🛡️ Detecting and Preventing Mortgage Fraud; FINTRAC Obligations

1. RECA's Guidelines for Mortgage Broker Originated Applications define mortgage fraud. Which definition do they use?

1. Any loan approved above appraised value, whether or not anyone made a misstatement
2. A misrepresentation that causes a lender a loss once the loan has gone into default
3. Any false statement the borrower knowingly signs in an application, material or not
4. A material misstatement, misrepresentation or omission relied on by a lender or insurer

The Guidelines (Definitions, p. 3 of 12) define mortgage fraud as any material misstatement, misrepresentation or omission relied upon by a lender or insurer to underwrite, approve, fund or insure a mortgage loan. The test is materiality and reliance, not loss: the fraud exists once the lender or insurer relies on the false or missing information, even if the loan never defaults.

2. A couple tell their mortgage associate they will live in the condo they are buying, which lets them qualify for a high-ratio insured loan. In fact they plan to rent it out from day one. How does RECA classify this?

1. Fraud for housing: lying to qualify for a mortgage they would not otherwise get
2. Fraud for title: their false statement changes the registered title on the condo unit
3. Not fraud: occupancy plans are personal and are not material to the lender's decision
4. Fraud for profit: a group of insiders inflates the price of a home to extract loan funds

RECA's Types of Mortgage Fraud sheet says it is fraud for housing to give false or misleading information on an application to qualify for a mortgage you would not otherwise get, and that it is also fraudulent to say you will live in the property when you have no intention of doing so. Occupancy is material: it drives the product, the insurance and the pricing the lender offers.

3. A Lethbridge homeowner who owns her house free and clear discovers that a mortgage has been registered against it. Someone used forged identification in her name to borrow the money. Which scheme does this describe?

1. Foreclosure fraud, where a distressed owner is persuaded to transfer title to a rescuer
2. A straw buyer scheme, where a person lends their name and credit for a cash payment
3. Fraud for title, where a stolen identity is used to borrow against the owner's home
4. Fraud for housing, where a buyer overstates income to qualify for a larger mortgage

Under RECA's Types of Mortgage Fraud sheet, fraud for title happens when someone steals your identity and uses fake documents and identification to 'steal' or change the title on a home you own, then takes out a mortgage on it; the lender advances funds on the stolen or fake documents and the owner is left with a debt in her name. Foreclosure fraud differs because the distressed owner signs the title over herself.

4. A homeowner facing foreclosure is offered a deal: transfer title to the promoter, pay him 'rent', and he will take over the mortgage and return the title once the foreclosure ends. According to RECA, how does this scheme typically end?

1. The lender stays the foreclosure because a new owner has assumed the existing mortgage
2. The owner regains title once the rent paid equals the arrears that began the foreclosure
3. The promoter pays the arrears, then charges the owner a high rate of interest on them
4. The promoter keeps the rent, pays nothing on the mortgage and may resell or remortgage

RECA's Debt Rescue Fraud sheet (steps 3-4) describes the owner signing the title over, then the fraudster pocketing the 'rent' money, paying nothing towards the mortgage and possibly remortgaging or selling the property to a new buyer, leaving the owner homeless and in debt. The Types of Mortgage Fraud sheet calls this foreclosure fraud. RECA's advice is never to sign over your title and to have a lawyer review all documents.

5. In RECA's consumer material on mortgage fraud, what is a straw buyer?

1. A buyer who signs under a power of attorney for a seller who lives outside the province
2. A buyer whose down payment is a gift from a relative who will not appear on the title
3. A person who puts their name and credit on a mortgage application for another person
4. A buyer who makes an offer only to tie up a property, then assigns the contract for a fee

RECA's Straw Buyer Mortgage Fraud sheet defines a straw buyer as someone who agrees to put their name on a mortgage application on behalf of another person, typically for a cash payment; the Types of Mortgage Fraud sheet adds that the straw buyer lends his or her identity and good credit to the fraud. A documented gift from an immediate relative is a legitimate down payment source under the Guidelines.

6. Two straw buyers sign the title of a house they bought over to the organizer of the scheme, who then stops paying the mortgage. According to RECA, what is the straw buyers' position?

