Verifying the Identity of a Money-Services Business Customer
A money-services business (MSB) must verify the identity of its customers (except for customers using its automated teller machines [ATMs]) before providing a money service to them. The MSB must get the following basic information from each customer:
- the customer's name;
- the customer's address;
- the customer's phone number.
The MSB also has to get additional information from a customer to verify their identity if the customer's transaction is above a certain amount.
An MSB that is unable to verify the customer's identity must refuse to provide a money service under the Money-Services Businesses Act.
The MSB has to get additional information from a customer to verify their identity in the following cases:
- The customer wants to conduct a transaction totalling $3,000 or more involving the issue or redemption of traveller's cheques, money orders or bank drafts.
- The customer wants to conduct a foreign currency exchange transaction totalling $3,000 or more.
- The customer wants to conduct a funds transfer transaction totalling $1,000 or more.
- The customer wants to cash a cheque (regardless of the amount).
An MSB must verify the identity of all customers conducting off-site transactions.
The MSB must verify the identity of all co-contracting parties it deals with in connection with its money-services activities, regardless of the amount or the nature of the contract.
|Personal information||Natural person||Legal person|
|Date of birth||Yes||No|
|Main occupation or nature of professional activities||Yes||No|
|Nature of business activities||No||Yes|
When a third party conducts a transaction on behalf of a customer, the MSB must get the same information from the third party as it does from any other customer. The MSB must also ask for a document that certifies that the third party is authorized to act on behalf of a customer.
The MSB must verify the identity of all co-contracting parties with whom it deals in connection with its money-services activities in the same way it verifies the identity of its other customers.
Customer identity is verified differently for in-person transactions and off-site transactions.
For an off-site transaction, the MSB must collect the necessary information for verifying a customer's identity at the time of the transaction as follows:
- In the case of a natural person, the MSB must ask to see an original of a photo identification document issued by a government (or a government department or agency) that includes the person's name and date of birth. It is strictly prohibited to copy an identification document.
- In the case of a business, the MSB must obtain a confirmation of the business's legal existence (for example, by verifying the business's registration in the Québec enterprise register).
For an off-site transaction, the MSB must collect the necessary information for verifying a customer's identity and then proceed as follows at the time of the transaction:
- The MSB must obtain the account or other document number that the MSB issued to the customer and in respect of which the money-services business has verified the identity according to the applicable regulations.
- The MSB must obtain a confirmation that the customer has a deposit account at a financial institution in respect of which the customer's identity was verified by that institution at the time the account was opened.
- The MSB must obtain confirmation of a transaction using a bank card issued by a financial institution in the name of the customer and in respect of which the customer's identity was verified by that institution at the time the card was issued.