08 February 2018 0 Comments Posted By : Terry Glavin

The battle to clean up B.C.

It was such a lovely picture that the City of Vancouver managed to paint of itself over the 10 years that Gregor “Happy Planet” Roberston was mayor that it’s no wonder so many people believed it. A thriving and happily multicultural Pacific metropolis of bike lanes and balmy weather. Diversity and eco-density and backyard chickens, high-tech startups, and the ski slopes on the mountains just across Burrard Inlet.

Now, with Robertson on his way out, and his Vision Vancouver party a ruined brand, whoever comes out on top in the October civic elections will be left to deal with what’s become of the place. Vancouver is now a kind of free trade zone for gangland money launderers, absentee offshore real-estate speculators, Chinese princelings on the lam and globe-trotting tax frauds. Metro Vancouver is an international housing-affordability basket case and the epicentre of Canada’s fentanyl overdose crisis. Over the past decade, homelessness has doubled, at least 4,000 people are sleeping rough in the streets, and there are now 70 homeless camps across the region.

This wasn’t all Robertson’s fault, of course, not by a long shot. B.C.’s provincial Liberals played their part in it. Defeated last May in a hair’s breadth election that resulted in the New Democratic Party forming an alliance with B.C.’s Greens, Christy Clark’s six-year tenure as the Liberal Party premier ended under a cloud of RCMP investigations into payments from lobbyists and an ethnic-vote harvesting scandal. A trove of incriminating paper trails only now coming to light shows Clark’s Liberals knew very well what was happening.

For now, the job of sorting everything out has fallen mostly to David Eby, B.C.’s 41-year-old Justice Minister and Attorney-General. Two months ago, in a speech at a conference co-hosted by Transparency International Canada and the International Centre for Criminal Law Reform, Eby described Vancouver and British Columbia in the most accurately unflattering terms.

“We knew there was something strange going on, but, my God, we had no idea it was this big,” Eby said. British Columbia had become reduced to “a jurisdiction where the rules do not apply to white collar crime, fraud, tax evasion and money laundering, where even if the rules do apply, enforcement is absent.”

Over the past 10 years, the B.C. Securities Commission had collected less than two per cent of more than a half a billion dollars in fines levied against a rogue’s gallery of fraudsters, swindlers and ripoff artists. Among the beneficiaries of the previous Liberal government’s opaque “Advantage B.C.” head-office tax shelter scheme: PacNet, a collection agency the U.S. Treasury Department had listed as a transnational criminal organization with a sordid track record in money laundering and mail fraud, and China Poly Group, a shady Chinese state-owned enterprise with a payroll of 76,000, intimate ties to the People’s Liberation Army, and a portfolio that ranges from real estate development to arms and explosives and art exhibits. Advantage B.C. is now shuttered.

Among the sleazier aspects of the Liberal legacy was a peculiar toleration for dirty money being laundering through B.C.’s licensed casinos. Provincial officials were aware of the nastiness as far back as 2009. In January of that year, the Integrated Illegal Gaming Enforcement Team (IIGET) conducted a threat assessment focusing on organized crime in licensed casinos and asked the Crown-owned B.C. Lottery Corporation for expanded powers to tackle the problem. Six months later, the IIGET unit was disbanded because of “funding pressure.”

Last September, Eby appointed former RCMP deputy commissioner Peter German, an authority on money laundering, to come up with a series of recommendations on how to cut the flood of dirty money into B.C.’s casinos, Metro Vancouver’s overheated real estate market and “other areas of B.C.’s economy.” German’s report is due next month.

In the meantime, Eby has instituted a simple rule change aimed at preventing drug money from being loaned out by underground “banks” to visiting high-stakes gamblers. The change was recommended to the Liberal government in 2016 in a report by MNP LLP, a national accounting, tax and consulting firm. The Liberal government kept the report secret. Among its findings: over the course of a single month—July 2015—Richmond’s River Rock Casino accepted $13.5 million in $20 bills from mostly “high roller Asian VIP clients,” in transactions that sometimes exceeded $500,000.

The MNP LLP rule change that the Liberals ignored, but which Eby has put in place: You will no longer be able to drive your Lamborghini from your $10 million Point Grey mansion across the Oak Street Bridge to Richmond, stroll into the government-licensed River RockCasino and buy your chips with a half a million dollars in $20 bills stuffed into a duffel bag, then cash out on the same day.

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