PORT COQUITLAM (NEWS 1130) – The mayor of Port Coquitlam is fired up, after hearing the details of reports done for the province, which found $7.4 billion was laundered in B.C. last year.
The reports found $5 billion was laundered in real estate, resulting in a five per cent hike in home prices.
“I’m no longer saying I’m surprised about any of this stuff. What I am is pissed off and angry,” Mayor Brad West said. “It’s just unbelievable that this could have happened in this province and no one lifted a finger to do a damn thing about it.”
He says too many people have been priced out of their own communities and died in the opioid crisis. “The connection between those two things … to know the volume of dirty money — of blood money — that was flowing through our housing market, it’s infuriating. It’s regular people in our province who have paid the price.”
“Regular people lost,” he added. “You have thousands of people priced out of their own community that they’ve lived in, that their families have lived in for decades, that they’ve contributed to, that they’ve paid taxes to … It is so wrong, what has happened.”
West says a strong message needs to be sent, adding there should consequences for anyone who knowingly profited when the values of many homes across Metro Vancouver skyrocketed.
“You don’t launder $5 billion of dirty money through the housing market without the help and assistance of some lawyers and realtors … There are people who knew what they were doing was wrong but participated anyways.”
West says he’s more confident than ever a public inquiry which he’s demanding for months is necessary and will happen. “If there’s not a public inquiry called, with the appropriate powers to get to the bottom of this, to hold people criminally accountable … then I have very little to no confidence that this is going to stop.”
West wants the scope of such an inquiry to make it possible for criminal charges to be laid.
“The people who, for years, denied that there was anything wrong should be hanging their head in shame,” he said. “We certainly heard them in the past years, where they tried to rationalize and explain away what was going on when everyone knew what was going on was wrong and there was something weird that was taking place. I say to those people they should be giving themselves one long look in the mirror … They were providing political cover for a situation that … has had devastating consequences in communities right across this province.”
BCREA admits there are likely a few ‘bad apples’
For his part, Trevor Hargreaves with the BC Real Estate Association says most realtors have no interest in doing business with criminals.
“When it comes to career criminals, they don’t show up … carrying bags of money. They hire people and they work in manners to look elusive. They don’t point out that they’re criminals. It’s all meant for them to be trying to work through loopholes and manipulate markets, where they can,” he said.
He argues cash within real estate is not something the average realtor sees.
“The only time that’s ever used — in extremely rare circumstances — is maybe a $5,000 deposit. It’s not the kind of thing where someone’s purchasing a house by showing up with $2 million in cash and an agent is accepting it in some complicit manner.”
Hargreaves says realtors are just as concerned as the issue as anyone else in the province, although he agrees there are likely “bad apples,” as can be the case in any sector.
“I think you can fairly state the fact that the sector was more complicit than it should be,” he admitted. But he feels this is an “emerging issue” the government has been getting a handle on.
“Realtors are part of their community. They’re very concerned with their own reputation. They get their business through referrals,” he said.
According to Hargreaves, “The public gets confused around how money laundering is operating from one sector to the next. When you’re talking about people showing up with bags of cash at casinos, that’s a world of difference than the way that it works out when people are purchasing real estate.”
Hargreaves calls the $5 billion that the report claims was laundered in real estate “alarming statistics.” He says stronger regulations are now in effect to ensure sales are legal.