Commentary
Canada has witnessed a rise in the criminal activity of money laundering. So much so, the word “haven” has been used by Canadian and international publications to describe how some criminals view our country. The federal government and provincial governments, including the recent example of Quebec, have attempted to curtail this long-standing problem. Whether these solutions will make a dent remains a huge question mark.
Money laundering is defined by Public Safety Canada as “a process used to disguise the source of money or assets that come from illegal means.” Criminal elements use these laundered funds in activities like fraud, forgery, and the black market for illegal firearms. Ottawa has “provided $319.9 million and $48.8 million ongoing to strengthen the Anti-Money Laundering and Terrorist Financing Regime,” according to Public Safety Canada. This has been used for “modernization of anti-money laundering laws,” “strengthening of inter-agency cooperation and information sharing” as well as “equipping law enforcement with tools and expertise to support investigations.”
Nothing is specifically wrong with these measures. Alas, it’s only a minuscule drop in the bucket when you consider that Maclean’s wrote this back in October 1989: “All available evidence suggests that international drug barons view Canada as a safe place to launder their illegal cash. ... In fact, DEA agents laughingly refer to Canada as the ‘Maytag’ of the money-laundering industry.” The problem has clearly festered in this country for decades, but preceding Liberal and Conservative governments were unable to end it.
What about Bill C-42? Prime Minister Justin Trudeau and the Liberals introduced this legislation in March to propose the establishment of a corporate beneficial ownership registry. The hope is that it would lead to more transparency and reduce tax evasion and money laundering.
It sounds fine in theory, but won’t necessarily work in practice. As Conservative MP Michael Chong pointed out, the Liberal bill only currently covers businesses incorporated under the Canada Business Corporations Act. Additionally, the bill “will not plug the hole that has allowed Canada to become a haven for sanctions evasion for the proceeds of crime, for the proceeds of terrorism, and for money laundering,” Chong tweeted on July 18. Many Canadian corporations will therefore remain vulnerable to the scourge of criminal activity.
Meanwhile, the Quebec government introduced draft legislation that attempts to crack down on criminals and money laundering.
The Canadian Press’s Jacob Serebrin wrote on July 27 that people who have either been convicted, or pled guilty to crimes like money laundering and forgery in the past five years would be banned from Quebec casinos. Loto-Quebec, the provincial gaming authority that owns all of the legal casinos (except those in the Indigenous communities), would be tasked with this responsibility.
“Loto-Quebec and the government are aiming for the highest standards of responsible gaming and financial integrity,” Claudia Loupret, a spokesperson for Quebec Finance Minister Eric Girard, said in a statement. “We have confidence in Loto-Quebec to implement these new measures.”
The draft legislation, which comes into effect in about six weeks, was initiated by two things. First, media reports that organized crime members had allegedly received VIP treatment at Quebec casinos. Second, a 2021 Deloitte audit that Girard reportedly ordered to specifically look into these allegations.
Why did it take over two years to introduce this legislation? Serebrin asked Girard’s office about this. He received no response.
While Quebec’s ban is forthcoming, and its potential impact unknown, one wonders if it could resolve B.C.’s enormous problem with money laundering. An 1,800 page report released last year by former B.C. Supreme Court Justice Austin Cullen studied the pattern of provincial laundering between 2008 to 2018 in areas such as real estate, luxury goods and casinos. “Sophisticated professional money launderers operating in British Columbia are laundering staggering amounts of illicit funds,” the report noted. “In 2014 alone, British Columbia casinos accepted nearly $1.2 billion in cash transactions of $10,000 or more, including 1,881 individual cash buy-ins of $100,000 or more – an average of more than five per day.”
On the surface, it seems unlikely to help. Although money laundering is a serious crime in Canada, far too many people get away with it. A Dec. 26, 2019, Toronto Star investigative report found that 86 percent of charges related to money laundering between 2012 and 2017 were either withdrawn or stayed, according to Statistics Canada’s Integrated Criminal Court Survey. It’s hard to see how Quebec’s ban, while well intentioned, will become an outlier.
Criminal elements will always take advantage of financial loopholes and political and judicial limitations in a particular country. If our governments are serious about cracking down on money laundering, more fundamental solutions are required to ensure our long-standing reputation as a haven for their illegal activities is eliminated for good.
Views expressed in this article are opinions of the author and do not necessarily reflect the views of The Epoch Times.
