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

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

VicPD investigates stabbing near Selkirk Montessori school

Victim in potentially life-threatening condition

New wing opens at Victoria International Airport

The 19,000 sq. ft. passenger lounge can hold up to 500 people

Realtor pitches Langford’s third retail cannabis store

Local business owner Ron Cheeke prepares to open Honeycomb Cannabis

VIDEO: Trudeau asks Canada to look to current, not past, actions on race

Liberal leader says he never spoke about the racist photo because he was embarrassed

Crime Stoppers most wanted for Greater Victoria for the week of September 17

Greater Victoria Crime Stoppers is seeking the public’s help in locating the… Continue reading

POLL: Should the province step in to upgrade the road to Bamfield?

The death of two University of Victoria students on a bus bound… Continue reading

Legislature gifts, clothing, travel need better control, B.C. auditor says

Audit follows suspensions of managers by Speaker Darryl Plecas

‘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’

Island contestant competes on Great Canadian Baking Show

Andrea Nauta auditioned for the show before but was lucky second time around

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

Teens charged in stabbing death of B.C. man in strip mall parking lot

Two youths, aged 15 and 16, charged in Aug. 16 killing of South Surrey’s Paul Prestbakmo

Most Read