Recently, a broker contacted Greater Vancouver REALTORS® asking us if members offering mere posting services were subject to FINTRAC requirements.

A mere posting is a listing on the MLS® system where a member has chosen or agreed not to provide services to a seller other than submitting the listing for posting on the MLS® system.

FINTRAC has communicated to Canadian Real Estate Association (CREA) that brokers solely offering mere posting services are not covered by the FINTRAC Regime.

We asked Simon Parham, CREA general counsel and board secretary, for clarification. Here’s his response. 

CREA’s understanding of mere poster obligations under Canada’s FINTRAC Regime hasn’t changed and is explained in Q38 and Q39 (Q40 and Q41 in the 2017 version) of the FAQs. (see below)

FINTRAC’s interpretation with respect to mere posters is not related to CREA By-Laws and Rules, Board Rules or REALTOR® rules of cooperation. It is based on FINTRAC’s interpretation of the Proceeds of Crime (Money Laundering) and Terrorist Financing Administrative Monetary Penalties Regulations.

In a nutshell, FINTRAC has interpretated that Regulation in a way to mean that mere posters are not acting as “agents” within the meaning of the regulations. As a result, they are not subject to the regime.

FINTRAC has maintained this position for over 10 years despite CREA’s efforts to highlight that this creates a loophole in the law and treats brokerages differently depending on the building model they choose to adopt. It’s something we continue to lobby against, to this day.

That said, as explained in CREA’s FAQs, mere posters who provide additional services run the risk of being caught by the law.

See also FINTRAC policy interpretation PI-6225: Obligation in regard to Real estate broker or sales representative. 

Q38: What are the identification obligations with respect to sellers who use mere posting services?

A: FINTRAC has informed CREA that agents and brokers that take mere posting listings are not subject to the PCMLTFA. Accordingly, buyers’ agents should treat mere poster sellers as unrepresented and make reasonable efforts to verify the identity of the seller. However, an agent’s obligation to identify a mere posting seller is less onerous than the requirements to identify their own client. Specifically, an agent only needs to take reasonable measures to obtain ID with a mere posting seller. FINTRAC has advised these measures include asking for ID – whereas when an agent is representing a client, they are required to obtain the ID.

Q39: If a mere poster agent or broker provides additional services, such as adding a lockbox to the door of a property, do they become subject to the PCMLTFA? What should an agent or broker do in such circumstances?

A: FINTRAC has communicated to CREA that brokers that solely offer mere posters services are not covered by the PCMLTFA. However, FINTRAC has also indicated that should a mere poster agent or broker provide additional services the agent/broker may become subject to the regime. Unfortunately, FINTRAC has refused to provide any guidance as to what additional services have to be provided in order this to occur. Instead FINTRAC has indicated each circumstance will be treated on a case-by-case basis. In light of this uncertainty, there are steps that agents and brokers representing buyers can take in order to mitigate any risk to them: the conservative approach and the not-conservative approach. The conservative approach would be for the agent/broker representing the buyer to treat the seller as unrepresented (i.e. take reasonable measures to verify the identity of seller). Doing so ensures the agent/broker is complying with any potential PCMLTFA obligations. The not-conservative approach is to do nothing and assume that FINTRAC will eventually come to the conclusion that the agent/broker posting the listing is covered under the PCMLTFA. Doing so runs the risk that FINTRAC will disagree with this decision and determine that the broker/agent representing the buyer should have attempted to ID the seller. Therefore, if this option is selected, it would be prudent to at least document why the agent/broker is not taking reasonable measures to verify the identity of the seller. This can be kept to show FINTRAC the agent/broker representing the buyer is doing their due diligence. Similarly, the agent/broker representing the seller can take a conservative approach (i.e. assume the brokerage is covered by the PCMLTFA and comply with all the traditional FINTRAC obligations) or the not-conservative approach (i.e. assume the brokerage is not covered by the PCMLTFA and do nothing). Such agents/brokers should be aware, however, that should they take the not conservative approach and FINTRAC comes to the conclusion that they are covered by the law, they face the potential for steep penalties.

Read CREA’s FINTRAC Information for REALTOR® Members FAQs (2023). (Opens 40-page pdf.)

Visit CREA’s FINTRAC Resources website.

If you have questions, contact FINTRAC at F2R@fintrac-canafe.gc.ca or call 1-866-346-8722