200,000-Dollar Fine Aims to Expose Money Laundering in Canada |
Canada is such an attractive place for money laundering that there's even a special name to describe the activity here: "snow washing." |
 | | A new law will allow Canadians to figure out who owns companies.Ian Austen/The New York Times |
|
The nature of money laundering, of course, makes measuring it precisely impossible. But a 2019 report on the use of real estate in British Columbia for money laundering estimated that more than 40 billion Canadian dollars a year are laundered nationally, much of it through shell corporations. |
The criminals who run the shells aren't the small-time crooks who another inquiry in British Columbia found clean their cash at casinos by handing it over — as loans to gamblers — in garbage bags and hockey bags stuffed with 20-dollar bank notes. |
Instead, the shell operators run money through an interlocking series of corporations whose interconnections and ownership are opaque, making it virtually impossible for investigators to trace illicit funds and arrest their beneficiaries. |
But under a newly proposed legislative overhaul, it could become more difficult for snow washers to exploit Canadian law, which is now among the weakest in the world at requiring corporate ownership transparency. |
This week, François-Philippe Champagne, the minister of innovation, science and industry, proposed a law that legal experts say would bring Canada in line with international standards. The idea is straightforward. Corporations will regularly be required to report to the government the names of the individuals who ultimately control them. That information will go into a registry that will — with a few exceptions, like the records of companies owned by minors — be open for anyone to view. It will also be cross-checked against tax records and sent to government agencies that track money laundering. |
"It's a positive development if properly implemented," Malcolm Aboud, a lawyer at the Osler law firm who specializes in corruption cases, told me after the legislation was presented to the House of Commons. |
As with so much in Canada, a key factor in making the proposed law work will be getting provincial and territorial support. Companies can incorporate with provincial or territorial governments in addition to the federal government. Without provincial data, the proposed federal registry may be undermined. |
While some provinces — including Manitoba and Prince Edward Island — have or are moving toward ownership disclosure systems of their own, those systems are sometimes much less stringent than the new federal requirement would be, and their data is sometimes not public. While Quebec is implementing a system, similar to the federal plan, that will be open to the public, Ontario's system doesn't even have a registry for the public to consult. It merely requires companies to keep a record of their ultimate owners that can be requested by the government. |
When I asked Laurie Bouchard, a spokeswoman for Mr. Champagne, if any provinces had agreed to cooperate, she replied, "We have good signals, but since it is not in place yet, we can't confirm anything." |
If passed, the new law would allow for fines of up to 200,000 Canadian dollars and jail sentences of up to six months for those who ignore it. But exactly how the government will figure out that criminals aren't adding this to the lists of laws they break is not entirely clear at this stage. |
While Mr. Aboud said that the vast majority of companies would follow the new rules, "the regime will ultimately only be as good as its enforcement." |
Biden's Visit to Canada Culminates in New Migration Rules |
 | | President Biden traveled to Ottawa, where he met with Prime Minister Justin Trudeau and addressed Parliament on Friday.Kenny Holston/The New York Times |
|
Mr. Biden's announcement was one of several made during his first official visit to Canada since taking the Oval Office, a visit that reflected the mending of the United States' relationship with its neighbor after it had become badly frayed during the presidency of Donald J. Trump. |
In exchange for the change to the agreement, Canada will offer legal entry to 15,000 migrants from Central and South America who are fleeing persecution and poverty, a move designed to reduce mounting pressure on the United States' southern border. |
Above all, it was a meeting where the two leaders took pains to emphasize the ties between the two nations. |
 | | Laeticia Amihere can play and defend at all five positions on the court.Nell Redmond/Associated Press |
|
This week's Trans Canada section was compiled by Vjosa Isai, a reporter-researcher in Toronto. |
- "I've never coached anybody that comes with that much determination," said Dawn Staley, a basketball coach for the South Carolina women's team. "Put her anywhere." She was speaking about Laeticia Amihere, the Mississauga-born basketball phenom.
- Leaked intelligence reports related to allegations of Chinese election meddling have put Prime Minister Justin Trudeau on the defensive.
- Canada welcomed a record of more than one million newcomers last year.
- Andy Byford, the former chief executive of the Toronto Transit Commission — whom New York City Transit riders nicknamed "Train Daddy" after he became city's subway chief — will join Amtrak.
- Fanatics, a sporting apparel company, will replace Adidas as the supplier of N.H.L. uniforms. The company, which sells made-in-Canada jerseys and fan apparel, reached a new 10-year agreement with the league.
- An American federal court tossed a lawsuit brought by a Canadian company named Free Holdings, which disputed the ownership rights of an NFT artwork called "Quantum."
- A request to start a commercial seabed mining project in international waters, made by a publicly traded Canadian start-up called the Metals Company, is at the center of tensions at a United Nations-affiliated agency.
|
A native of Windsor, Ontario, Ian Austen was educated in Toronto, lives in Ottawa and has reported about Canada for The New York Times for the past 16 years. Follow him on Twitter at @ianrausten. |
How are we doing?
We're eager to have your thoughts about this newsletter and events in Canada in general. Please send them to nytcanada@nytimes.com. |
Like this email?
Forward it to your friends, and let them know they can sign up here. |
|
No comments:
Post a Comment