1. They are treated as victims, so the lender must first sue the organizer and the lawyer
2. They are released once title is transferred, as the new owner takes over the mortgage
3. They remain responsible for the mortgage, and the lender can pursue them for payments
4. They are liable only for the cash they were paid, which the lender may claim as damages

RECA's Straw Buyer sheet (step 9) states that after signing the title over to the mastermind, the straw buyers are still responsible for the mortgage and the lender will pursue them for ongoing payments; the Types of Mortgage Fraud sheet confirms straw buyers can be held legally responsible for the mortgage debt. Transferring title does not transfer the borrowers' personal covenant to pay.

7. A Calgary house is listed at $520,000 and an organizer's offer of $495,000 is accepted. He then has straw buyers sign a second contract at $550,000. A lender funds 95% of that price through a complicit lawyer, who pays the seller $495,000. How much of the loan is left over for the organizer's group?

1. $30,000 left over once the seller is paid
2. $55,000 left over once the seller is paid
3. $27,500 left over once the seller is paid
4. $25,000 left over once the seller is paid

The mechanics follow RECA's Straw Buyer sheet (steps 1-8); the figures here are illustrative. The loan is 95% x $550,000 = $522,500, and the lawyer pays the seller the real price of $495,000, so $522,500 - $495,000 = $27,500 is left for the group, out of which the straw buyers and the lawyer are paid. $55,000 is the gap between the two contract prices, which ignores that the lender funded only 95%.

8. An Edmonton house listed at $610,000 really sells for $580,000, but the lender receives a contract showing $640,000 and approves a loan of 90% of that price. Measured against the real sale price, what is the true loan-to-value ratio, rounded to two decimals?

1. 99.31% of the real sale price
2. 110.34% of the real sale price
3. 94.43% of the real sale price
4. 90.00% of the real sale price

RECA's poster lists a mortgage amount significantly higher than the property's value as a red flag, and inflated contracts are how it happens. The loan is 90% x $640,000 = $576,000, and $576,000 / $580,000 = 99.31%. The lender believes it is at 90.00%; $576,000 / $610,000 = 94.43% uses the list price; 110.34% is the fake price divided by the real price, not the loan.

9. A buyer funds a large down payment he cannot document, then pays the mortgage down within months through lump sums sent by several unrelated people. Which scheme named in the PMB blueprint does this pattern most suggest?

1. Fraud for housing, which misstates facts to qualify for a home the buyer will live in
2. Fraud for profit, which inflates a price to extract extra loan funds from the lender
3. Money laundering, which disguises the source of money obtained through crime
4. Fraud for title, which borrows against another owner's home using a stolen identity

The PMB blueprint (LO 4.1.4) contrasts fraud for housing, fraud for profit and money laundering. FINTRAC's glossary, quoting the United Nations, describes money laundering as any act or attempted act to disguise the source of money or assets derived from criminal activity. Unexplained funds run through a property and paid down by unrelated payers fit that aim: the goal is to make money look clean, not to get a loan the buyer could not otherwise obtain. The pattern calls for an STR assessment under s. 7 of the PCMLTFA.

10. A mortgage associate knowingly forwards a fabricated employment letter with a client's application. The lender declines the loan. Under the Real Estate Act Rules, what is the associate's position?

1. No breach occurred, because the lender declined the loan and suffered no loss
2. The associate breached s. 42(b) by taking part in fraudulent activity in a dealing
3. It is a contract issue between the lender and the associate, not a Rules breach
4. Only the client is liable, since the associate simply forwarded a client document

Real Estate Act Rules s. 42(b) provides that licensees must not participate in fraudulent or unlawful activities in connection with the provision of services or in any dealings. Knowingly submitting a fake document is participation, whatever the lender decides; the Guidelines' definition of fraud turns on a material misstatement, not on a loss. Such conduct can lead to discipline under Part 3 of the Real Estate Act.

11. Which feature of a buyer's deposit is listed as a red flag on RECA's tip sheet about the borrower/buyer?

1. The deposit is held in trust by the listing brokerage until the transaction closes
2. The deposit is increased after the buyer removes the financing condition as agreed
3. The deposit is paid by bank draft drawn on the buyer's own account at a chartered bank
4. The deposit comes from someone other than the buyer, or is paid in cash or money order

RECA's tip sheet on borrower/buyer red flags lists 'Deposit is from someone other than the buyer' and 'Deposit is provided in cash or by money order'. By contrast, the Guidelines expect that on MLS or exclusive purchases the purchase agreement shows the deposit held by the listing real estate office, which is ordinary practice.

