Gowling WLG FSxT

📀 "Resurgent" and "Evolving": FINTRAC comments on the {not-just-Bitcoin} virtual currency environment 📈 In its 2023-2024 annual report released yesterday, FINTRAC Canada | CANAFE Canada observed: 📊 Notable increases in transactions on the Ethereum blockchain and transactions involving stablecoins. 🔁 Decentralized finance (DeFi), often associated with disintermediated financial services via asset self-custody, represents one of the fastest growing and most innovative sectors in the crypto economy in Canada. 💸 Bitcoin remains the primary payment method for ransomware. 📰 FINTRAC has received over 240,000 large virtual currency transaction reports (LVCTRs) since 2021. 🔍 As transparency, reporting and compliance increase, adoption invariably follows. 🧐 Curious how engaging with virtual currency can impact your business? Contact Gowling WLG FSxT and read more 👇 Gowling WLG | Adam Garetson | Alana Scotchmer | Hyunju (Crystal) Park | J. Quinn Clement-Schlimm

🚀 More updates from the Office of the Superintendent of Financial Institutions Canada (OSFI)! 📢 In its Fall Quarterly Release, OSFI unveiled new risk guidelines, adjusted mortgage standards, and made changes to ease regulatory burden. These updates aim to streamline and strengthen regulatory and supervisory oversight, ensuring a safer and more efficient financial environment. 🏦💼 Key release highlights include: 📍 Minimum Qualifying Rate (MQR) industry letter, confirming that MQR is no longer required for uninsured straight switches at renewal. 📍 Revised Regulatory Notice on Commercial Real Estate (CRE) Lending, including expectations around forbearance practices for CRE lending. 📍 Regulatory Notice on Culture Risk Management, setting out expectations for managing culture risk in areas of governance and enterprise-wide culture management.  📍 Final Liquidity Adequacy Requirements (LAR) Guideline. 📍 Final Life Insurance Capital Adequacy Test (LICAT) Guideline. 📍 Final Mortgage Insurer Capital Adequacy Test (MICAT) Guideline. 📍 Final International Financial Reporting Standard (IFRS) 17 Guideline. OSFI also announced its plan to rescind 20 existing guidelines and regulatory advisories as of April 1, 2025. Stay tuned for more insights and join the virtual Quarterly Release Industry Day on December 5, 2024, for further details! 📅💡 Gowling WLG | Alana Scotchmer | Natalia Castro

📢 𝐈𝐀𝐈𝐒 𝐏𝐮𝐛𝐥𝐢𝐬𝐡𝐞𝐬 𝐃𝐫𝐚𝐟𝐭 𝐀𝐩𝐩𝐥𝐢𝐜𝐚𝐭𝐢𝐨𝐧 𝐏𝐚𝐩𝐞𝐫 𝐨𝐧 𝐀𝐈 𝐒𝐮𝐩𝐞𝐫𝐯𝐢𝐬𝐢𝐨𝐧 𝐟𝐨𝐫 𝐂𝐨𝐧𝐬𝐮𝐥𝐭𝐚𝐭𝐢𝐨𝐧 IAIS - International Association of Insurance Supervisors (IAIS) has released a draft Application Paper on the supervision of artificial intelligence (AI) for public consultation. This paper underscores the importance of the Insurance Core Principles (ICPs), highlighting how existing governance and conduct expectations remain crucial for supervisors and insurers utilizing AI. ⚠️ Recognizing that AI can amplify existing risks, the paper emphasizes the need for ongoing education for Boards and senior managers to establish robust risk and governance frameworks, ensuring positive consumer outcomes. It also notes that the increasing use of AI can elevate the role of third parties, such as AI model vendors. Consistent with existing ICPs, the paper reaffirms that insurers are responsible for understanding and managing these systems and their outcomes. 📄 The Application Paper addresses four key areas: 🏛️ Governance and accountability 🔒 Robustness, safety, and security 🔍 Transparency and explainability ⚖️ Fairness, ethics, and redress 📅 Comments are invited by  February 17, 2025. 📅 IAIS will be hosting an online background session on December 13, 2024 to present the consultation material and answer questions from stakeholders. #AI #Insurance #IAIS   Alana Scotchmer | Naim Antaki | Parna Sabet-Stephenson

