Eleven crypto shops on Yonge Street had their registrations revoked as Canada’s anti-money laundering watchdog continues its crackdown on a sector facing mounting concerns that it is vulnerable to illicit activity.
The businesses were identified in January by the Star, in collaboration with the International Consortium of Investigative Journalists (ICIJ), as part of an investigation that revealed a proliferation of scores of shops advertising crypto services on the thoroughfare, the majority of which were not authorized to do so.
Of these 11 Fintrac has just unauthorized, six were not registered to provide virtual currency services in Canada. The regulator did not provide reasons for the enforcement actions, including why it revoked registrations for the five other Yonge St. crypto shops that did have permission to deal in crypto.
Virtual currency firms can be used to move illicit funds while bypassing law enforcement and regulators, critics have warned. The Star and ICIJ had also revealed that GTA crypto shops used wallets allegedly linked to Iran-backed terror groups.
The new batch of registration revocations has brought Fintrac’s total to 320 over the past five years, an enforcement effort previously criticized for not going far enough. More than a quarter of the revocations have happened in just the last three weeks.
Fintrac’s announcement also included the revocations of 40 other businesses’ registrations, mostly in Ontario and British Columbia, that also provided crypto services. Fintrac put out the list of its newest revocations on Wednesday.
Ottawa keeps the pedal down
Finance Minister François-Philippe Champagne has recently underscored a “significantly increased pace of action,” vowing to maintain the momentum and pursue new measures to address risks posed by virtual currency businesses, “which can be used to facilitate money laundering and fraud.”
Denis Meunier, a former deputy director at Fintrac said Wednesday’s announcement was a “positive step.”
“Now there is momentum,” he said. “I am encouraged to see that Fintrac is focusing on those that are involved in virtual currency, because they are high risk.”
Publicity can create pressure, and that appeared to be a factor, cryptocurrency investigator Richard Sanders said.
He noted that the regulator’s revocations of the 11 shops came two months after the media asked about them, which suggests Fintrac has the ability to act quickly.
Concern over Fintrac’s methods
Not on the revoked list are the two Yonge St. shops that the Star had found used wallets allegedly linked to Iran-backed terror groups. Fintrac has not answered questions about these or any individual shops.
“FINTRAC is committed to ensuring that businesses fulfil their legal obligations,” said agency spokesperson Darren Gibb. “When it is warranted, the centre will take action to prevent businesses and their services from being used to harm Canada and Canadians.”
Fintrac can also issue administrative monetary penalties and generate non-compliance disclosures for police in support of criminal investigations, he said.
With the velocity of the enforcement, however, comes concerns about whether some revocations are warranted.
The agency said it can revoke registrations if an owner or operator is convicted of certain crimes such as money laundering or terrorist financing, doesn’t answer the agency’s requests for information or fails to update Fintrac on changes to its name or address.
Once a company’s registration with Fintrac is revoked, it can no longer legally operate.
A missed email, followed by a revocation
The Star has learned some businesses were revoked allegedly after they did not respond to, or simply missed emails from, Fintrac.
“I am aware of multiple recent cases where an MSB’s (Money Services Business’) registration was revoked, without warning, for failure to respond to an information request,” said Gabriel Latner, a lawyer in Toronto representing clients in disputes with Fintrac.
He said unlike in earlier cases where Fintrac has taken months and allowed allegedly non-compliant parties to make submissions in their defence before taking action, Fintrac acted summarily this time.
In some cases, he said, Fintrac only sent these information demands by email, to generic corporate inboxes, and didn’t take appropriate steps to ensure they were received before taking disciplinary action.
Mohammad Danesh, owner of Danesh Exchange in Richmond Hill, told the Star that he learned about the revocation from a customer while he was stuck in Iran. He did not know why his registration was taken away. Fintrac revoked Danesh’s registration on March 6.
“We have not done anything wrong. So I don’t know what’s going on,” he said, noting he did not receive any warning.
A compliance officer at Ava Exchange, a Richmond Hill business that was stripped of its registration this week, told the Star that they missed an email from Fintrac requesting crypto wallet addresses two weeks ago, but the firm hasn’t offered crypto virtual currency services since the end of 2025. The company is communicating with Fintrac to reinstate the registration, she said.
Fintrac said businesses may request a review of a decision to deny or revoke a registration. The Director and Chief Executive Officer may decide to confirm the decision or substitute her own decision.
