Recommendations

• 1. Civil Society Inclusion

• Establish a dedicated working group on nonprofit de‑risking and financial access within the Advisory Committee on Money Laundering and Terrorist Financing (ACMLTF), expanding its membership to include nonprofit and civil society representatives.

  Applies to:

  Department of Finance Canada

  ACMLTF

  Recommendation 1

• Make financial inclusion and transparency explicit priorities in all AML/CTF policy discussions, ensuring anti‑terrorism financing measures do not unnecessarily restrict banking access for nonprofits.

  Applies to:

  Department of Finance Canada

  ACMLTF

  Recommendation 2

• Collaborate with civil society to establish risk mitigation protocols for humanitarian and Muslim‑led charities.

  Applies to:

  Canadian Bankers Association

  Recommendation 3

• 2. Institutional Practices

• Develop and enforce internal policies requiring individualized, evidence‑based risk assessments of nonprofit clients. Blanket exclusions based on sector, faith, or indirect associations must be prohibited.

  Applies to:

  Banks

  Recommendation 4

• Audit algorithmic risk tools regularly to eliminate bias, including hidden patterns in AI‑based decisions. Training data must reflect current realities and be free from historical prejudice.

  Applies to:

  Banks

  Recommendation 5

• Train compliance officers on equity, human rights, and the systemic impact of de‑risking.

  Applies to:

  Banks

  Recommendation 6

• Develop transparent protocols allowing nonprofit clients to identify and address risk concerns before service restrictions or account termination.

  Applies to:

  Banks

  Recommendation 7

• 3. International Coordination

• Represent Canadian nonprofit concerns in international forums like the Financial Action Task Force (FATF) and advocate for proportionate, inclusive standards.

  Applies to:

  Department of Finance Canada

  Recommendation 8

• Champion clear humanitarian carve‑outs under sanctions frameworks and coordinate international safe financial corridors.

  Applies to:

  Global Affairs Canada

  Recommendation 9

• 4. Legislative & Regulatory Reform

• Amend Canada’s AML regulations and National Inherent Risk Assessment to embed proportionality and financial inclusion as core principles.

  Applies to:

  Department of Finance Canada

  Recommendation 10

• Conduct a Charter compliance review of AML/CTF laws and publish legal guidance to safeguard equality rights.

  Applies to:

  Department of Justice

  Recommendation 11

• Hold parliamentary hearings on de‑risking’s impact on nonprofits, with a focus on Muslim charities.

  Topics:

  • Evaluating discriminatory data‑sharing and surveillance loops
  • Investigating algorithmic bias in compliance tools
  • Amending the Bank Act to require closure explanations, extended notice, and appeals
  • Publishing anonymized closure data and sector impact
  • Strengthening consumer protections for de‑banked entities

  Applies to:

  House of Commons Finance Committee

  Recommendation 12

• Hold hearings to evaluate how innovation and corporate governance policies can support nonprofit financial access.

  Topics:

  • Interoperability of nonprofit registries and AML systems
  • Innovation in digital ID and KYC
  • Fintech solutions for humanitarian finance
  • Expansion of the federal beneficial ownership registry

  Applies to:

  ISED Committee

  Recommendation 13

• 5. Oversight & Accountability

• Require banks to offer internal appeal mechanisms for account closures or service denials.

  Applies to:

  Banks

  Recommendation 14

• Create a public clearance mechanism for charities that pass CRA audits and reform the release of Administrative Fairness Letters.

  Applies to:

  CRA

  Recommendation 15

• Mandate anonymized, sectoral data collection and publication on account closures and complaints.

  Applies to:

  Department of Finance Canada

  FINTRAC

  FCAC

  OBSI

  Recommendation 16

• Legislate clear written explanations for account closures (except during active investigations), longer notice periods, and an appeals process. Expand FCAC’s mandate to review discriminatory closure patterns.

  Applies to:

  FCAC

  OBSI

  Recommendation 17

• Require periodic audits to assess how banks implement the risk‑based approach, ensuring alignment with FINTRAC’s guidance discouraging indiscriminate closures.

  Applies to:

  FINTRAC

  Recommendation 18

• Expand OSFI’s oversight role to include equity and fairness in risk modeling, and assess sector‑level disparities.

  Applies to:

  OSFI

  Recommendation 19

• Create formal policies guiding law enforcement interactions with financial institutions to prevent account closures based on informal or leaked information.

  Applies to:

  RCMP

  CSIS

  Recommendation 20