Think money laundering is a big-city problem?
“It can be anywhere,” said Trish Ariss, who’s been educating Alberta business people about the breadth and depth of the problem.
“It can affect large centres; it can affect small towns; it can affect anyone.”
Ariss is involved in Merchants Against Money Laundering, an RCMP initiative to raise public awareness about money laundering and how to combat it.
A broadcast journalism student, she’s been working with Kate Spurr, who is a law student.
Both are based in Calgary and involved in the program for the summer.
Ariss and Spurr talked about money laundering to a group of about 30 people at the Red Deer Chamber of Commerce office on Thursday.
“We want people to be aware of it, and to know how to fight money laundering — how to recognize it if something does come up in their business,” said Ariss.
She said the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) has estimated the annual proceeds of criminal activity worldwide at US$500 billion to $1 trillion.
Various methods are used to transform this ill-gotten money into currency that is difficult to trace to its source.
For instance, said Ariss, people will buy gambling chips at a casino and then redeem them. Or they’ll arrange for money to be deposited at various bank branches and later transferred to a central account.
“The money gets layered and harder to trace.”
Other laundering techniques include buying large assets with bulk cash, setting up fraudulent loans or mortgages with an accomplice, advancing money on credit cards or ATM accounts, investing in legitimate businesses and mixing clean and dirty money, buying foreign currency and transferring money electronically.
“Criminals are only limited by technology and their own creativity,” said Ariss.
Not only does money laundering encourage criminal activity to continue, it hurts businesses, she pointed out.
“It’s very harmful for the legitimate economy,” said Ariss, adding that businesses that unknowingly becomes associated with money laundering can suffer a loss of reputation and even have assets seized.
People have a responsibility to report suspicious activity to FINTRAC or the police, she said.
If someone’s actions appear illicit, ignoring them does not protect you from being deemed complicit.
“In the eyes of the law, that’s as good as knowledge,” said Ariss.
Under The Proceeds of Crime (Money Laundering) and Terrorist Financing Act, a variety of people and entities are required to report suspicious financial activities to FINTRAC.
These include financial institutions, life insurance companies, securities dealers, money services businesses, accountants carrying out certain acts on behalf of clients, real estate brokers, casinos, dealers in precious metals and stones, and real estate developers.
“A lot of people aren’t aware either that they’re required by law to report suspicious transactions, or they don’t really know what their requirements are,” said Ariss.