Five organizations have come together in an effort to catch and purge money laundering operations in British Columbia’s real estate market.
The province’s housing has long been susceptible to unscrupulous actors looking to wash dirty money, and the British Columbia Real Estate Association, the Appraisal Institute of Canada—BC Association, BC Notaries Association, Canadian Mortgage Brokers Association—British Columbia and the Real Estate Board of Greater Vancouver have provided the provincial and federal governments with joint recommendations on how to curtail such activity.
The consortium also submitted best practices to keep dirty money out of the economy at a time when the public is expressing serious reservations about the province’s real estate market, which has also been connected to the fentanyl trade.
“A real estate transaction involves multiple professionals. It will take a coordinated effort by all involved, working in collaboration with government, to stop money laundering. The joint recommendations and best practices submitted by these organizations reflect their commitment to the professionals and consumers they serve,” read a joint statement released to media.
Among the recommendations is accepting only verified funds, and forcing all sectors of real estate to do the same.
Mandatory anti-money laundering education is recommended because as a way for real estate professionals to identify untoward or suspicious activity and report it.
“FINTRAC [Financial Transactions and Reports Analysis Centre of Canada] should work with sector organizations, regulators and the provincial government to improve existing resources so that they better reflect real world situations and improve compliance,” continued the statement.
The group also calls for “smart regulation,” whereby an amendment is made to the Proceeds of Crime (Money Laundering) and Terrorist Financing Act to allow FINTRAC intelligence to find its way to other governmental bodies, including the BC Securities Commission and the Financial Institutions Commission.
“Optimally, the federal and provincial government, as well as their respective agencies, should coordinate their actions, share information, such as the provincial assignment registry, and create a comprehensive, efficient enforcement regime.”
It is also recommended that government and regulatory agencies, including FINTRAC, regularly engage with real estate professionals “to develop compliance resources and test policy ideas. This will result in well-crafted, practical regulation and foster a culture of compliance to protect consumers and the economy.”