By Ken Brander
In the context of the act and regulations, ‘business relationship’ must be understood to mean a ‘high-risk relationship.’ It refers to the risk-mitigation strategy a DPMS reporting entity applies to a supplier or customer for whom the DPMS has submitted two reports (e.g. one large cash transaction report and one suspicious transaction report) during the previous five years.
For instance, if you are a retail reporting entity and ‘Diamond Wholesaler A’ requests you wire the payment for your purchase to an off-shore account belonging to ‘Business B,’ this should trigger a suspicious transaction report (actually this alone may very well bump the supplier to a high-risk business relationship). If it happens a second time in five years, that relationship is deemed a ‘business relationship’ according to the legislation and you now have additional legal responsibilities.
Alternatively, if a retail reporting entity submits one large cash transaction report and one suspicious transaction report about a customer over the course of five years, that customer is deemed to be high-risk and the DPMS has likewise entered into a business relationship.
Ken Brander recently retired after a distinguished 25-year career with the Edmonton Police Service. He specialized in the investigation of fraud, corruption, and money laundering in Canada and internationally. In 2011, Brander spent nine months on the Afghan Threat Finance Cell investigating government corruption and money laundering. He has presented at international conferences and recently completed a contract for the UN Office on Drugs and Crime in Africa. Brander is president and principal consultant at Clarium Fraud and Compliance Solutions Ltd., a firm offering AML compliance products for Canadian DPMSs. He can be reached at www.clariumfcs.com.
