Five people are facing a number of charges after an investigation into money laundering that was linked to illegal online cannabis sales, Alberta RCMP announced on Thursday.
Police allege that Moxipay, an Edmonton-based company, facilitated payments for unlicensed, illegal, online cannabis dispensaries.
During the year-long investigation, police learned that Moxipay didn’t register as a money service business with the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) which is an offence under the Proceeds of Crime, Money Laundering, Terrorist Financing Act (PCMLTFA).
Investigators say cannabis dispensaries that were not federally licensed to produce or sell cannabis in Canada used Moxipay to transfer and receive funds.
Between January and December 2018, police said Moxipay facilitated over 84,000 transactions where nearly $15 million was received as proceeds from the illegal sale of online cannabis.
According to a news release, Moxipay would allegedly receive the funds through e-transfers into several bank accounts and those were laundered by either transferring back to the illegal cannabis dispensaries or to “their direct benefit through third-party individuals and entities.”
“Illicit online drug trafficking is borderless and always evolving,” Supt. Chad Coles with Federal Serious and Organized Crime said. “It has forced police agencies to be innovative in their approach when tackling these complex investigations.
“Consumers have a responsibility to know the laws; know that where they are purchasing from is a legal source.”
Four directors of Moxipay — Nando Covelli, 67, John Oluk, 67, Marco Bonnani, 45, and Daniel Tse, 39, — were charged with several Criminal Code offences including laundering proceeds of crime and possession of property obtained by crime, and several PCMLTFA offences including failing to register with FINTRAC and failure to report suspicious activity.
Moxipay employee Lorenzo (John) Covelli, 31, was also charged with several Criminal Code offences including laundering proceeds of crime and trafficking in property obtained by crime.
Dangers of illegal cannabis
RCMP warn there may be health and safety risks associated with illicit cannabis.
Police say the potency maybe unknown and the quality and purity of illicit cannabis cannot be guaranteed and is frequently mixed with other hazards like pesticides, other drugs, heavy metals, moulds or fungi and other contaminants.
“Since the legalization of recreational cannabis came into effect last year, consumers now have access to federally inspected and provincially regulated cannabis products,” Dave Berry, vice president of Regulatory Services with the Alberta Gaming Liquor and Cannabis said.
“Currently, there are more than 370 licensed retailers in Alberta and only one legal source to purchase cannabis online, AlbertaCannabis.org.
“Limiting the illicit market remains a top priority for AGLC.”
Police also warned that using an illegal cannabis site presents the risk of having your banking information compromised.
Criminals can use that stolen information to access bank accounts, open new bank accounts, transfer bank balances, apply for loans and credit cards or get a fraudulent passport, police warned.
Fines for possessing or distributing illegal cannabis can result in a fine up to $5,000 or jail time.