Dirty Money

Uncovering the hidden flows of dirty money into, out of, and throughout Canada.

Financial crime in Canada remains a mystery: omnipresent, but we know little about its operation. Transactions are cloaked with apparent legality, which makes tracking criminal activity through economic or financial statistics a complex undertaking.

This distinctive volume aims to stem in-, out-, and through-flows of vast sums of dirty money by enhancing Canada’s capacity to detect, disrupt, deter, investigate, and prosecute domestic financial criminals and transnational organized criminal organizations. It brings together leading scholars and practitioners from the public and private sectors to identify and explore deficiencies in federal and provincial policy, regulation, legislation, politics, institutions, and enforcement, as well as the international financial crime regime. Together contributors pinpoint weaknesses that have turned the Canadian federation into a destination of choice for global financial crime, where its perpetrators can operate with impunity.

Dirty Money reveals how globalization and technology have spun an extensive web of clandestine processes that disguises how financial criminals operate, the channels they use, and how they suborn banks and institutions. In the process, the extent of financial crime in Canada and its corrosive effects on communities, democratic institutions, and prosperity becomes apparent.

Contributors: Sanaa Ahmed, John Cassara, Garry Clement, Arthur J. Cockfield, Caroline Dugas, Jamie Ferrill, Cameron Field, Michelle Gallant, Peter German, Rhianna Hamilton, Todd Hataley, Caitlyn Jenkins, Christian Leuprecht, David Maimon, Katarzyna (Kasia) Mcnaughton, Denis Meunier, Pierre-Luc Pomerleau, Stephen Schneider, Jeffrey Simser.

Details

Part of the Canada: The State of the Federation Series (number 26 in series)

432 Pages, 6 x 9

Institute of Intergovernmental Relations

ISBN 9780228019053

September 2023

Formats: Cloth, Paperback, eBook

“Dirty Money provides an eye-opening look at the pervasiveness of financial crime. In chapter after chapter, experts lay bare the ways that criminals exploit blind spots in Canada’s financial intelligence regime. Importantly, this book is chock-full of solutions. Legislators must answer this call to action.” Rita Trichur, Business Columnist, The Globe and Mail

“Dirty Money offers valuable insight into a vexing and important topic. The expert perspectives of its contributors shed light on money laundering, financial crime, and the ever-present shadow of corruption - all real concerns for today’s governments and the public at large.” The Hon. Austin Cullen, Commission on Money Laundering in British Columbia

“Dirty Money’s comprehensive and penetrating analysis of the challenges raised by financial crime, though focused on Canada, should be required reading for those from many jurisdictions - in particular, from my perspective, members of the US Treasury’s Financial Crimes Enforcement Network.” Walter Hellerstein, University of Georgia School of Law

“Transnational financial crime, including money laundering and tax evasion, is a threat to Canadian democracy. This book is an eye opener to the vulnerability of our society to this type of crime which effects our economy and quality of life.” Sunita Doobay, Tax Partner at Blaney McMurtry LLP and Lecturer at Queen’s University School of Law

“Featuring contributions from recognized experts, Dirty Money provides a thought-provoking, thoroughly detailed, and often surprising examination of financial crime in Canada, including its current scope and scale, federal and provincial efforts and capabilities to combat this scourge, and steps Canada can take to maintain the upper hand. This is essential reading for legislators, law enforcement, regulators, professionals, and anyone wishing to learn how financial crime thrives in Canada and what we can do about it.” Norman Baldwin, GRC Vista Risk Consulting

Christian Leuprecht is Class of 1965 Professor in Leadership in the Department of Political Science and Economics at the Royal Military College of Canada, Director of the Institute of Intergovernmental Relations in the School of Policy Studies at Queen’s University, and Adjunct Research Professor in the Australian Graduate School of Policing and Security at Charles Sturt University.

Jamie Ferrill is a lecturer in Financial Crime Studies at the Australian Graduate School of Policing and Security, Charles Sturt University.

Acknowledgements xi

1 Introduction 3
Jamie Ferrill, Christian Leuprecht, and Jeffrey Simser

A Enabling Financial Crime: Critical Introductions to Canadian Federalism

2 Washing Money in the Canadian Laundromat 27
Peter M. German
3 What Do Tax Haven Data Leaks Tell Us About Canadian Financial Crime? 43
Arthur Cockfield
4 Taken to the Cleaners: How Canada Can Start to Fix Its Money-Laundering Problem 65
Christian Leuprecht and Jamie Ferrill
5 Running with the Hare, Hunting with the Hounds: The Canadian State and Money Laundering 91
Sanaa Ahmed
B Persistent Failures: Critical Perspectives on Federal and Provincial Intelligence and Enforcement
6 Canada: Combating Money Laundering - Leader or Laggard? 123
Denis Meunier
7 Money Laundering Investigations in Canada 1982 to Present: Why Canada Is Failing 157
Garry Clement
8 The Powers, Operation, and Limits of the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) 177
Katarzyna McNaughton

C Emerging Issues in Financial Crime: Challenges in Multilevel Governance

9 Underground Banking in Canada 219
Caroline Dugas, Pierre-Luc Pomerleau, and David Maimon
10 Trade-Based Money Laundering: Vulnerabilities in British Columbia and Canada 239
John A. Cassara
11 Organized Crime, Trade-Based Money Laundering, and the Canada-United States Trade Stream 273
Todd Hataley and Jamie Ferrill
12 Task Specialization in Organized Crime Groups: Money Laundering and the Montréal Mafia 293
Stephen Schneider

D Containing Financial Crime: Innovations in Multilevel Governance

13 Canadian Cryptocurrency Conundrums: A Socio-Technical Systems Analysis of Crypto Laundering in Canada 325
Caitlyn Jenkins, Rhianna Hamilton, and Christian Leuprecht
14 Private-Public Partnership Opportunities in the Canadian AML and Regulatory Landscape 349
Pamela E. Simpson and Cameron Field
15 Taking Money Laundering Seriously: Some Provincial Pieces of a Global Strategy 369
Michelle Gallant

E Financial Crime in Canadian Federalism: Federal and Provincial Policy Options

16 Responses to Money Laundering and Canadian Intergovernmental Affairs 387
Jeffrey Simser

Contributors 411