September 28, 2018

B.C. launches new money laundering review in real estate sector

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B.C. has ordered a new review of the real estate, luxury automobile and horse racing sectors over worries they’ve been used by criminals to launder illegal money.

Attorney General David Eby said Thursday he’s authorized an independent probe into money laundering that builds upon a similar investigation done earlier this year into how duffel bags full of dirty cash were allowed to flow improperly through B.C.’s casinos.

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The new review will focus on sectors of the economy where criminals could use funds to purchase luxury items, like homes and high-end automobiles. In particular, Eby flagged the use of trust accounts by lawyers to mask the source of money used in real-estate transactions and the misuse of builders’ liens in the construction sector.

“We don’t know yet the extent of criminal activity that may be occurring in these sectors, but we have no intent of ignoring the many warning signs,” said Eby. A final report is expected by March 2019.

B.C. Attorney General David Eby .Representatives from the automotive, legal and real estate industries expressed support Thursday, but also some skepticism their sectors are as susceptible to dirty money as Eby may suspect.

“Quite frankly we’re all giving our heads a shake wondering what’s behind all this,” said Blair Qualey, president of the New Car Dealers Association of B.C. “All of our members, whether they are selling Fords or Maseratis are all under the scrutiny of pretty big global vehicle manufacturers who have some pretty darn high standards (and) who expect dealers to conduct themselves and follow all the rules.”

The Law Society of B.C., which regulates lawyers, said it began adopting a no-cash rule for depositing funds into lawyer’s trust accounts as far back as 2004.

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