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Money laundering report a wake-up call for Canada, but some provinces skeptical

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VANCOUVER — The authors of a report that found $47 billion was laundered across Canada last year debated whether to include a graph that indicated Alberta, Ontario and the Prairies were hotspots for dirty money, says the lead writer.

Maureen Maloney said her expert panel used the best mathematical model available to reach the estimates, but it’s more reliable at a national level than a provincial one, so they questioned whether to publish the figures.

“But we thought, ‘No, we need to do this, because people need to know it’s not just a B.C. problem,’ ” said Maloney, the province’s former deputy attorney general and a public policy professor at Simon Fraser University.

“It’s a big B.C. problem, but it’s everybody’s problem. And to the extent that B.C. starts fixing our problem or at least makes our province less enticing to money launderers, they’re going to go elsewhere. They’re not going to disappear.”

The report, one of two recently released by the B.C. government, aimed to sound a nationwide alarm about money laundering. But some provinces have reacted with skepticism, as Alberta questioned the numbers and Ontario said it will monitor the issue.

Maloney said there is no reliable data on money laundering in Canada, so the panel used what’s known as the gravity model, which estimates the flow of dirty money between countries based on characteristics including GDP per capita and crime rates. The panel divided Canada into six regions and treated each region as a country.

The panel estimated that Alberta led the country for money laundering in 2015 with $10.2 billion, followed by Ontario with $8.2 billion and the Prairies — Saskatchewan and Manitoba combined — with $6.5 billion.

To the surprise of many, B.C. came in fourth with $6.2 billion, scuttling its reputation as the money laundering capital of Canada.

The authors noted that the relatively high estimates in Alberta and the Prairies might arise from the importance the model places on crime rates and GDP levels, which were high prior to the oil downturn.

“If money laundering in Alberta and the Prairies have been overestimated … that implies that money laundering in B.C., Ontario and Quebec have likely been underestimated,” the report said.

Still, the panel concluded that money laundering is corroding “the very fabric of society” across Canada, and laid out a vision for it to become a national priority. Multiple recommendations call for the B.C. government to persuade its provincial and federal partners to take action.

Other provinces have yet to confront the issue with the zeal of B.C., which announced this week it will hold a public inquiry.

Alberta Justice Minister Doug Schweitzer said the province takes criminal activity seriously, but the figure presented in the report is the product of modelling that may not be completely reliable.

“We use intelligence from front-line law enforcement agencies, not data we can’t verify. We will continue to work with our law enforcement partners to protect law-abiding Albertans,” he said in a statement.

Money laundering is nearly impossible to quantify because, by nature, it’s hidden, but the report’s estimate for Alberta seems high, said Greg Draper, a national lead of valuations, forensics and litigation support with law firm MNP LLP and a former RCMP investigator based in Calgary.

“I would expect that Vancouver has a bigger issue than Alberta, which is not to say that Alberta does not face its own money laundering risks,” he said, adding illicit money is being washed through the province’s casinos, housing and cash businesses.

Ontario’s real estate association was so alarmed by Maloney’s report that it contacted its provincial government to call for a beneficial ownership registry. B.C. has already announced plans for such a registry, which collects the names of people buying property using corporations, trusts and numbered companies.

“Today, drug lords, gun runners and other criminals can hide behind the veil of Canada’s privacy laws,” said Tim Hudak, chief executive officer of the Ontario Real Estate Association and a former provincial Progressive Conservative leader.

Ontario Finance Minister Vic Fedeli wasn’t available for an interview and in a statement his department didn’t indicate it was planning to take any urgent action.

“What I can tell you is that we are discussing this issue with our federal and provincial partners — most recently at the last meeting of Canada’s finance ministers. This is something we will continue to monitor,” said spokesman Peter Spadoni.

Both Saskatchewan and Manitoba said they are taking measures to combat money laundering and pointed to their civil-forfeiture programs, which enable provinces to seize assets believed to be the proceeds of crime without laying criminal charges.

Saskatchewan added that it will pursue legislative amendments to ensure that corporations hold accurate and up to date information on beneficial owners. But it noted it was difficult to draw conclusions about the province from the Maloney report.

“The report itself states there are limitations on the methodology, so it isn’t clear what proportion of the Prairie figure in the report applies to Saskatchewan,” it said.

Jason Childs, an economics professor at the University of Regina, said he would expect money laundering to be worse in B.C. due to its sky-high real estate market, but Saskatchewan’s gaming industry is extremely vulnerable.

“We have a lot of comparatively small casinos that are going to be operating with different levels of oversight,” he said. “And then you’ve got, also, a lot of cash business going on in Saskatchewan still.”

As for the federal government, Prime Minister Justin Trudeau described the reports as “alarming” and said his government has strengthened audits on real-estate transactions and is working with provinces to do more.

Maloney said better data is needed, but if anything, the panel’s estimates might actually be lower than the reality.

“Our numbers are not definitive. Nobody’s numbers can be definitive. But we think at the moment, given the data that is available to us, this is probably the best guesstimate there is,” she said.

“But I would say if we were erring on any side, it would be on a cautious, conservative side.”

— Follow @ellekane on Twitter.