12. An individual applies for a high-ratio insured mortgage to buy a townhouse, but the purchase contract the associate receives names '1234567 Alberta Ltd.' as the buyer. Why should this concern the associate?

1. Corporations cannot hold land in Alberta, so the contract is void and must be redrafted
2. An individual seeking high-ratio financing while a company is the buyer is a red flag
3. Numbered companies must file a caveat before closing, which delays the commitment
4. It has no relevance, since the lender assesses the individual's income and credit

RECA's borrower/buyer tip sheet lists 'Borrower is an individual seeking a high-ratio mortgage, but the purchase contract indicates the buyer is a corporate entity', and the property-value sheet flags corporate-owned property with a high-ratio mortgage. The Guidelines also require confirming that the borrowers are the same in number as those on the application and that names are spelled correctly.

13. Which feature of a purchase file appears on RECA's tip sheet of red flags indicating unusual transactions?

1. Buyer and seller are represented by the same lawyer in the same transaction
2. The seller accepted the buyer's offer after two rounds of counter-offers on price
3. The purchase contract has a financing condition and a home inspection condition
4. The buyer's lawyer asks for a Real Property Report before the closing date is set

RECA's tip sheet on unusual transactions lists 'Both the buyer and seller are represented by the same lawyer in the same transaction'. Conditions, real negotiation and a request for a Real Property Report are ordinary practice; the sheet flags the opposite of the first two, a contract with no conditions on a high-ratio deal and an offer accepted as written without any counter-offer.

14. A borrower says she will occupy a house and qualifies for a high-ratio insured loan. The purchase contract lets the buyer show the property to prospective tenants before possession. What should the associate conclude?

1. The clause is standard in Alberta contracts and needs no comment in the lender file
2. The clause concerns only the seller, so it should be referred to the listing brokerage
3. The clause conflicts with stated owner-occupancy and is a red flag to be explained
4. The clause turns the loan into a rental product, so the lender's rate will change

RECA's unusual-transactions tip sheet lists a contract condition allowing the buyer to show the property to prospective tenants, and the property-value sheet flags contracts referring to tenants when the borrower applies for a high-ratio mortgage. Under the Guidelines (Inconsistencies, p. 5) the associate must note the inconsistency and obtain an explanation; if none is reasonable, the lender must be told before submission.

15. Which pattern does RECA list as a red flag regarding property value?

1. The list price is in line with recent sales of similar homes in the neighbourhood
2. The property sold once in the past ten years, at a price close to today's list price
3. Ownership changed several times in a short period, with a price increase each time
4. The appraisal was ordered from the lender's own list of authorized appraisers

RECA's property-value tip sheet lists 'Property ownership has changed several times in a short period with price increases on each change' and 'Property is listed after recently selling for a much lower price'. Its poster adds a property refinanced several times with a larger mortgage each time. A price in line with comparable sales is the opposite of the flag for an unusually high price.

16. A purchase contract shows $640,000 with a normal down payment. You later learn the seller is also taking back a second mortgage that is not mentioned anywhere in the contract. What is the main concern?

1. A vendor take-back matters only when the seller is a corporation or numbered company
2. A vendor take-back is prohibited on residential property bought by an individual
3. An undisclosed vendor take-back can hide the buyer's real equity and the real price
4. A vendor take-back must rank first, ahead of the new lender's first mortgage

RECA's property-value tip sheet lists vendor take-back mortgages or other equity arrangements, and specifically a vendor take-back that is not referenced in the purchase contract. The Guidelines require confirming that no other contracts or obligations were left undisclosed and that the down payment comes from the applicant's own resources; a hidden VTB means the lender is misled about both.

17. A broker reviews her brokerage against RECA's tip sheet on brokerage operations. Which finding is listed there as a red flag?

1. Licensees must send original transaction documents to the brokerage for its files
2. No policy or oversight exists for licensees' personal mortgage deals
3. Administrative staff are trained to recognize suspicious mortgage transactions
4. The broker reviews the brokerage's mortgage transactions on a regular schedule

RECA's brokerage-operations tip sheet lists: no fraud prevention policies, no policies or oversight for personal deals, untrained administrative staff, no requirement for original documents, no check that documents are filed, a broker who does not review transactions regularly, and no title search. Rules s. 67(1)(d) also requires written policies and procedures for personal deals.