🚨 𝗔𝘁𝘁𝗲𝗻𝘁𝗶𝗼𝗻 𝗮𝗹𝗹 𝗮𝗽𝗽𝗹𝗶𝗰𝗮𝗻𝘁𝘀 𝘂𝗻𝗱𝗲𝗿 𝘁𝗵𝗲 𝗥𝗣𝗔𝗔!🚨 ⌚📅 The deadline to register under the 𝘙𝘦𝘵𝘢𝘪𝘭 𝘗𝘢𝘺𝘮𝘦𝘯𝘵 𝘈𝘤𝘵𝘪𝘷𝘪𝘵𝘪𝘦𝘴 𝘈𝘤𝘵 (RPAA) with the Bank of Canada is fast approaching – only a few days left until November 15! ⏳ Our latest Gowling WLG article provides 𝙚𝙭𝙘𝙡𝙪𝙨𝙞𝙫𝙚 insights into what applicant information will become public under the RPAA and when. 📰 This can be incredibly helpful as you complete and submit your applications this week. Understanding what information becomes public will help you prepare for any potential inquiries or scrutiny from stakeholders. By staying informed, you can ensure a smoother registration process and avoid any last-minute surprises.💡 Don't miss out on this valuable information. Read the full article below⤵ Parna Sabet-Stephenson | Alana Scotchmer | Angelica Wilamowicz | #RPAA | #BankOfCanada | #PSP

🚀 Payment Service Provider (PSP) registration with the Bank of Canada (BoC) is now OPEN! 🚀   To help you prepare, the BoC’s recent webinar on registration under the Retail Payment Activities Act (RPAA), held on October 3, is now available for viewing! 🎥 Watch the recording now on the Bank of Canada’s YouTube channel: https://lnkd.in/dNZmmgnT This informative session covered crucial topics, including:   🌐 An overview of the RPAA ❓ Who needs to register? 📝Preparing for registration 📆 Key dates and what to expect 🔍 Demo: PSP Connect (the BoC’s online registration portal)   🙋♀️The webinar also featured a Q&A session with Bank of Canada officials, providing attendees the opportunity to get their pressing questions answered. For more details, visit BankofCanada.ca/RPS to access resources, sign up for the BoC’s newsletter, and stay updated on the latest engagement opportunities. We look forward to continuing these important discussions about PSP regulation in Canada.   Gowling WLG | Alana Scotchmer | Parna Sabet-Stephenson | Angelica Wilamowicz | Donya Ashnaei   #RPAA #RetailPayments #PaymentProviders

🎉 Happy ⓇⓅⒶⒶ Eve! 🎉 🛫⏰ We are T- 1️⃣ day away from the launch of Canada's 𝘙𝘦𝘵𝘢𝘪𝘭 𝘗𝘢𝘺𝘮𝘦𝘯𝘵 𝘈𝘤𝘵𝘪𝘷𝘪𝘵𝘪𝘦𝘴 𝘈𝘤𝘵 (RPAA) regime, regulated by the Bank of Canada. As a special treat (not a trick, we promise), we are thrilled to announce a comprehensive hub of information on the Gowling WLG FSxT website.📚 👩💻 Our RPAA hub offers exclusive insights that you won't find anywhere else, including detailed information on the registration process and the regulator's approach. Whether you're a payment service provider looking to navigate the new regulations or simply interested in staying informed, our resources are designed to help you every step of the way. Don't miss out on this valuable information. Visit our website now and be prepared for the RPAA launch! 💼🍁 Alana Scotchmer | Parna Sabet-Stephenson | Angelica Wilamowicz | #RPAA #PSP #PaymentServiceProviders

🚨We're just 2️⃣ days away from the 𝘙𝘦𝘵𝘢𝘪𝘭 𝘗𝘢𝘺𝘮𝘦𝘯𝘵 𝘈𝘤𝘵𝘪𝘷𝘪𝘵𝘪𝘦𝘴 𝘈𝘤𝘵 (RPAA) registration window opening! 🚀 As we approach November 1, 2024, we've been sharing a series of articles to help you understand the RPAA registration process and requirements, and why what's coming next is more important than ever. 🏦💡 ⚡📰 In today’s article, we highlight insights from Ron Morrow, Executive Director of Payments, Supervision and Oversight at the Bank of Canada (BoC) at our recent Gowling WLG FSxT event in Toronto, where he discussed the registration deadline, November 15, 2024, and what the BoC plans to do after that important date. 📅 Whether you’re a fintech enthusiast, a compliance professional, or just curious about the future of payments, this is a must read! 📖🔍 Stay tuned and get ready! 🚀✨ Parna Sabet-Stephenson | Alana Scotchmer | Angelica Wilamowicz

