Canadian police not doing enough to track criminal cash: task force
Police in Canada are not doing enough to investigate money laundering by more than 650 organized crime groups trying to hide their illicit cash, an international oversight agency says in a new report.
The Financial Action Task Force (FATF), a body that creates standards to tackle money laundering globally, said “Canada is exposed to a very high money laundering threat of both local and foreign origin.”
While various types of fraud were cited as major sources of laundered money, the report said “the proceeds of drug trafficking laundered in Canada are also significant and derive predominantly from domestic activity controlled by organized crime groups.”
“Organized criminal groups pose the greatest domestic money laundering risk, as they are involved in multiple criminal activities generating large amounts of proceeds of crime,” FATF said.
Money laundering is supposed to be a law enforcement priority in Canada.
“But in practice, most of the attention is focused on securing evidence in relation to the (related, more serious) offence and little attention is given to money laundering,” the report says. “Insufficient efforts are deployed in pursuing the money laundering element of (more serious) offences and pursuing money laundering without a direct link to (that) offence.”
FATF says Canadian law enforcement agencies don’t take a “follow the money” approach to investigating organized crime.
“Nor do they initiate a parallel financial investigation, notably because of resource constraints,” the report says.
Those wanting to launder drug proceeds use “businesses that handle high volumes of cash.”
“These include brick and mortar casinos, convenience stores, gas stations, bars, restaurants, foodrelated wholesalers and retailers and dealers in precious metals and stones.”
And it said that organized crime groups also use some of Canada’s 43,000 no-name ATM machines — known as white-label ATMs — to launder drug money.
These ATMs, located in stores, restaurants, bars and other community locations, are not owned by banks or credit unions and are not subject to regulation under Canadian law, the report says.