Real estate professionals in Canada are under increasing pressure to detect financial crime risks, verify source of funds, and document transactions with greater accuracy. This article explores how firms can modernize AML compliance and implement seamless ID and fund verification to align with new FINTRAC expectations in 2025.
Whether you’re a broker, law firm, developer, or mortgage specialist, the message is clear: AML in real estate is no longer optional or reactive – it must be continuous, defensible, and digitally enabled.
AML Risk in Canadian Real Estate
According to the Cullen Commission’s findings, real estate has been used extensively to launder proceeds of crime through:
- Anonymous corporate ownership structures
- All-cash or mortgage-free purchases
- Layered legal or nominee arrangements
- Limited scrutiny on source of wealth and funds
As a result, FINTRAC and provincial regulators now expect:
- Identity verification of buyers, sellers, and intermediaries
- Screening for PEPs and sanctions lists
- Verification of source of funds for high-risk transactions
- Retention of detailed records for compliance audits
Challenges Facing Real Estate Professionals
1. Fast-Moving Transactions
Closings often occur in days, not weeks, leaving little time for thorough due diligence.
2. Multi-Party Workflows
Agents, lawyers, lenders, and title insurers all play a role, but often lack a unified system for compliance.
3. Paper-Based Verification
Manual document checks or emailed PDFs increase human error and audit vulnerability.
4. Increasing Expectations Without Clear Tools
Few real estate platforms offer seamless AML functionality built-in—leaving professionals exposed.
How iComply Helps Canadian Real Estate Professionals
iComply provides a purpose-built compliance platform that streamlines real estate onboarding, risk screening, and documentation across all stakeholders.
1. Identity Verification & Screening
- Verify buyer, seller, or trustee identity via secure, edge-based document checks
- Screen for sanctions, PEP status, and adverse media in real time
- Reduce onboarding friction with a white-labeled portal
2. Source of Funds Verification
- Collect proof of funds documents (bank statements, pay stubs, letters of employment)
- Trigger enhanced due diligence for high-risk geographies or transaction sizes
- Maintain encrypted document trails for FINTRAC review
3. Multi-Party Case Collaboration
- Connect agents, lawyers, and underwriters in a single compliance file
- Assign responsibilities and review logs within the platform
- Avoid duplication and data leakage
4. Audit-Ready Logs and Reporting
- Track all actions taken, documents reviewed, and risk decisions made
- Export audit logs to support FINTRAC reviews or provincial regulator inspections
Case Insight: Vancouver Brokerage
A mid-sized real estate firm in Vancouver adopted iComply to improve due diligence on international buyers. Results:
- Reduced average onboarding time by 60%
- Detected three high-risk entities linked to offshore trusts
- Passed a FINTRAC examination with a favourable rating
What to Expect in 2025
- Mandatory SoF Checks: FINTRAC is expected to formalize source of funds verification as a standard requirement for higher-risk real estate transactions
- Shared Responsibility Models: Regulators may clarify roles and expectations across brokers, lenders, and counsel
- Provincial-Federal Alignment: Expect closer cooperation between real estate councils and federal AML authorities
Take Action
Real estate firms that adopt proactive AML strategies today will be best positioned to grow, protect clients, and weather increasing regulatory scrutiny.
Speak with iComply to see how we help Canadian real estate professionals verify clients, screen for risk, and ensure every transaction is compliance-ready.