🎉 News from The Logic 𝐒𝐮𝐦𝐦𝐢𝐭! 🎉 Yesterday, Bank of Canada Governor Tiff Macklem had an insightful conversation with Kevin Carmichael in Toronto. For all our payments professionals, here’s the scoop you need to know! 🏦💡   𝐖𝐡𝐚𝐭 𝐰𝐢𝐥𝐥 𝐭𝐡𝐞 𝐑𝐏𝐀𝐀 𝐫𝐞𝐠𝐢𝐦𝐞 𝐥𝐨𝐨𝐤 𝐥𝐢𝐤𝐞? ➡️ It's not like a banking or prudential regulation but it aims to safeguard user funds (it will ensure that if I make a payment to you, you get the money, and vice versa) and it also oversees payment service providers to ensure operational resilience and prevent system failures. ➡️ It's not heavy-handed. The Bank of Canada wants innovation while ensuring the system is safe, secure, and reliable for Canadians. 🇨🇦✨ 𝐎𝐧𝐥𝐲 3️⃣ 𝐝𝐚𝐲𝐬 𝐥𝐞𝐟𝐭 𝐮𝐧𝐭𝐢𝐥 𝐫𝐞𝐠𝐢𝐬𝐭𝐫𝐚𝐭𝐢𝐨𝐧 𝐨𝐩𝐞𝐧𝐬 𝐨𝐧 𝐍𝐨𝐯𝐞𝐦𝐛𝐞𝐫 1𝐬𝐭!   Our FSxT team has got you covered with everything you need to know. Check it out: https://lnkd.in/dF2ddNr6 📚🔍   𝐀𝐬 𝐟𝐨𝐫 𝐭𝐡𝐞 𝐫𝐞𝐚𝐥 𝐭𝐢𝐦𝐞 𝐫𝐚𝐢𝐥 (𝐑𝐓𝐑)? ➡️ It should have been done by now, and we’re all disappointed including the Governor. It’s taken longer than it should have. 😔 ➡️ Canada has historically been a leader in payments but has fallen behind other jurisdictions. We need to catch up! 🏃♂️💨 ➡️ Payments Canada has provided a new timeline, indicating the system will be ready for testing in 2026. It’s crucial that we get there. 🔧 ➡️ Initially, we need to start domestically, but globally, discussions at the IMF and G7 are growing about interlinking cross borders. For us, the biggest market would of course be the US. 🌎🇺🇸 ➡️ Payments Canada has made changes in their technology provider and business requirements. They are confident to deliver RTR, and they have to get it done. 💪🔧 Stay tuned for more updates and get ready for November 1st! 🚀 #RPAA #Payments Alana Scotchmer | Angelica Wilamowicz | Parna Sabet-Stephenson

