Canada is moving to ban cryptocurrency ATMs as it creates a new Financial Crimes Agency to investigate and prosecute financial crimes, a shift officials say is meant to hit scammers and money launderers where they operate. The bill to establish the agency cleared its first reading in parliament this week.
The timing matters because Canada has nearly 4,000 cryptocurrency ATMs, the most per capita in the world, and authorities say those machines have become a tool for both fraud and laundering the proceeds of crime. The new agency would take on investigative and prosecutorial powers that Fintrac, Canada’s financial intelligence unit, has never had.
Jessica Davis, a financial crime expert, said the creation of a new enforcement body is a meaningful step if Ottawa is serious about the problem. “The fact we’re actually seeing the creation [of a] new enforcement agency is a meaningful investment and hopefully signals the understanding of the seriousness of the challenge,” she said. Davis also said the scale of the problem is still not fully known, calling it “a figure that could be too high or far too low – we just don’t fully know the scope of financial crime in this country.”
Fintrac has served as Canada’s financial intelligence unit for more than a quarter of a century, but it does not track down criminals or make arrests. Last year it uncovered $45bn in transactions tied to money laundering, counterterrorist financing, sanctions and evasion disclosures, a sign of how much illicit activity passes through the system even before investigators get involved. Under the new legislation, the Financial Crimes Agency would take over the work of investigating and prosecuting those cases, while the bill also narrows the scope and mandate of Fintrac and the Royal Canadian Mounted Police.
The move comes after a public inquiry found Canada lacked a cohesive strategy against money laundering, and it lands against a broader global backdrop that has alarmed governments for years. A 2024 report on the scale of financial crimes estimated that more than US$3tn in illicit funds moved through the global financial system in the previous year, while a 2024 U.S. Treasury Department report said those efforts had devastating economic and social effects on citizens.
Davis said the RCMP has long fallen short on financial crime cases. “The challenge for the RCMP is that it has been unable and unwilling to actually investigate and sustain investigations related to financial crimes,” she said. She added that the bottlenecks are familiar: “There is a lack of funding, a lack of skills, lack of resources and a lack of political will.”
Canada’s decision also comes as the current U.S. administration has taken a different tone on financial crime, including a high-profile pardon of Changpeng Zhao after he pleaded guilty to money laundering charges, while Binance had previously been ordered to pay a record $4.3bn penalty for its role in facilitating terrorist financing. For Canada, the question now is whether a new agency and a bitcoin atm ban can close a gap that has been open for years. Davis said the work ahead will be slow and demanding, but worth doing: “But financial crimes investigations are long, complex and require sustained resources, which I’m hopeful we’re now going to see put in place.”
