Quebec’s new regulatory regime for money services businesses is coming into effect, bringing regulatory oversight to a previously unregulated sector of the financial industry.
The Autorité des marchés financiers, which will administer the new rules, announced that the Money-Services Businesses Act and its regulations will come into force on April 1 (the act was passed back in December 2010). The new regime will govern businesses that offer services such as currency exchange, funds transfers, cheque cashing, the operation of private automated teller machines, and the issue or redemption of traveller’s cheques, money orders or bank drafts.
Currently in Quebec, over 400 businesses provide money services and there are more than 5,000 private ATMs in operation. Under the new regulatory framework, those businesses must now hold a licence issued by the AMF, in addition to meeting certain obligations such as maintaining records and verifying the identity of customers. If they fail to meet these obligations, or commit any offence under the Act, they may be subject to fines or have their licence revoked, the AMF says.
Businesses that are already operating when the new regime takes effect will have six months to file a licence application with the AMF. And, the section of the act dealing with private ATMs won’t come into force until January 1, 2013.