Money Laundering in Canada and Bill C-289
Just before the summer recess of Parliament, I introduced my Private Members Bill to give law enforcement authorities another tool to combat money laundering by organized crime in Canada. The scale of money laundering in Canada is staggering, and impacts Canada by laundering proceeds of illicit activities and driving up real estate prices for all Canadians. Experts estimate that nearly 100 Billion dollars of the proceeds of crime, such as drugs, human trafficking and political corruption, are “Snow washed” in Canada every year. Dirty money is deposited, moved around, and then channeled into legitimate investments like homes and commercial real estate.
Under our currently weak investment rules, banks and other financial agents are required to collect and verify the identity of their clients. But what if clients lie about their identity or the corporate ownership structure of the account holder? Currently, we have very lax laws about money laundering that make it difficult to prove or get a conviction. That is why global criminals view Canada as a prime destination for money laundering activity. This must end.
The legislation (Bill-289) if adopted, would make it a criminal offence for individuals or businesses to provide false information to financial institutions to conceal the illegal sources of the money or the identity of the account holders. Those who have violated the law could face a prison term of up to ten years and/or a fine of up to a million dollars CAD. This Bill will complement the publicly accessible beneficial ownership registry the Liberal Government plans to bring forward by the end of 2022. Without Bill 289, money launders will continue to get a free ride without severe punishment.
No one change will end money laundering, but we must do more to stop the illegal flow of criminal funds to Canada. That’s why I look forward to working with Members of all parties and Senators to pass this and other legislation to address this serious issue facing Canada.
What people are saying about Bill C-289
“We are pleased to see the proposal of this Bill that fits in with increasing attention and efforts in Canada to fight money laundering and end our national reputation for ‘snow washing’. This proposed amendment can be a crucial tool in closing one of the many gaps that have been exploited by kleptocrats, tax cheats and their enablers. TI Canada hopes to see all parties come together to move this proposal forward.” - James Cohen of TI Canada
“It is great to see momentum to shut down loopholes and strengthen anti-money laundering criminal sanctions. We welcome this proposed amendment to the Criminal Code.” - Sasha Caldera from Publish What you Pay Canada
“After decades of turning a blind-eye, the proposed amendment to the Criminal Code is one of many steps Canada needs to show that it is actually serious about containing global financial crime.” -Christian Leuprecht, Professor, Royal Military College & Queen’s University and senior fellow of the Macdonald Laurier Institute
In a recent, CD Howe Intelligence Memo, expert Kevin Comeau acknowledged the challenge with Canada’s current laws regarding anti-money laundering, “Under our present anti-money-laundering rules, financial institutions and designated non-financial businesses and partnerships (Reporting Entities) are legally required to collect and verify the identity information of their clients. Reporting Entities failing to do so are subject to sanctions. But clients who provide false beneficial-ownership information are not…The federal government can reduce these risks by enacting legislation attaching sanctions to false reports of beneficial ownership made to persons who are legally required to collect that information.” Source