18. All of the following appear on RECA's 2015 mortgage fraud tip sheets EXCEPT one. Which is NOT listed as a red flag?

1. The credit history is long and consistent with the borrower's age and income
2. The purchase price is the same as or higher than the list or asking price
3. The parties have no physical office and hold their meetings at restaurants
4. The buyer or seller uses a partial name, such as no first name or only an initial

RECA's tip sheets list partial names and parties with no formal or physical office (borrower/buyer sheet) and a purchase price equal to or above the list price (property-value sheet). A credit history consistent with age and income is what the Guidelines ask the broker to confirm; the red flag is the opposite, a credit history that is unusually short.

19. A credit report shows the applicant opened several new accounts and had many credit inquiries in the last two months. What do RECA's Guidelines say about this?

1. It may signal a straw buyer: record an explanation and refer to the broker
2. The associate should ask the lender to pull a second report and set the first aside
3. It is normal rate shopping, so it needs no explanation in the mortgage loan file
4. The associate must decline the client and report the inquiries to the credit bureau

The Guidelines (Credit Report, p. 8) say to be wary of recent credit seeking such as many new trades or current inquiries: recent multiple inquiries could indicate activity of a straw buyer. The associate should approach with caution, request an explanation, record it in the loan file and refer to the broker before proceeding.

20. When an applicant meets a mortgage associate in person, what identification do RECA's Guidelines require the associate to examine?

1. Three pieces of ID, including a SIN card and a recent utility bill in their name
2. Two original IDs, one of them government-issued in Canada with a photo
3. One piece of photo ID issued by any government, which may be a clear photocopy
4. Two pieces of ID of any kind, as long as both show the same name and address

Under the Guidelines, Verification of Identity (a), the broker must examine two pieces of identification for each applicant, one issued by the Government of Canada or a province and containing a photograph, and these should be originals, not copies. The ID is examined when the application is signed, its number and expiry date are recorded, and an Identification Attestation is completed.

21. An applicant in Grande Prairie cannot meet the associate in Calgary, and the lender requires the brokerage to verify identity. Under RECA's Guidelines, what is required at a minimum?

1. A phone interview, details of two IDs, and two of the listed additional checks
2. An email exchange plus a scanned copy of the front of the applicant's driver's licence
3. A video call only, since a remote file needs no further identity checks at all
4. A face-to-face meeting with a lawyer, after which the broker makes no checks

The Guidelines make a telephone interview the minimum where the application is not completed in the applicant's presence, and where the lender requires identity verification, section (b) requires recording the name, type, number and expiry date of two pieces of ID and performing two of the listed checks (directory listing, cleared personalized cheque, utility bill, SIN match, credit card list, or interview questions). The file must note that the interview was not held in person.

22. During a non-face-to-face identity check, which question do RECA's Guidelines suggest because someone holding a victim's stolen wallet usually cannot answer it?

1. What is your full date of birth, as shown on your provincial driver's licence?
2. What is the credit limit on a specific credit card shown in your credit file?
3. What is the number printed on the front of the credit card you carry today?
4. What is your current home address, including the unit and the postal code?

The Guidelines (p. 7) say to ask questions that cannot be answered from information typically found in someone's wallet or online, such as the credit limit of a specific card, because fraudsters typically don't know the credit limits attached to the cards; the answer is cross-checked with the credit file. Date of birth, address and card numbers are exactly what a stolen wallet reveals.

23. When should the associate obtain the applicant's signature on a mortgage loan application, according to RECA's Guidelines?

1. Only once the application is fully completed, never on a partly blank form
2. After the lender issues its commitment, so the amounts match the approval
3. Before the income section is filled in, so the client can confirm it later
4. At the first meeting, so that the credit report can be pulled the same day

The Guidelines (Application Information, p. 3) state: do not obtain the signature of the applicant until the mortgage loan application is fully completed. RECA's consumer poster lists being asked to leave signature lines or other important areas blank as a fraud red flag, because blank fields can be filled in later with false information.

24. An applicant's credit report lists an employer and two addresses she says she has never had, and she cannot explain the differences. What do RECA's Guidelines direct the associate to do?

