B.C. Attorney General David Eby and former RCMP investigator Peter German deliver portions of report on money laundering at the B.C. legislature. (Black Press Media)

Hot cars hide dirty money, B.C. organized crime investigation shows

Buying and selling super-cars an international money laundering tactic

B.C.’s luxury car market is being used to launder the proceeds of crime, former RCMP officer Peter German says in his report to the B.C. government on money laundering.

High-end vehicles bought with cash or bank drafts are being bought and sold by “straw buyers” or nominees and exported offshore, German’s report says. The “grey market” activity shows up in B.C. sales tax records, where tax is paid and then large numbers of tax rebates are applied for and paid.

“This report is disturbing confirmation that money laundering in B.C. is a problem that goes beyond our casinos,” said B.C. Attorney General David Eby, who released parts of the investigation dealing with vehicles and horse racing Tuesday.

“In the luxury car market, there is no financial reporting of large cash purchases, no oversight of international bank wire transfers and no apparent investigation or enforcement. It’s all a recipe for exactly what happened here – Vancouver becoming North America’s luxury car capital, generally, and perhaps North America’s used luxury car export capital too.”

The cash purchase or sale of vehicles is legal, but if the source of the money can be traced to criminal activity it is a serious offence, German said.

Regulations are being changed in B.C. to remove the onus on prosecutors to prove that the source of money is criminal, requiring only that they demonstrate the use of money was “reckless,” Eby said.

READ MORE: RCMP has ‘no’ money laundering investigators in B.C.

READ MORE: Money laundering in B.C. casinos a ‘system failure’

The sales tax records show “straw buyers” buying multiple cars and selling them through the same exporters. “It was a surprise to us” to hear that grocery bags of cash were being brought into dealerships, German said.

Former Vancouver Police deputy chief Doug LePard helped in the investigation. He described car dealership staff accepting cash from buyers, and then helping them arrange for tax rebates.

Finance ministry staff report that they have seen a “dramatic increase” in rebate applications for vehicles destined for sale abroad. Before 2014, fewer than 100 vehicles received the rebate, and by 2016 the number of rebates had jumped to 3,674 vehicles.

In 2016 alone, a single “straw buyer” bought 29 vehicles, 48 buyers made between 11 and 29 purchases and 1,000 of these buyers were linked to the same exporter. Since 2013, the province has paid $85 million in rebates for exported vehicles.

Eby said buying and selling race horses has a long history of acting as a vehicle for converting and transporting cash. Activity at Hastings Racecourse in Vancouver and Fraser Downs harness racing track in Surrey did not turn up evidence of suspicious transactions, he said.


@tomfletcherbc
tfletcher@blackpress.ca

Like us on Facebook and follow us on Twitter.

Just Posted

B.C. salmon farm inspection deal reached with Indigenous people

Monitoring to determine if any Broughton region farms stay open

Compromise found on grocery store size in south Campbell River subdivision

Approved increase less than developer wanted, but will still allow for some flexibility

City of Campbell River looks to improve environmental protection during development

Changes to mapping environmentally sensitive areas and how permitting process works is under review

Dippity doo-dah; Campbell River Rotary Duck Dip winners scooped up

Fundraiser for Head Injury Support Society’s Linda’s Place

VIDEO: B.C. man accused of assaulting sex worker loses temper in interrogation

Defence lawyer says statements made by accused Curtis Sagmoen should be deemed inadmissible

B.C. man guilty of first-degree murder in Yukon killing

Edward James Penner, 22, was given the mandatory life sentence for the 2017 slaying of 25-year-old Adam Cormack

Woman stabbed at least five times in Nelson during random attack

Victim is in hospital, suspect is in police custody

Victoria man spots online photo of his totem pole 11 years after it was stolen

Mark Trueman restored the pole himself before it was stolen off of his property in Duncan

‘I’d do it again,’ says B.C. man who swam naked, drunk in Toronto shark tank

David Weaver, of Nelson, was drunk when he went to Ripley’s Aquarium in Toronto on Oct. 12 2018

How to react to Trudeau’s racist photos? With humility, B.C. prof says

‘We are now treating racism as a crime that you cannot recover from’

Horvat paces Canucks to 6-1 pre-season win over Oilers

Vancouver improves to 3-1 in NHL exhibition action

‘Really disturbing:’ Trudeau’s racist photos worry B.C. First Nation chief

Wet’suwet’en Chief concerned the photos will sow fear in Indigenous communities

‘Unacceptable’: What politicians have to say about Trudeau in blackface

Calgary Mayor Naheed Nenshi: ‘When I saw that picture last night, certainly it was a sucker-punch’

Most Read