With the new revelations about the so-called “Vancouver Model” of money laundering linking fentanyl, casinos and luxury Vancouver real estate, some are calling for a public inquiry into the matter.
The Vancouver Sun’s Vaughn Palmer says no, there shouldn’t be a public inquiry because they are expensive.
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They cost a whole heck of a lot of money, everyone ends up with a lawyer and at the end of the exercise, the same information could be gleaned from a private inquiry like the one B.C. has commissioned from Peter German – an expert in money laundering and financial crime.
He’s completed his initial report, and on Thursday, B.C. Attorney General David Eby said after the government processes German’s report on casinos, it will task him to complete a second one on real estate.
Palmer says that’s a far more cost-effective way to go than a public inquiry method. But is cost-effectiveness really what we’re after?
One of the institutions that have come up for significant scrutiny and criticism is the government agency tasked with monitoring financial crime, FINTRAC – the Financial Transactions and Analysis Centre of Canada.
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For years and years and years, you and I have been told that FINTRAC is on the case, it is there to make sure money laundering doesn’t occur and suspicious transactions over $10,000 will be checked.
Well, we have been misled on a gigantic scale.
Diane Francis from the Financial Post wrote a piece last July that talked about FINTRAC. She said it can only do half the job: it reports unusual or suspicious transactions to law enforcement agencies, but FINTRAC is not authorized to request additional information from any reporting entity, like a casino.
That limits the scope and depth of the analysis that it’s supposed to be conducting.
So when the casino fires off the paperwork to FINTRAC saying, “Yeah a guy just pulled up here with $500,000 in 20s in a hockey bag, thought we’d let you know, have a nice day,” the casino says, “Hey, we’ve done our job, we’20sve reported to FINTRAC.”
So they give the guy $500,000 in chips, maybe he wins some, maybe he loses some. And when he cashes those chips out, the casino writes him a clean cheque, and that player has effectively laundered half a million dollars.
He can take the cheque to the bank, he can do whatever he likes with it. FINTRAC is supposed to look into that, but FINTRAC cannot request additional information from the casino.
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How does that make any sense to you? Who wrote this thing?
So the police get this report from FINTRAC saying, “Hey, some guy pulled into the casino with half-a-million in cash, you may want to check on that,” but the cops say, “Hang on a second, we’ve got a reported transaction, but no other evidence to go on.”
There’s no way law enforcement is going to dive into that without information or an explanation.
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And that’s one of the problems with FINTRAC. We’re left with the impression that this is meant to be the big investigative law enforcement arm of government, and these are the people that are digging in.
They can’t even ask the big questions. They certainly don’t have any enforcement. They can’t send people around to enforce the law or do deep investigating. They have no power to bring people to justice.
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They rely on the local police and the RCMP for that.
You can’t blame the local police for this. They say, “What the heck is this? We got a report about some guy with a big bag of money at a casino. Where do we go from here?”
One of the things Eby said, when he spoke to a federal finance committee about just how bad things are, is that Canada has had a reputation for many years when it comes to the specific issue of money laundering.
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This country is seen by other countries in the G8 as a laggard when it comes to dealing with laundering.
This is one of the reasons why Vancouver and B.C. have been left as complete sitting ducks to these Chinese Triads who know they can bring fentanyl here, launder money through casinos and shadow banking systems.
They don’t even have to smuggle money back — it’s just all done through the underground banking system.
So I say, bring on the public inquiry – it’s worth the cost, and it’s time to clean up the corruption.