1. Submit the application and let the lender's underwriter decide what the differences mean
2. Do not submit the application; she may want to ask the credit bureau about identity theft
3. Correct the credit report entries to match the application before sending it to the lender
4. Submit it with a note that the client disputes the report, since such disputes are common

The Guidelines (Inconsistencies, p. 5) state that if an applicant, when questioned, cannot give a satisfactory explanation for inconsistencies between the mortgage loan application and the credit report, the application should not be submitted to the lender, and the applicant may wish to contact the credit reporting agency about possible identity theft. A broker never alters a credit report.

25. A buyer's down payment includes a $30,000 gift. Under RECA's Guidelines, who may give it, and what must the gift letter show?

1. A relative, but with the letter signed by the buyer's lawyer rather than the giftor
2. Any friend or relative, confirmed by the buyer's own signed statutory declaration
3. Anyone at all, provided the funds stay in the buyer's account for at least 90 days
4. An immediate relative only, with the giftor's name, address, phone and relationship

Under the Guidelines (Down Payment, p. 9), a gift letter is obtained where the down payment is to be provided by an immediate relative only, and it must contain the name, address, phone number and relationship of the giftor(s). Evidence of the validity of the down payment goes to the lender before closing, and increased due diligence applies whenever the down payment is a gift or is borrowed.

26. A down payment comes from three bank accounts, and the statements provided are dated March 31, April 30 and May 31. Why is this a problem under RECA's Guidelines?

1. Statements must be dated within 30 days of the application, so the March one is too old
2. Statements should cover the same period, so money moved between accounts isn't counted twice
3. Statements must be originals from the bank, so printed online copies are not accepted
4. A down payment must come from a single account, so the other two must first be closed

The Guidelines (Down Payment, p. 9) require care, where the down payment comes from multiple sources, that account statement dates reflect the same time frame, to ensure funds have not been transferred between accounts; the evidence of the total down payment must not be falsified by moving funds between accounts. A summary of all sources, equal to the down payment plus closing costs, goes to the lender.

27. A father is selling a house to his son privately, with no listing and no real estate brokerage involved. What do RECA's Guidelines call for?

1. A copy of the MLS listing, which the son must get from the father's former agent
2. A signed Offer to Purchase, plus a Land Titles search sent to the lender for review
3. Nothing extra, since family sales are exempt from the Offer to Purchase requirement
4. A statutory declaration from the father that the price is fair, in place of an appraisal

The Guidelines (Offer to Purchase/Property Verification, p. 11-12) require an Offer to Purchase for all sale transactions, whether MLS, exclusive, private or non-arm's length (i.e. family), and on all private or non-arm's length sales a title search with the Land Titles Office forwarded to the lender; if discrepancies appear, an historical title search may be needed.

28. Under RECA's Guidelines for broker-originated applications, how long must a mortgage loan file be kept?

1. At least seven years, counted from the date of the commitment letter
2. At least three years for funded loans, and none for unfunded ones
3. At least one year after the mortgage term ends or is renewed
4. At least three years, for funded and for non-funded loans alike

The Guidelines (Definitions, 'Loan file', p. 2; Mortgage Loan File, p. 4) require loan files to be retained for no less than three years for both funded and non-funded loans, and to be immediately accessible to RECA on request. This matches Real Estate Act s. 25(9), which requires a licensee's records to be kept for 3 years after they came into existence, or longer if the executive director directs. Brokers must also meet the storage rules of other agencies that govern their activities.

29. A brokerage has arranged several private mortgages for the same real estate investor over two years, so it is in a business relationship with him. Under Regs s. 123.1, what must its periodic ongoing monitoring include?

1. Re-verifying his photo ID at each new mortgage, whatever risk level he has been given
2. Reassessing the client's risk and checking that his activity fits what it knows of him
3. Pulling a new credit report on him every year and adding it to the brokerage loan file
4. Sending FINTRAC a yearly summary of his mortgages, whether or not anything is unusual

Regs s. 123.1 requires an entity in a business relationship to conduct ongoing monitoring periodically, based on its risk assessment, to detect transactions reportable under s. 7 of the Act, keep client identification and the s. 138 and s. 145 information up to date, reassess the risk of the client's transactions and activities, and determine whether they are consistent with what it knows about the client; s. 146(1) requires a record of it. Identity already verified need not be verified again unless there are doubts (s. 155(1)), and no yearly credit report or summary to FINTRAC is required.

30. According to RECA's Guidelines, who is ultimately responsible for establishing the identity of all mortgage applicants?

