Navigating New AML Regulations in Mortgage Brokering with Dave Teixeira

In a critical update for the mortgage industry, Dave Teixeira joins host Len Lane to clarify the recent AML regulations. Dave highlights the importance of these rules in strengthening the role of mortgage brokers in Canada’s financial system and explains the operational challenges of ongoing compliance. He illustrates how DLCG is supporting brokers with tools to manage enhanced ID verification, risk assessments, and transaction monitoring while discussing the vital role of technology especially the Velocity platform.

The conversation also touches on the intricacies of the regulatory landscape, including the importance of ongoing media monitoring and understanding the distinction between suspicious transaction reports (STRs) and other compliance documentation. Dave’s expertise offers mortgage professionals a roadmap to efficiently navigate AML requirements while ensuring top-notch client service. This episode is a must-listen for mortgage brokers, industry professionals, and those interested in regulatory compliance within financial services.

About Dave Teixeira

Dave Teixeira is the Executive Vice President of DLCG Operations. Since joining DLC in 2015, Dave has played a vital role in managing partnership relationships, overseeing media and government relations, and leading special projects. Known for his collaborative approach, Dave works closely with third-party partners, and his title accurately represents the wide range of operational functions he contributes to DLCG.

Resources discussed in this episode:

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Contact Len Lane | Brokers for Life:

Contact Dave Teixeira | Dominion Lending Centres:

Website: DaveTeixeira.ca

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Transcript

Len 00:02

Welcome. My name is Len Lane, and I am the founder and president of Brokers for Life Inc, and we are Dominion Lending Centers in Western Canada. The topic of our podcast will be about what we consider to be Real Life Mortgage Solutions.

Len 00:18

Welcome back if you’re listening to this today, on the day it’s been released, it should be December 10, 2024 we will be taking a short break over the Christmas season, as the next podcast would have come out on Christmas Eve. So, you will hear back from us on January 7th with a new set of podcasts for you to enjoy. Have a great Christmas season, and we will talk to you in 2025.

Len 00:44

Today, we’re going to talk about a hot subject within the mortgage industry. The letters AML have been tattooed on the back of our hands for the last six or seven weeks. Anti-money laundering, not new to the banking system, but in the recent few months, it has become something of importance within the mortgage industry, and today we’re going to talk to Dave Teixeira, Executive Vice President of operations for DLC group. You don’t know who DLC group is after the 17th podcast, lending group, so David, welcome.

Dave 01:17

Thanks. Len, it’s great to be here, and it’s great to be able to chat now that we’re a little bit on the other side of the AML Regulations now coming into play. I think people are now a bit of a sigh of relief that they’ve gone through that first little bit but always interested to share more about the experience and to see what sort of questions might still be out there.

Len 01:40

Right, exactly. And like I kind of said, it’s like AML is not new. Anti-money laundering has been around for a long time, especially on the banking side. Financial Planners actually it looks like it was enacted in 2006, and FINTRACS itself has been around for over 25 years. So why do you think that it’s now become the mortgage industry’s turn to be involved in this?

Dave 02:03

I think they’ve realized, I think governments have realized, over the last, say, 15 years or so, the key role that mortgage brokers play in Canadians’ lives. And I think that’s a positive, you know, we’ve come from being this kind of fringe utility. You know, it’s nice to have, perhaps, but it’s kind of weird to now being the choice for people to make really good decisions, and we can help Canadians get into the house of their dreams. And so I think what’s happened is, over the last while, regulators and organizations, regulators like FINTRAC, has said, Wait a second, this other group is playing a role here. Why are they not part of it? So, I think it’s part of becoming a more professional organization. And at DLCG, we’ve often welcomed these sort of regulations because it shows that we’re now being taken seriously. And as you pointed out so wisely, these regulations have been part of various industries for a year, everything from casinos and gambling to wealth management to legal professions, real estate. So it’s just kind of our turn, and at the end of the day, I think this is these are going to be really simple regulations to follow. It’s might be a little more difficult to have a process in place unless you have a good technology solution, but it’s, it’s a bit of a curse. They now see us as professional, which means they’re going to regulate us a little more differently and more stringently.

Len 03:24

Right, and that’s definitely part of it. I think the Cullen report, of course, a couple of years ago came out in British Columbia and highlighted a lot of spots. Do you think that was much of a catalyst to point out the mortgage brokering side of it?

Dave 03:40

I think it was independent of what FINTRAC was doing. FINTRAC, the Cullen report came out. I believe it was in late 22 or mid-22, and in early 2023, FINTRAC announced they were going to do something, something in the mortgage industry. Then, in September of 2023, they said, on October 11, 24, various regulations were coming in, and they laid them all out. And I think this is an industry we might have been slow to adopt. I know I was slow, and DLCG were slow to understand the importance. We kind of thought, Oh, this is just enhanced ID verification, not a big deal. And quickly we learned it’s a much bigger deal. So I think the Cullen report in British Columbia, and if anyone out there hasn’t read it, it’s a lovely, 1800-page, breezy read, but they are looking at saving, preserving the housing markets, and making sure that, you know, criminal activity is not part of it, and part of that being anti-money or money laundering, which was apparently a fairly big problem here in British Columbia. I’m not so sure how big it was, but it was enough to merit an 1800-page report. And to that end, I think we’re going to see governments, and even perhaps provincial regulators, get more involved. So, on August 8th of this year, BCFSA. The regulator in British Columbia sent out a kind of a scary email to agents and said, We’re going to be performing desk audits to ensure that you are going to be compliant for FINTRACS…