Case Study: Rapid API Integration to Overcome the FINTRAC Shutdown
How Rhizome helped Phantom Compliance rapidly file backlogged reports
Executive Summary
When the March 2024 FINTRAC security breach forced a sudden migration to a new API, Phantom Compliance's existing automation pipeline was instantly rendered obsolete. Facing a critical technology gap and a massive backlog, they partnered with Rhizome Compliance. We deployed our API-native platform in record time, enabling them to file nearly 2,000 reports ahead of schedule and transforming a potential crisis into a permanent technology upgrade.
The Challenge: A Sudden Technology Mandate
Phantom Compliance, a compliance services company specializing in serving Canadian MSBs in the cryptocurrency sector, had an automated system for managing its clients' high-volume FINTRAC reporting. However, the unexpected FINTRAC shutdown in March 2024 and the subsequent mandate to use the new Gen 2 API created an immediate crisis. Their existing tools could not yet interface with the Gen 2 API, leaving them with no way to file. Nor would it be practical to do manually, due to the sheer volume of reports.
With a non-negotiable deadline looming and a backlog of transactions growing daily, the challenge was clear: find a partner who could bridge this complex API gap immediately, without requiring a lengthy and resource-intensive internal development project.
The Solution: An Agile, API-Native Platform
Rhizome's platform is built on modern principles derived from years of developing infrastructure for major financial institutions. This architecture allowed us to deliver a solution with exceptional speed.
Instead of a months-long integration project, we provided a direct path to compliance. Phantom supplied their raw transaction data, and our platform handled the entire technical process: transforming the data, generating thousands of compliant Large Virtual Currency Transaction Reports (LVCTRs), and transmitting them directly through our pre-built integration with FINTRAC's Gen 2 API. The entire solution was deployed and operational in a fraction of the time of a typical custom build.
The Results: Crisis Averted, Capability Advanced
The immediate result was the successful filing of nearly 2,000 LVCTRs, clearing the entire backlog in under two weeks, and ensuring Phantom's clients were compliant in time for the newly imposed deadline.
More significantly, what began as an emergency fix became a permanent strategic upgrade. By partnering with Rhizome, Phantom leapfrogged a complex development hurdle and enhanced its core operational capacity. They continue to batch-file reports weekly using our technology. This newfound efficiency and technological resilience allow them to confidently pursue larger clients, report in new jurisdictions, and adapt to future regulatory shifts with ease.
Rhizome came along at the perfect time for us. Their platform delivered on every promise. The entire solution was operational well ahead of schedule, and provided the exact solution we needed to navigate the shutdown.
Ryan Mueller, CEO, Phantom Compliance
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