1. The mortgage broker alone, who must meet every applicant face to face in all cases
2. The credit bureau, whose report confirms identity once the date of birth matches
3. The lender, which may contractually require a broker or lawyer to meet the applicants
4. The mortgage default insurer, which checks identity before approving insurance

The Guidelines (Verification of Identity, p. 5) state the lender is ultimately responsible for establishing the identity of all applicants; where it does not meet them, it must contractually obligate a mortgage broker or other designated third party, such as a lawyer, to verify ID face to face. Broker verification is still a best practice, and since October 11, 2024, Regs s. 102.1 separately requires mortgage brokers to verify identity for FINTRAC purposes.

31. A mortgage broker learns that an associate altered a client's pay stubs. Under Rules s. 67(3), which failure would make the broker accountable for the associate's conduct?

1. Failing to dismiss the associate that day, even if the registrar is notified
2. Failing to report it to the lender within 24 hours, whatever else is done
3. Failing to notify the registrar after learning of the associate's fraud
4. None, since a broker is never accountable for an associate's deliberate acts

Rules s. 67(3) makes a mortgage broker accountable for an associate's or employee's conduct if, among other things, the broker had knowledge and failed to take reasonable steps to stop it (e), failed to correct it or reduce the harm (f), or failed to notify the registrar upon becoming aware of misconduct relating to fraud, deception, theft or unlawful activities (g). Section 67 sets no 24-hour lender deadline and no automatic dismissal.

32. A mortgage associate discovers that another associate at her brokerage submits applications with inflated incomes. What does Rules s. 69 require her to do?

1. Do nothing unless she took part, as supervising associates is the broker's job
2. Tell the affected borrowers, so that they can withdraw their applications
3. Notify her broker on learning of the violation of the Act, Rules or Bylaws
4. Confront the other associate privately, and report only if it continues

Rules s. 69(g) requires a mortgage associate to notify the broker upon learning of a violation of the Act, Regulations, Rules or Bylaws by any broker, associate or employee associated with a brokerage. The broker must then act under s. 67(3), which includes notifying the registrar of misconduct relating to fraud.

33. A borrower tells his mortgage associate not to mention to the lender a second mortgage he has on a rental property. What should the associate do?

1. Leave it out, since the client's instructions override any duty owed to the lender
2. Refuse to proceed on that basis, as hiding the other mortgage is a material omission
3. Disclose it only if the lender's own credit check fails to show the other loan
4. Leave it off the application but mention it verbally to the lender's underwriter

The Guidelines define mortgage fraud to include a material omission relied on by the lender, and the borrower tip sheet flags a borrower who fails to provide highly relevant information such as another mortgaged property. Rules s. 41(j) requires a licensee to refuse further services to a client who instructs them to withhold a required disclosure, and s. 42(b) bars taking part in fraud.

34. Since what date have mortgage brokers been subject to FINTRAC's anti-money laundering and anti-terrorist financing requirements?

1. Since January 1, 2026, under the PCMLTFA and its Regulations
2. Since October 11, 2024, under the PCMLTFA and its Regulations
3. Since October 11, 2023, under the PCMLTFA and its Regulations
4. Since April 8, 2024, under the PCMLTFA and its Regulations

FINTRAC's page for mortgage administrators, brokers and lenders is marked effective October 11, 2024, and Regs s. 64.1(2), added by SOR/2023-194, brings a mortgage broker, defined as a person or entity authorized under provincial legislation to act as an intermediary between a lender and a borrower, within paragraph 5(i) of the Act. April 8, 2024 is only the date the page shows beside its link to the suspicious transaction guidance.

35. A mortgage associate works as an employee of a brokerage. Which FINTRAC obligation applies to the associate personally, and not only to the brokerage?

1. Reporting suspicious transactions, which binds both the employee and the employer
2. Large cash transaction reporting, which each associate files in their own name
3. None, since every FINTRAC obligation rests only on the brokerage as employer
4. The compliance program, which each associate must write and keep updated alone

FINTRAC's note for employees says the requirements are the employer's responsibility, except reporting suspicious transactions, which applies to both the employee and the employer. Regs s. 133(1) makes the employer rather than the employee responsible for complying with the Regulations, but the STR duty is set by s. 7 of the Act itself. Large cash reports and the compliance program stay with the brokerage.