Coffee Chatter - Money Laundering and BC's Real Estate.

Do we need more Levels of Government, or Efficiency of Existing Agencies.

• 
• By Nancy Smith
• Qualicum Beach REALTOR®
• Published: Feb 24th, 2020 at 4:53 pm

Coffee shop chatter topics hit on the money laundering in British Columbia. Someone commented that the Government, the RCMP, and other regulatory bodies are asking casinos and real estate agents to act as an extension to policing.

Today in this article from burnabynow.com, "Lapse in enforcement, effect on B.C. real estate market in focus as money laundering inquiry opens", this quote is especially concerning.

Judith Hoffman, general counsel for the federal government, began by saying the inquiry is a provincial one but money laundering “obviously has many federal dimensions.” Ottawa is assisting the inquiry to understand the scope of the problem in B.C. and the effectiveness of federal enforcement, she said.

Hoffman said new federal regulations are coming for foreign virtual currencies that have yet to face the kind of regulations that govern credit cards or bank accounts. Likewise, cryptocurrencies present similar oversight issues.

Cullen interjected at one point to note that the commission may want to specifically look at trade-based money laundering and may seek federal help in better understanding current efforts to address it.

Hoffman addressed a maze of federal agencies whose work falls under the umbrella of the Proceeds of Crime (Money Laundering) and Terrorist Financing Act.

The Financial Transactions and Reports Analysis Centre (FINTRAC) “has an enormous mandate,” with upwards of 25 million reports annually, Cullen said.

“I am interested in perhaps turning Canada’s attention to that,” he told Hoffman.

Hoffman noted the interconnected roles of FINTRAC, RCMP, the Canada Revenue Agency, the Canadian Security Intelligence Service and the Office of the Superintendent of Financial Institutions, which regulates banks and money service businesses. The Canada Mortgage Housing Corp. also plays a role as the federal regulator of housing policies.

Using money service businesses as an example, Hoffman explained how the RCMP’s Combined Forces Special Enforcement Unit is working with the B.C. Attorney General and City of Richmond on a provincial licensing program.

Both senior governments are looking at new regulations for greater transparency in business ownership.

Hughes spoke about B.C.’s ongoing public consultation process to create a provincial public registry of corporate beneficial ownership, as it has done for property ownership – key recommendations of the Expert Panel on Money Laundering in Real Estate, commissioned by the province in 2019.

That panel provided a broad picture of money laundering in B.C., estimating that between $800 million and $5.3 billion was cleaned through B.C. real estate in one year.

It appears we have so many layers of control, why is it necessary to add more layers when apparently, the existing departments and agencies are unable to cope, due to lack of funding, skilled people and equipment. In fact, if a few agencies were deleted, like FINTRAC, and the resources dispersed, efficiency might improve?

Coffee chatter is always interesting, but there are only questions and no answers.

PS  When the province built the bypass highway around Nanaimo, BC, completed in 2002, the 'old highway 19A' through the City of Nanaimo was still under the umbrella of the Provincial Government.  For years, those two agencies could not coordinate traffic lights along the 19A route.  If two government agencies could not resolve a simple issue, how will six, ten or twelve agencies solve anything?