Money-laundering problem in Canada similar to other countries, experts says
‘Much too onerous for restaurants and cafes’
A senior police officer from the United Kingdom who specializes in money laundering says he believes Canada is no more vulnerable to the crime than other Western jurisdictions.
Simon Lord of the National Crime Agency, who is also part of a Five Eyes group dedicated to international money laundering controls, began his testimony before a public inquiry into money laundering in British Columbia on Thursday.
Inquiry commissioner Austin Cullen heard in February from a coalition of tax fairness groups that hiding ill-gotten cash behind shell companies is so widespread in Canada, it’s known globally as “snow washing.”
However, Lord says that the money laundering situation in Canada looks similar to that of the United Kingdom, the United States and other countries with similar legal and economic frameworks.
He says aspects of an economy designed to attract investment or “good money,” like having a developed financial system and global trade links, typically have the effect of attracting “bad money” at the same time.
Generally, he says Canada is “pretty well run.”
“I wouldn’t say Canada is any more or less vulnerable to money laundering, and certainly British Columbia, than any other large Western country,” Lord says.
There are consequences to being perceived as a country that is vulnerable to money laundering. Lord gave the example of the United Arab Emirates, which he says he believes has been unfairly portrayed as a “hot bed” for money laundering.
Vancouver Mayor Kennedy Stewart is calling for a fee cap on delivery apps that have been both a blessing and a curse for many local restaurants during the COVID-19 shutdown.
In a news conference Thursday, Stewart noted how food delivery apps have been a lifeline allowing restaurants to stay in business while closing dining rooms and adjusting to new physical distancing and heightened cleaning protocols.
However, some come with high service costs to the restaurant or collect fees that neither benefit the restaurant nor the delivery person. With pandemic orders to stay home and physically distance, food delivery apps have exploded in popularity and revenue.
“Home delivery and takeout services have been vital for restaurants and cafes earn some revenue and keep their kitchen staff working during COVID-19,” said Stewart.
“Delivery apps played an important role in connecting restaurants and customers — yet this connection comes at a very high cost.”
Stewart noted that some apps charge restaurants up to 30 per cent in addition to a delivery fee paid by the customer.
“These fees are much too onerous for restaurants and cafes and makes it hard for them to earn enough to keep their doors open and staff working,” he said.
The mayor then boosted a call by the B.C. Restaurant Association, urging the companies behind popular food delivery apps to temporarily cap their platform commission at no more than 15 per cent.
Failing action from the companies, Stewart vowed to work with senior levels of government to explore possibilities for regulating the quickly growing industry.
“In many cases, for many establishments, this small change can mean the difference between our favourite restaurants being open or closing forever.”
The B.C. Restaurant and Foodservices Association spoke out during the early weeks of B.C.’s state of emergency declaration, reaching out to delivery app companies and seeking lowered fees for the industry.
In mid-March, Uber Eats announced it would waive delivery fees for customers on thousands of local restaurants in a bid to encourage patronage. It also offered local restaurants flexible payment options, to allow for a more reliable source of cash flow.
DoorDash has also waived delivery fees for many restaurant partners and will launch its campaign Local Restaurant Saturday in June to drive additional orders.