The Liberal government is looking to set up a new federal law enforcement agency dedicated to financial crimes, a dramatic undertaking to shake up how money laundering and fraud are investigated in Canada.
“Canada has just, what feels like all of a sudden, established a new federal police agency,” said Jess Davis, president at Insight Threat Intelligence.
“That’s a big deal.”
Tuesday’s spring economic statement promises to stand up the Financial Crime Agency, which the Liberals are calling the “first-ever federal law enforcement agency dedicated to investigating serious and complex financial crimes and recovering the proceeds of crime.”
The proposed agency, outlined in Bill C-29 which was quietly tabled on Monday, would be given police powers. It is designed to lead investigations into Canada’s most intricate and costly financial crimes, operating under the oversight of a commissioner.
The update said the goal for the agency is “to identify, trace, and seize illicit money to disrupt and dismantle drug trafficking, extortion, fraud, and other organized criminal networks that threaten the safety of our communities and the integrity of our financial system.”
Historically, high-level financial crime and money laundering have been investigated by the RCMP through its federal mandate.
An official with the Finance Department said the Financial Crime Agency will be distinct from the RCMP, with its own police officers who would be able to execute search warrants and make arrests.
The bill does say the agency may borrow Mounties during its nascent years.
The update says the agency would also be staffed by civilian investigators, criminal and financial intelligence personnel, asset recovery experts and specialized prosecutors.
Davies, a prominent Canadian expert in terrorist financing and money laundering, said the agency proposes to tackle what has become a “significant problem” in Canada.
The Financial Transactions and Reports Analysis Centre of Canada identified $44 billion of transactions that it had reasonable grounds to suspect were relevant to investigations into money laundering, terrorist financing or threats to the security of Canada in the 2023-24 fiscal year.
“If these transactions were contributing to Canada’s legit economy, it would probably be in the Top 20 sectors contributing to our GDP,” said Davies.
Everyday Canadians also face the brunt of financial fraudsters.
Canadians reported losing more than $704 million to fraud in 2025, bringing total reported losses since 2022 to over $2.4 billion, according to the Canadian Anti-Fraud Centre.
With financial fraud widely unreported, that number is likely higher.
Davies said it’s hard not to see the Liberals’ move to create this agency as a comment on the RCMP.
“This is very much a reaction to the RCMP’s inability to do this job,” she said.
Some of that comes down to the RCMP’S structure, Davies said. On top of its federal policing obligations, the RCMP is also responsible for boots-on-the-ground policing across the country, which has drained its resources over the last decades.
A 2023 report from the National Security and Intelligence Committee of Parliamentarians called on Ottawa to create a stand-alone federal policing organization. It found the RCMP’s sprawling mandate is undermining its investigations into files such as national security and financial crime.
“Ultimately what we’re going to see is the move of most significant financial crimes files out of the RCMP and into this new agency, and this is by design,” said Davies.
The finance official said the RCMP often has to focus on going after the biggest fish, and financial crimes don’t always get as much attention. They called that a “gap,” but said they don’t see it as the RCMP dropping the ball.
The federal minister responsible for the RCMP dismissed a question about whether the new agency is being formed in response to the force’s performance on financial crime files.
Public Safety Minister Gary Anandasangaree said the government wants to have a “laser-sharp focus” on financial crime, while also hiring more Mounties to work in federal policing.
“There is a need for increasing our vigilance and our enforcement of financial crimes that are often now transnational,” he said at a news conference in Toronto on Wednesday
The RCMP deferred questions about how it will work with the new agency to the Finance Department.
The Liberals have been pitching a stand-alone agency for years, going back to their 2021 budget. But the introduction of a bill suggests the government, now in majority territory, is keen to move forward.
Once passed, the government said it will look for a commissioner who will help decide the makeup of the organization and how these new police officers will be trained.
The spring update commits nearly $353 million over five years starting in 2026-27, and $82 million per year after that to stand up and fund the Financial Crimes Agency.
There’s also around $46 million over five years and $11.5 million per year ongoing to the Public Prosecution Service of Canada, and $20 million over five years and $1.5 million per year ongoing to the Department of Finance Canada.
“This is a big step. We don’t get a new federal police agency every day,” said Davies. “I think it’s really important that everybody have a chance to comment on this legislation, that political parties really kick the tires of the legislation and hold the government’s feet to the fire about what they’re trying to achieve, how they’re going about doing it.”
