Final answer:
Brokerages must evaluate their FINTRAC compliance program annually, ensuring they effectively mitigate the risks of money laundering and terrorist financing. These evaluations include a review of training, reporting, record-keeping, and client identification processes.
Step-by-step explanation:
A brokerage is required to evaluate the effectiveness of its FINTRAC compliance program annually. This means that once every year, a brokerage must go through its procedures and policies to ensure that they are adequately detecting and preventing money laundering and terrorist financing activities as mandated by the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC). In these evaluations, brokerages should assess all aspects of their compliance program including training programs for employees, reporting practices, record-keeping, and client identification processes. If deficiencies are found, the brokerage is expected to take corrective action promptly to ensure that it meets all regulatory requirements set forth by FINTRAC.