‘Not going to be an easy task’: money laundering report to be released

VANCOUVER (NEWS 1130) – Money laundering and trans-national organized crime will be the focus as a major report on the province’s efforts to tackle problems in BC’s gambling industry is released later this morning.

Attorney General David Eby ordered the review last year after a report was released saying a Vancouver-area casino accepted $13.5 million in $20 bills over one month.

Eby tasked former RCMP deputy commissioner Peter German with determining whether money laundering is an issue in BC casinos and making recommendations.

Financial crime expert Garry Clement — former national director of the RCMP’s Proceeds of Crime Branch — had some early involvement in German’s investigation and he suggests there is a large amount of dirty money flowing through casinos and into the real estate industry.

“What we are seeing is a lot of shell companies, a lot of numbered companies, being involved in acquiring property without knowing who the beneficial owners are,” he tells NEWS 1130.

“As a result of that, I think we are seeing extensively that Vancouver is being used heavily by trans-national organized crime.”

Clement — who is also a former RCMP liaison officer in Hong Kong, familiar with Asian-based organized crime — believes that mandatory disclosure of ownership will be among the 40 recommendations to be revealed today.

“Minister Eby has already alluded to it in as much as there is definitely a need for full disclosure of beneficial ownership. That’s something that will be required by the federal government. You can incorporate a company online in about 15 minutes and the beneficial owners may never be known. The fact that the legal community helps incorporate these numbered shell companies without disclosing the beneficial owners needs to be closed,” he says.

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Clement believes Eby will bring in a property registry, requiring the actual owners be listed.

“These would be a good start and we have already seen some strong controls being put into the casinos in British Columbia which, in my view, are long overdue,” he adds.

“I would also hope that there are some recommendations around the type of enforcement required because I think it is sadly lacking today in this whole arena. Maybe even going so far as to recommend to the federal government to go back to the integrated financial crime or proceeds of crime units which were a success back in the early 1990 and sort of disappeared in the mid-2000s.”

However, Clement says it will be a challenge to implement some of German’s recommendations.

“You have to understand that organized crime groups have become far more sophisticated than they were 30 years ago. They’re using everything available to them, from electronics to the dark web to cryptocurrencies. All of this is going to continue but if we don’t start getting on top of it, we will never ever get control of it.”

Clement commends Attorney General Eby for facing problems in BC casinos and trying to stem criminal activity.

“The minister has had the audacity to open it up. He’s identifying the problem and I have confidence the report coming forward from Peter German will be articulated extremely well, be balanced and measured and, as a result, I think some of the recommendations will be doable in the short term,” he says.

Clement feels others will require long term solutions and “real thought leadership” in order to make them successful.

Peter German’s review of BC’s anti-money-laundering policies and practices in the gambling industry is due out at 9:30 this morning.