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w w w . C A N A D I A N L a w y e r m a g . c o m N O V E M B E R / D E C E M B E R 2 0 1 6 29 ate in the Wild West, free of any regulatory checks. While it's true that the business models and financing methods of some fintechs like Mogo, Vancouver-based Grow and Toronto-based Borrow- ell are not examined by OSFI even though they lend money to Canadians, they nevertheless have multiple regulations to which they must adhere. Canada's overlapping federal and provincial regulations, with different regulatory bodies responsible for dif- ferent elements of the financial system, be it financial, securities, consumer protection and privacy, are bewilderingly complicated to navigate. "One of the challenges any business has, and more so with fintechs who have a smaller budget to allocate to compli- ance, is the nature of provincial regulations across Canada," says Zaman. Fintechs, Badour points out, are regulated depending on their line of business. Those in the payment space would have to comply with federal anti-money-laundering legislation as well as provincial consumer protection and privacy legislation, while securities legislation would cover business models such as online advising, peer-to-peer lending, crowdfunding platforms and angel investor organizations. Figuring out what laws apply to what products is almost always a time-consuming headache, says Lisa Skakun, chief legal and administrator at Mogo. "It's a lot of regulators," adds Skakun. "It's a lot of legislation. Each province can have nuanced legisla- tion, with different requirements. It hampers the speed of growth because it takes time to understand each province's legislation. For companies without legal departments it is a challenge to fully research, maintain and be compliant. It's definitely a barrier to entry." Regulatory uncertainty also does not help, and can actually impede innovation in the early stages due to higher risks and increased costs. Marketplace lenders, for instance, might be cov- ered by provincial securities laws, though no one is certain. That's the conundrum that nanoPay, an early-stage fintech company that provides loyalty and payment solutions for retail and ecommerce merchants, faces. The Toronto-based upstart, which last Decem- ber acquired MintChip, a digital currency product developed by the Royal Canadian Mint, lies in between the cracks of the regu- latory system, says Tracy Molino, nanoPay's general counsel and chief compliance officer. It doesn't help that Canada's Parliament approved the world's first national law on digital currencies more than two years ago, but it has yet to be enacted. When the rules come into force, entities involved with digital currencies will have to register with Canada's financial intelligence unit, the Financial Transactions and Reports Analysis Centre of Canada (or Fintrac). Until then, Fintrac has curiously taken a hands-off approach even though the director of Canada's anti-money-laundering watchdog said this summer that the agency is studying the vulnerability of certain emerging technologies, like those being pioneered by fintechs, to "criminal exploitation." "There needs to be a rational basis to determine which entities are subject to regulation or not because right now the answers are all over the map," says Matthew McGuire, an anti-money- laundering and counter-terrorist financing expert. New in this edition Case Law Highlights • Goodwin v. British Columbia • R. v. Lloyd • R. v. Borowiec • R. v. Safarzadeh-Markhali • R. v. 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