🚨 Developments in Cybersecurity! 🚨 We explore how Bill C-26 will shape the future of cybersecurity across 𝐜𝐫𝐢𝐭𝐢𝐜𝐚𝐥 𝐢𝐧𝐟𝐫𝐚𝐬𝐭𝐫𝐮𝐜𝐭𝐮𝐫𝐞 𝐬𝐞𝐜𝐭𝐨𝐫𝐬, including Canada’s financial sector, under the proposed 𝐂𝐫𝐢𝐭𝐢𝐜𝐚𝐥 𝐂𝐲𝐛𝐞𝐫 𝐒𝐲𝐬𝐭𝐞𝐦𝐬 𝐏𝐫𝐨𝐭𝐞𝐜𝐭𝐢𝐨𝐧 𝐀𝐜𝐭 (CCSPA). This proposed legislation introduces new obligations for operators of 𝐯𝐢𝐭𝐚𝐥 𝐬𝐞𝐫𝐯𝐢𝐜𝐞𝐬 like 𝐛𝐚𝐧𝐤𝐢𝐧𝐠, 𝐜𝐥𝐞𝐚𝐫𝐢𝐧𝐠 𝐚𝐧𝐝 𝐬𝐞𝐭𝐭𝐥𝐞𝐦𝐞𝐧𝐭 𝐬𝐲𝐬𝐭𝐞𝐦𝐬 to strengthen resilience against evolving cyber threats. Here’s how Bill C-26 will impact the financial industry: ➡️ 𝐂𝐲𝐛𝐞𝐫𝐬𝐞𝐜𝐮𝐫𝐢𝐭𝐲 𝐏𝐫𝐨𝐠𝐫𝐚𝐦𝐬: Operators must develop comprehensive cybersecurity programs to manage risks from third-party vendors and supply chains and submit these programs for regulatory review within 90 days of designation. 🛠️🔍 ➡️ 𝐈𝐧𝐜𝐢𝐝𝐞𝐧𝐭 𝐑𝐞𝐩𝐨𝐫𝐭𝐢𝐧𝐠 𝐰𝐢𝐭𝐡𝐢𝐧 72 𝐇𝐨𝐮𝐫𝐬: In addition to OSFI’s 24-hour incident reporting requirements and Canadian privacy laws, operators must report cyber incidents to the Communications Security Establishment (CSE) and notify their sector-specific regulators. 🕒📢 ➡️ 𝐂𝐲𝐛𝐞𝐫𝐬𝐞𝐜𝐮𝐫𝐢𝐭𝐲 𝐃𝐢𝐫𝐞𝐜𝐭𝐢𝐨𝐧𝐬: The CCSPA allows for the issuance of cybersecurity directions, which mandate operators to implement measures that protect critical cyber systems. 📜🛡️ ➡️ 𝐌𝐚𝐢𝐧𝐭𝐚𝐢𝐧𝐢𝐧𝐠 𝐑𝐞𝐜𝐨𝐫𝐝𝐬: Operators must maintain records of their cybersecurity programs, risk assessments, and incident reports, along with actions taken to comply with the CCSPA’s requirements. 📂✅ ➡️ 𝐑𝐞𝐠𝐮𝐥𝐚𝐭𝐨𝐫𝐲 𝐎𝐯𝐞𝐫𝐬𝐢𝐠𝐡𝐭 𝐚𝐧𝐝 𝐏𝐞𝐧𝐚𝐥𝐭𝐢𝐞𝐬: Non-compliance can result in fines of up to $15 million for operators and $1 million for directors, reflecting the heightened focus on accountability and preparedness. 💸⚖️ Recent amendments introduced through the 𝐂𝐨𝐮𝐧𝐭𝐞𝐫𝐢𝐧𝐠 𝐅𝐨𝐫𝐞𝐢𝐠𝐧 𝐈𝐧𝐭𝐞𝐫𝐟𝐞𝐫𝐞𝐧𝐜𝐞 𝐀𝐜𝐭 (Bill C-70) also establish the 𝐒𝐞𝐜𝐮𝐫𝐞 𝐀𝐝𝐦𝐢𝐧𝐢𝐬𝐭𝐫𝐚𝐭𝐢𝐯𝐞 𝐑𝐞𝐯𝐢𝐞𝐰 𝐏𝐫𝐨𝐜𝐞𝐞𝐝𝐢𝐧𝐠𝐬 (𝐒𝐀𝐑𝐏) framework, ensuring data privacy protections during judicial reviews while balancing national security concerns. 🛡️🔒 Dive deeper into the implications of Bill C-26 here ⬇️ #Cybersecurity #FinancialServices #BillC26 #CCSPA Jasmine Samra | Brent Arnold

📢 Office of the Superintendent of Financial Institutions Canada and Financial Consumer Agency of Canada | Agence de la consommation en matière financière du Canada have released the "Risk Report - AI Uses and Risks at Federally Regulated Financial Institutions" which outlines key risks ⚠️that arise for financial institutions from AI ✨. In a nutshell, these risks fall in two buckets: 👆 risks arising from internal AI adoption, comprised of:              ➡️Data governance risks              ➡️Model risks and explainability              ➡️Legal, ethical and reputational risks              ➡️Third party risks              ➡️Operational and cybersecurity risks ✌️ risks arising from the use of AI by external actors, comprised of:              ➡️Reports on rates of technological progress in AI              ➡️Reports on increasing cyber and fraud threats              ➡️Business and financial risks              ➡️Emerging credit, market, and liquidity risks While use of AI ✨ is becoming more widespread among financial institutions, regulators are also keeping pace! OSFI and FCAC are working together 🔗 to actively monitor the evolving risk environment and support best practices at financial institutions. However, they both already have technology-neutral guidance covering many areas of concern about AI relating to consumer protection laws and regulations, guidance on model risk management, third-party risk management, cybersecurity, and operational resilience. Time to examine those again. 📌 Alana Scotchmer | Naim Antaki | Parna Sabet-Stephenson https://lnkd.in/egcXDiyX