Humber/Ontario Real Estate Course 4 Exam Practice

What is a brokerage required to do under FINTRAC regulations?

1. Verify the identity for every real estate transaction, except those below $200,000 in sale price.

2. Maintain a receipt of funds record for each real estate transaction.

3. Prepare a large cash transaction report for every cash payment of $10,000 or more received in a single transaction.

4. Complete a risk assessment for the brokerage every six months.

5. Submit a report for any wire transfer over $5,000.

6. Verify income sources of clients for all transactions.

The correct answer is: Prepare a large cash transaction report for every cash payment of $10,000 or more received in a single transaction.

The correct approach under FINTRAC regulations for brokerages specifically mandates the preparation of a large cash transaction report for every cash payment received in a single transaction that is $10,000 or more. This requirement is part of the broader set of obligations aimed at preventing money laundering and ensuring the integrity of the financial system. By recording large cash transactions, brokerages not only comply with regulatory expectations but also help to prevent illicit activities by providing transparency and accountability in financial dealings. This requirement serves as a crucial checkpoint to monitor high-value cash transactions that could be indicative of money laundering. Other options do have their own relevance within the scope of FINTRAC, but they do not encompass the definitive requirement laid out for brokerages to file a report on large cash transactions.