That makes British Columbia and Canada a haven for money launderers



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Money is not a problem strictly in casinos.

John Lehmann / Globe and Mail / John Lehmann / Globe and Mail

This week, British Columbians taught the price paid by ordinary people for money laundering by organized crime.

Cash is not a problem for casinos and luxury car trade. It involves thousands of dollars tumbling through the real estate market, inflating prices at a time when residents are struggling with unaffordable housing.

The bi NDP government has now released the latest installment of a series of reports of money laundering. The governmental experts have established that large-scale, transnational money laundering by organized crime has taken over the provincial economy – an estimated $ 5 billion only in the real estate sector last year.

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B.C. Attorney General David Eby plans to meet with Federal Organized Crime Reduction Minister Bill Blur to discuss further steps and the Bc. The Cabinet will soon decide whether to call a public inquiry.

But the investigations of B.C. Have revealed that the province is not alone in its challenges. Ontario, Alberta and the Prairie face similar problems. "This issue feels like a national level crisis" Mr. Harry told reporters this week, a crisis that threatens confidence in the Canadian economy.

On Friday, speaking to reporters in Edmonton, Prime Minister Justin Truduu called the findings "utterly alarming," and promised action. "This is a real and urgent problem for Canadians, and it is a problem around the world that Canada will continue to fight it."

Money laundering inflows and outflows

2015

Canada is both an optician and a sender of

Criminal money laundering. The chief

Estimated inflow from the United States

And from Europe.

Direction of Criminal Cash Flow

Note: Arrow thickness tells

To the amount of money.

CARRIE COCKBURN / The globe and mail,

Quarter: Ministry of Finance

Money laundering inflows and outflows, 2015

Canada is a receiver and a criminal of money

For laundering. Mostly estimated inflow is coming

From the United States and from Europe.

Direction of Criminal Cash Flow

Note: Arrow thickness refers to the amount of money.

CARRIE COCKBURN / The globe and mail,

Quarter: Ministry of Finance

Money laundering inflows and outflows, 2015

Canada is a receptionist and a singer of criminal money for laundering.

The main estimated inflow comes from the United States and Europe.

Direction of Criminal Cash Flow

Note: Arrow thickness refers to the amount of money.

CARRIE COCKBURN / The Globe and Mail, Source: Ministry of Finance

CASINOS AS LAUNDROMATS

The reports kicked off with Dirty cash, which was released in June, 2018, and looked at money laundering at lower Mainland casinos.

In the report, the former RCP Deputy Commissioner Peter German said, for many years, local casinos "unwittingly served as laundromat for the solution of organized crime." He cataloged a host of problems, including a flagship anti-money-laundering software system, such as "German", a "debacle" – and a confusing, ineffective, regulatory regime.

The report released with video showing people entering casinos with shopping bags and oversized handbags full of money, neatly stacked and kept together with what looks like rubber bands. It described the Vancouver model, a system in which money was laundered and out of Vancouver to other locations, including Mexico and Colombia.

In one instance described in the report, investigators determined that $ 13.5 million, mostly in $ 20 bills, had passed through one cash casino's cash cages in a month.

Canada needs to keep being dirty for 24 hours laundromat

Mr. German's first report received 48 recommendations, including a Transaction Analysis team should be set up and meet at least weekly reports to report all suspicious transactions.

The British Columbia Lottery Corporation (BCCL) says the number and value of suspicious Transaction Reports has plummeted, with the value of such reports falling from $ 27 million in July 2015 to $ 1 million in March, 2019.

Under BCLC rules that have effect in January, 2018, casinos in BIQ. Required to collect detailed information on the source of player money for all transactions of $ 10,000 or more.

These changes have an impact on casino operators.

Big Canadian Gaming Corp., which runs the River Rock Casino in Vancouver and other gambling venues, including the Hastings Rascurs (also in Vancouver), said in its first-quarter report that revenues in 2018 decreased from the previous year to "a part of The decrease in gaming revenues … due to the BLCC source-of-money procedures. "

As this week's Real Estate Report, the casino report highlighted as existing regulations, including reporting requirements of financial transactions, and Reports Analysis Center of Canada (Fintrak), the federal money-laundering watchdog, did not want the desired effect.

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It was a theme for Ayi returning to his Thursday press conference. "Many, many reports have been filed with FinTRAC of our casinos about bulk money transactions with little clear-cut action," he said.

Estimated money laundering in Canada

Money laundering in Canada is currently underway

In the tens of billions of dollars. Estimated

Money laundering amounts in Canada,

In billions of dollars.

The Globe and Mail, SOURCE: Ministry of Finance

Estimated money laundering in Canada

Money laundering in Canada is currently in the tens

Of billions of dollars. Estimated amount of money

Launching in Canada in billions of dollars.

The Globe and Mail, SOURCE: Ministry of Finance

Estimated money laundering in Canada

Money laundering in Canada is currently in the tens of billions of dollars.

Estimated amount of money laundering in Canada, in billions of dollars.

The Globe and Mail, SOURCE: Ministry of Finance

Fast cars, clean money

Mr. German singles out luxury vehicles for slippery. He found that the province's inability to split money laundering by car sales can be traced back to financial tracking by provincial and federal watchdogs. Unlike banks and casinos, car dealerships are not required to report large or suspicious transactions to Fintrak.

Mr. German found that the provincial authority, BC vehicle sales authority, focused on consumer protection, and that vehicle industry associations do not see money-based sales as a significant concern. Because dealers deposit money from vehicle sales to mainstream financial institutions, it's a complete lack of visibility.

