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B.C. money laundering report recommends provincial investigation unit, commissioner

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A lengthy report highlighting money laundering in B.C. is recommending the province create its own money-laundering intelligence and investigation unit.

Former B.C. Supreme Court justice Austin Cullen was commissioned to do the report in 2019. He says in his report, Lower Mainland casinos “accepted hundreds of millions of dollars in cash that was the proceeds of crime” between 2008 and 2018.

Money laundering led to over $5 billion being laundered through real estate in 2018, causing a five per cent increase in the cost of buying a home, according to the province of B.C.

Cullen’s over 1,800-page report recommends new changes like appointing an independent office in the province and appointing an anti-money laundering commissioner.

The report outlines the duties of the commissioner, including conducting research on money laundering issues in order to develop expertise on the problem.

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The recommendations for the new independent office and commissioner come after Cullen found the Financial Transactions and Reports Analysis Centre (FINTRAC) was ineffective “in producing timely, actionable intelligence for use by investigators.”

Cullen’s report says part of the problem is a “high-volume, low-quality information” trend. Examples of this include when FINTRAC received over 31 million individual reports in 2019-20. However, only 2,057 disclosures were made to law enforcement.

Only 335 disclosures were made to law enforcement in the 2019-20 fiscal year, according to the report.

Cullen also cites a lack of attention to the problem by the RCMP since at least 2012. However, he adds before 2012, the RCMP’s Integrated Proceeds of Crime (IPOC) units were able to develop high levels of expertise.

In 2012, the federal government brought in budget cuts that meant IPOC units were disbanded, leaving police departments without the capacity to investigate money laundering, according to the report.

In response, Cullen recommends the thresholds for needing proof for source funds for casino transactions be lowered to $3,000 and that the attention to money laundering be refocused by police.

Despite the issues, Cullen says there was no evidence of corruption by elected officials. He added the province has made great steps toward understanding money laundering risks, but more still needs to be done.

In a statement Wednesday, attorney general David Eby said he thanks Cullen for his investigation and looks forward to the changes ahead.

“I am appreciative of Canada’s participation in this inquiry. This report is important for the federal government too. It contains significant and challenging findings and calls to action for our federal government,” said Eby. “I hope and expect that the new federal minister with responsibility for this file will join with us in addressing this important shared challenge.”

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