BCREA & The Commission of Inquiry Into Money Laundering
Trevor Hargreaves
BCREA
This morning, the British Columbia Real Estate Association (BCREA) makes our opening statement to the Cullen Commission of Inquiry into Money Laundering in British Columbia. As this process gets underway you should expect to see increased amounts of media coverage in coming days.
To this end I wanted to provide you with an update of the steps we are taking here at BCREA.
We will be engaging with press over the next few days on the subject. As part of this process we are balancing partaking in this inquiry, with taking the opportunity to question common assumptions around money laundering and real estate. We query the model used to indicate size and scale of the issue, and make a public call for increased governmental collaboration at the provincial and federal level. We will also be re-asserting our desire for government to review the five recommendations we issued this past April. I’ve listed these below for your reference:
- Accept only verified funds – For sectors of real estate that are not already required to do so, we recommend that they accept funds only in forms that are verifiable through Canadian financial institutions.
- Mandatory anti-money laundering education – We recommend the introduction of mandatory anti-money laundering education for all real estate professionals subject to the reporting requirements administered by the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) to ensure that those professionals are trained in recognizing and reporting suspicious transactions. As a first step, we were pleased to see the Real Estate Council of British Columbia introduce mandatory training for real estate professionals in January. FINTRAC 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.
- Smart regulation – We recommend that the federal government amend the Proceeds of Crime (Money Laundering) and Terrorist Financing Act to allow FINTRAC intelligence to be made available to additional regulatory authorities, including the BC Securities Commission and the BC Financial Services Authority. Optimally, the federal and provincial governments, 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.
- Ongoing engagement – We recommend governments and regulatory agencies, including FINTRAC, better utilize on-the-ground experience of 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.
- Timely and transparent reporting – We recommend that FINTRAC implement a framework to identify and report trends on a regular basis and in language that is consistent and understandable to professionals, the public and media. This reporting system should also include consistency in examinations with immediate feedback designed to help industry professionals improve their compliance systems.
Vancouver, BC – April 15, 2019. Organizations representing key professions in the BC real estate sector submitted joint recommendations to the provincial and federal governments today to help protect BC’s housing market from money laundering.
The participating organizations include 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.
In their submission, these organizations also commit to shared best practices to help keep the proceeds of organized crime out of the economy. Their efforts focus on helping protect the real estate market from unscrupulous operators and ensuring the public can have full confidence in BC’s real estate market. All of the organizations have fully supported and participated in the government’s investigations into money laundering and real estate.
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.
Copyright © 2020 British Columbia Real Estate Association
