An expert panel looking into money laundering in B.C.’s real estate market has found an estimated $5 billion in “dirty money” was laundered through the province’s housing market in 2018.

The panel found that illegal activity contributed to increasing the cost of buying a home in the province by five per cent.

“Our housing market should be used for housing people, not for laundering the proceeds of crime,” Finance Minister Carole James said.

“The amount of money being laundered in B.C. and through real estate is much more than anyone predicted.”

Including luxury cars and horse racing, the panel estimated $7.4 billion in money was laundered through B.C. in 2018. The panel estimates $47 billion was laundered in Canada last year.

The panel, chaired by Maureen Maloney, has put forward 29 recommendations.

The B.C. government has already implemented a number of the recommendations, including implementing the Land Owner Transparency registry.

The report also recommends real estate developers be licensed under a regulatory regime and that the province establish an intelligence unit to collect data on transactions.

The full Peter German report was also released on Thursday.

German found thousands of specific properties worth billions as “high risk” for money laundering or tax evasion. There are also concerns that there is no agency or police force with adequate oversight or resources to investigate suspicious activities.

“Wealthy criminals and those attempting to evade taxes have had the run of our province for too long, to the point that they are now distorting our economy, hurting families looking for housing and impacting those who have lost loved ones due to opioid overdose,” Attorney General David Eby said.

German says that B.C. has some of the strongest rules in place for lawyers yet there is no external reporting and no visibility with respect to what is in a lawyer’s trust account.

“B.C. lawyers can represent one party to a sale and be under no obligation to report suspicious transactions,” German writes.

“It is most important that it be possible to trace dirty money as it transits across the oceans, into and out of bank and trust accounts. Without this ability, law enforcement is left with a partial money trail, which many will argue is of little use.”

More to come…

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