Interviews with a number of B.C. Car dealers discover the way of their business commodity hypactic transactions, ranging from accounting six-figure, non-question-asked cash sales, to a non-cash cash policy amounting to over $ 9,999. The German report called the latter amount interesting, as it is the maximum amount of a Fintrac Reporting entity, such as the dealers' deposits with the financial institution, can accept without submitting a large cash transaction report.

German Report displays large money-laundering in luxury cars market

The German report cited one scheme operated by a high-level drug dealer who acted as a broker to lead buyers to a particular company. He would make a big money deposit on a car finally and the individual would sign a Multiyear lease. In six months, finally, would return and rent a more expensive car with an additional deposit. According to the report, it can finally repeat the process multiple times and simply return to the dealership and ask for some of its deposits to be reimbursed by company checks, rendering the money clean.

In other cases, gangsters would take advantage of BS. It's rapidly growing gray market from overseas. More than 4,400 vehicles were exported to China in 2018, according to the Ministry of Finance's data. Straw buyers are hired to buy domestic vehicles. Therefore, the report says that vehicles would be overseas where the International Market provides massive profits.

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The Phentanil Crisis was too much attention to monitor goods imported from overseas, though such stolen vehicles can be slipping through the results, according to the Canadian Insurance Board. Earlier this year, Inspector Brian McDonald – the in charge of the integrated municipal provincial auto crime team (Impact) – said he remained concerned that "no one is working our ports as they should be."

A LIGHT TOUCH: & # 39; Regulating real estate

A local professionals' employer is inevitably ending up in Beks's real estate sector, as well as gatekeepers who facilitate the laundering of dirty money through organized criminals, reports released this week.

The real estate industry as a whole is characterized as being subject to "light-touch regulation" with some professionals subjected to heavy-duty province and federal shunting while others are not, Mr. German's report stated.

"The result is that we can see the rat like it burrows through parts of the industry but lose sight of it in other parts, only to find it emerge in yet another," his report stated.

Real estate brokers, realtors, developers and some 300-od notaries in the province are required to report suspicious transactions to Fintrak.

But mortgage brokers, private lenders and lawyers – key links in the range of property ownership – don't have to report to FinTRAC and both recommended federal laws are amended to bring the professions under the regulatory regime.

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Dirty money driving up b. Home prices are more than $ 40 billion laundered across Canada in 2018

The provincial regulator of mortgages told Mr. German's team that it had a "less-than-optimum window" about how many unlicensed mortgage brokers, private lenders and mortgage investment corporations are operating. These firms are cash launch targets because there is "no frequency in terms of who acts as a lender and no overweight in terms of their funding source or the payment back of mortgages."

Defendant across the country has been reported to report to Fintrak since the 2015 Supreme Court of Canada has decided on a federal law federation, which has argued that doing so would have infringed on private advisers. Parliament has yet to develop a workaround – such as developing a third party database, which only records the name of a client and the money they have deposited – which could protect lawyer trust accounts of money laundering.

Provincial Law Societies have stepped in to impose rules to help their members counter this sophisticated crime, but bc. Has some of the strongest regulations in the country and still has some loopholes, notably German.

Bill McCarthy, a Burnaby-based real estate developer and long-time realtor with a host of other professional designations, said it was an open secret in his industry that clients often try to pay deposits or even buy a home with their money. In the end, he said, no and all professions involved in buying and selling property should account for Fintrak because he said bad elements can always find partners.

"I don't think anything in the German report has surprised those in the real estate, legal and mortgage businesses," Mr. Macedonian. "The bulk and weight maybe, but not the details of it, and that's a problem."

Cash is flowing in an unexpected place

Closing gaps in enforcement and regulating criminals from laundering very dirty money in British Columbia's economy is playing the arcade game Whac-a-Mole: Knock down one problem, and another pops up.

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In his latest money laundering report, Mr. German dedicated a complete chapter to what he calls the Wen-a-times Phenomenon – when organized crime moves from one sensitive industry to another.

The problem, Mr. German found, is that many sectors of the economy have no conduct to report suspicious transactions. When an individual goes into an auction house or law firmly with big sums of money, officials in Fintrak don't hear a thing.

Canada needs a uniform report to report large cash transactions, he found. "Universal reporting, as it stands in the US, is the easiest way to close the gap."

B.C. Clamped down on money laundering in his casinos last year, but here are a few of the other creative things about organized crime that can still be money-laundered without question.

Buying Spray, Obscured Ownership: Report Reveals Red Flags Of Money Launching In BS & # 39; s property market

Luxury toys and adornments: "Much the same as luxury vehicles, speed boats and other luxury craft are popular items in what organized crime can park their money and still have the use of the item, until they recover most of their cost when releasing. Also noted that many high-end homes in Great Vancouver contain pianos valued in excess of $ 100,000, even if they are gone, never played, they are an easy parking spot for money and will retain much of their worth until resale.

Post-employment Institutions: the BI Government is regulating a top line of money laundering to encourage insiders to come forward. Some of the leaders described tactics where international students sign up for programs, pay their fees in cash, and then cancel before classes begin. They then get a refund check. "On a recent occasion, one college faced a student who was required to pay a fee of $ 150. Student attended by $ 9,000 in a duffel bag and asked to deposit the amount less than $ 150. In fact, the institution was asked to act as a bank. "

Money Service Business: MSBs are informal banking systems that can move cash electronically to remote locations – without international cash transfers – through settling accounts via email, vetchat or other informal means.

They have become a fixture of the urban Canadian financial system, Mr. German said, and "very little, if any, attention has been paid to unreasonable MSBs, who are moving substantial amounts of money on a daily basis. Those who register are subject to regulatory overhaul. Those who do not register are off the proverbial radar screen. "

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