Laura Kane, The Canadian Press


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International

People planning to attend AIDS conference in Montreal still struggling to get visas

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MONTREAL — International AIDS organizations say people from Africa, South America and Asia who are planning to attend a major AIDS conference in Montreal are still struggling to get visas from the Canadian government.

The groups say a growing number of activists — including some who were scheduled to speak at the conference which begins at the end of the month — are having their visa applications denied, often on the grounds that the Canadian government doesn’t believe they’ll return home after the event.

Tinashe Rufurwadzo, the director of programs, management and governance at Y+ Global, an international organization of HIV+ youth, said the chair of his organization’s board and another of its employees, who are based in Malawi and Kenya, are among the young activists who have been denied visas to attend the conference.

He said both have travelled extensively to speak at AIDS-related events.

“Personally, I’m sick and tired of seeing young people from Africa mostly portrayed on PowerPoint slides as pictures, as photos on banners, as footnotes on case studies. Why can we not have them at conferences to share their lived experiences of what exactly is happening?” he said in an interview Friday.

Rufurwadzo said representatives of populations most at risk of HIV — such as people who inject drugs, transgender women, sex workers and gay men — need to be able to participate, as do adolescent girls, who are increasingly affected by HIV.

If people from the most affected countries aren’t able to attend, he said he doesn’t know how realistic the learning at the conference will be.

While those whose applications are denied will be able to attend the conference virtually, Rufurwadzo said that won’t allow the same level of participation. He also said young people, especially those from rural areas, may not have consistent access to the internet.

Last week, almost 250 organizations from around the world sent a joint letter to Immigration Minister Sean Fraser calling on him to take action to ensure participants can attend the International AIDS conference.

Aidan Strickland, a spokesman for Fraser, said in response to earlier questions from The Canadian Press that the department has been working closely with event organizers and that applications “have been assessed in a timely manner.”

“While we cannot comment on the admissibility of any particular individual, we can say that, in general, all visitors to Canada must meet the requirements for temporary residence in Canada, as set out in Canada’s Immigration and Refugee Protection Act,” Strickland said in an email. “All applications from around the world are assessed equally against the same criteria.”

Javier Bellocq, an Argentine who runs a community journalism project called the Key Correspondent Team which focuses on people living with HIV and high-risk groups, said from the stories he’s heard, it seems like each Canadian consulate is applying different rules.

In some places, he said, applicants have been required to pay for medical examinations as part of the visa process.

“The conference, in theory, arranged with the Canadian government that there will not be medical examinations, but there are, there are many medical examinations.”

Of a group of 40 Argentines, including Bellocq, who are planning to participate in pre-conference activities, only two have received visas so far, he said.

Tumie Komanyane, who runs programs for international NGO Frontline AIDS in South Africa, said groups she works with were planning to help more than a dozen young people attend the conference, but decided not to even bother applying for 10 visas after the first four applications were rejected.

Komanyane said she’s aware of other young people from the region, including some who had scholarships to attend the conference funded by the Canadian government, who have had their visa applications denied.

“It’s incoherent,” she said in an interview Saturday. “With the strides that Africa is making in the HIV field, all the lessons and evidence that could be coming from the beneficiaries directly is going to be lost.”

While she works with young people, she said, she doesn’t want to speak for them.

“They have agency, they have voice, and they shouldn’t be represented by people like me. They should be able to go and share what this work means for them,” she said.

Bellocq said he’s not worried about himself, noting the Argentine passport is relatively powerful and he’s a professional who has been travelling internationally form more than 30 years. But he worries about people  from countries with less passport privilege and members of marginalized groups who are at high risk of HIV.

With pre-conference events starting in just over three weeks, he said, “time is not on our side.”

This report by The Canadian Press was first published July 2, 2022.

Jacob Serebrin, The Canadian Press

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Crime

B.C. RCMP identify twin brothers as B.C. bank shooting suspects

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Victoria – Twin brothers in their early 20s were responsible for the shooting that injured numerous police officers at a bank in Saanich, B.C., earlier this week, RCMP alleged Saturday.

Mounties spokesman Cpl. Alex Bérubé named the men as 22-year-olds Mathew and Isaac Auchterlonie from Duncan, B.C.

Six officers were shot and the brothers were killed in the shootout with police on Tuesday outside the Bank of Montreal branch.

Bérubé said officers have spoken with the twins’ relatives, who are co-operating with the investigation.

Investigators are looking into the suspects’ backgrounds, and he said neither man had a criminal record or was known to police.

“We understand that the release of the names of the two deceased may answer the who, but there are still many outstanding questions and investigation efforts that need to take place in order to fully understand what took place and why,” Bérubé told a news conference.

“The motive behind the armed robbery and subsequent exchange of gunfire with police has not yet been determined.”

Police have also confirmed that the twins are associated with a white four-door 1992 Toyota Camry that has two black racing stripes over the hood and roof, Bérubé said.

The car was found with multiple explosives, which were removed and destroyed last week

Bérubé said the investigation has so far determined that there were only two suspects in the bank.

“However, we are continuing to look into whether anyone else was involved or associated to the events on Tuesday.”

An update on the condition of the injured officers wasn’t given.

Earlier, Saanich Chief Const. Dean Duthie had said three of the officers remain in hospital, including one who is in intensive care while another will require more surgeries.

This report by The Canadian Press was first published July 2, 2022.

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