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上传时间: 2019-02-10      浏览次数:267次
Another media barrage about money laundering in B.C. but again, no mention of Business Corporations Act


https://www.straight.com/news/1199241/another-media-barrage-about-money-laundering-bc-again-no-mention-business-corporations

 

When I used to teach journalism to college students, I would talk about the importance of reading legislation and regulations.

 

It's not the most exciting thing to do. But if you're going to highlight wrongdoing, you better be familiar with the rules.

 

Yet in the blizzard of Canadian media coverage about money laundering in B.C., there's been little exploration of the legislative framework that enables this crime to flourish.

 

Here in B.C., for example, the Business Corporations Act makes it easy to hide the beneficial ownership of companies.

 

Section 49 of the act renders it impossible for the public or the media to visit a company's records office to obtain a list of shareholders.

 

That wasn't the case in the 1990s.

 

But this changed when Gordon Campbell's first B.C. Liberal government overhauled the old Company Act in 2002 to encourage more investment and more secrecy.

 

Former premier Gordon Campbell's government laid the foundation for corporate secrecy to thrive in B.C.

 

Over the past year and a half, NDP finance minister Carole James and NDP attorney general David Eby have not amended the Business Corporations Act to spread more sunshine.

 

Instead, they've commissioned one report by a panel of three experts to look at money laundering and real estate. Another report is being prepared by former RCMP deputy commissioner Peter German.

 

In 2016, Transparency International Canada pointed out in a comprehensive report that there's nowhere near as much corporate secrecy in Alberta and Quebec as there is in B.C.

 

That same report revealed that there are 385,410 registered corporations in B.C.

 

Think about that for a moment—385,410 legal entities for which it's possible to shield the identity of the owners.

 

Transparency International Canada also concluded that there are millions of trusts across the country.

 

"There is an even greater degree of anonymity for beneficial owners of trusts than for beneficial owners of companies," it stated. "A trust's existence does not need to be acknowledged by a government authority, and trust documents are entirely private."

 

The report went on to say: "The private nature of trust instruments, the fiduciary obligation of trustees to maintain confidentiality, and the absence of any record-keeping requirements combine to make trusts highly vulnerable to money laundering, according to a recent risk assessment by the Canadian government."

 

Last September, the B.C. government finally began collecting information on beneficial ownership of properties. But it's done nothing to address section 49 of the Business Corporations Act.

 

Transparency International Canada's report included this graphic about Vancouver real estate.

 

A couple of days ago, the Globe and Mail published a commentary by a Macdonald-Laurier Institute contributor and Queen's University law professor, Arthur Cockfield.

 

It was entitled "The high price of Chinese money laundering in Canada".

 

Unfortunately, this law professor failed to mention the shortcomings in B.C.'s Business Corporations Act or the role that foreign or domestic trusts might be playing in facilitating money laundering.

 

In a similar vein, CTV's W5 program aired a lengthy documentary last night on money laundering in B.C.'s casinos. The focus was on Chinese gamblers.

 

In the W5 report on money laundering, journalist Kevin Newman didn't ask Attorney General David Eby about B.C.'s Business Corporations Act.

Again, there was no mention of B.C.'s Business Corporations Act or the role of trusts in funds being washed through real estate.

 

It's easy for the media to point fingers at people from China, especially when the RCMP is selectively leaking information anonymously to drive home that narrative.

 

These disclosures are helping the Mounties obtain funding to hire more officers to address the issue.

 

But the preponderance of coverage about China could lead the public to overlook the role of others—ranging from Iran's Revolutionary Guards to outlaw motorcycle gangs to cryptocurrency hustlers to upper middle-class lawyers and doctors—in engaging in widespread speculation and the movement of money into the housing market.

 

Amending B.C.'s Business Corporations Act would be a good step toward shining more light on this aspect of the story.