, but the platform continues to show double-digit growth in revenue that sets up a potential bull run. Roku is a leading connected-TV streaming platform that is benefiting from a growing digital advertising market, which is how the company generates most of its revenue. It also gets a small percentage of revenue from selling its streaming devices, but that is a low-margin business. Advertising can be cyclical with the broader economy, and that's what caused the stock to collapse a few years ago. But Wall Street is missing the real value of the company's platform. It is fundamentally a TV operating system that has achieved tremendous viewership in the U.S. through its affordable Roku TVs and streaming devices. The company reaches half of U.S. broadband households. This large viewership led to 35.8 billion total streaming hours on its platform in the first quarter, representing a year-over-year increase of 16%. This opens up a lot of opportunities for growth over the long term, as evidenced by a recent deal with Amazon. Roku just announced an integration with Amazon Ads, which could have a significant impact on Roku's advertising revenue. This partnership will allow advertisers to access 80% of U.S. connected TV households through Amazon's demand-side platform, sending more business to Roku. The streamer's revenue grew 16% year over year in the first quarter, indicating more advertising by big brands that want exposure to its large user base. This reach provides tremendous negotiating power with content providers, retail brands, and other media companies that would like access to Roku's audience. The stock is priced at a 2.74 price-to-sales multiple, which is at the low end of its past trading range. As Roku continues attract more advertising investment, investors who patiently hold the stock will be rewarded. Should you invest $1,000 in RH right now? Before you buy stock in RH, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and RH wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $659,171!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $891,722!* Now, it's worth noting Stock Advisor 's total average return is995% — a market-crushing outperformance compared to172%for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of June 9, 2025 John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. John Ballard has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon and Roku. The Motley Fool recommends RH. The Motley Fool has a disclosure policy.
