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Anti-Money Laundering Responsibilities and Transparency Reports
The Land Owner Transparency Act (“LOTA”) came into effect in November 2020 to address B.C. government concerns of money laundering by enhancing visibility into the ownership of land in the province.
As of November 30, 2022, existing reporting bodies who had acquired an interest in land before November 2020 are required to file a transparency report. This newly acquired information will be added to the Land Owner Transparency Registry (“LOTR”) and will be publicly available.
What Licensees Should Know
The new data will assist you with facilitating real estate transactions by providing more information to help you comply with your obligations, including the requirement to “know your client,” a key responsibility under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (“PCMLTFA”) to combat money laundering and terrorist financing in the real estate industry. As part of your responsibilities under PCMLTFA, you must ensure that the information your client provides you corresponds with their identification documents and other information sources, including within LOTR, Land Title records, and the corporate registry where appropriate. Review the Land Owner Transparency Act in BCFSA’s Knowledge Base section for more information.
As covered in BCFSA’s mandatory Anti-Money Laundering in Real Estate course for licensees, the concealment of beneficial ownership information is a technique used in money laundering and terrorist activity financing schemes. Identifying beneficial ownership removes the anonymity of the individuals behind the transactions and account activities, which is a key component of Canada’s anti-money laundering and anti-terrorist financing regime. Find All FINTRAC Guidance on the Government of Canada’s webpage.
Who Is Required to Report Information?
LOTA requires individuals and entities who are reporting bodies to disclose information about themselves and about interest holders who directly or indirectly hold an interest in land. LOTA records are separate from Land Title Office (“LTO”) records. The records are handled by the LOTA administrator and stored in a searchable registry called the Land Owner Transparency Registry, (“LOTR”) which was developed by the Land Title and Survey Authority of British Columbia. Unlike the Land Title Registry, LOTR does not confirm the title or ownership of estates and interests. It is merely a repository of records.
When LOTA was first implemented, the obligation to file a transparency report identifying the individuals who acquired an indirect interest in land only applied to transactions which occurred after November 2020.