Regulation

Money Laundering Runs Rampant On Canadian Border

Law enforcement officials are seeing a rise in money laundering cases in Canada, and some say the country isn’t doing enough to clamp down on the criminal activity.

In fact, when British Columbia’s Attorney General David Eby was briefed by law enforcement officials last year on alleged money laundering in his province, the scale of activity “blew my mind,” Eby said, according to The Wall Street Journal. Eby added that he was embarrassed to learn that Australian authorities had even dubbed a common tactic carried out by Chinese gangs, where illicit money is processed through casinos, as “the Vancouver method.”

Canada’s financial intelligence agency, the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC), recently revealed to lawmakers that more than two-thirds of Canadian banks that it looked into had “significant levels” of noncompliance when it comes to anti-money laundering (AML) rules. The Royal Canadian Mounted Police estimated in 2011, which is the most recent year for available data, that between $5 billion and $15 billion CAD ($3.8 billion to $11.5 billion USD) is laundered in the country every year.

“Canada must immediately take action in order to change the perception that it welcomes, or even encourages, corrupt behavior,” said Marc Tassé, head of the University of Ottawa’s Canadian Centre of Excellence for Anti-Corruption, to a parliamentary committee.

While the country’s finance ministry said it takes the fight against money laundering seriously, Canada logs few money laundering convictions compared with other countries. From 2000 to 2016, Canada had convictions in 316 money laundering cases, according to Statistics Canada. Compare that to the U.K., where prosecutors recorded more than 1,400 money laundering convictions last year alone.

Critics of the way Canada handles money laundering say several factors interfere with the country’s attempts to pursue criminal charges, including strict privacy laws that make it difficult to obtain warrants, a reluctance to prosecute and the failure of some banks to report suspicious transactions.

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