WHITE COLLAR CRIME – Money laundering
IN BRITISH COLUMBIA The most common channel for money laundering at the higher level was through private businesses like restaurants and construction, while others cleaned money through real estate, gambling and other means.
MONEY LAUNDERING’S THREE STAGES:
Experts on money laundering say the process generally has three stages, but transactions can occur in as many ways as the imagination can devise.
PLACEMENT is the initial entry of dirty cash into the financial system and can take place through exchanging cash for gambling ships in casinos, smuggling currency across borders, repaying loans or wiring funds through foreign currency exchanges.
LAYERING is the second stage, in which money launderers often move money electronically to foreign countries and make multiple financial transactions to confuse auditors.
Finally, dirty cash is INTEGRATED into the mainstream economy in assets such as real estate, high-end vehicles and art work, to be enjoyed, held as stores of wealth, or resold.
CRIMINALS MAY USE MULTIPLE PROFESSIONALS TO FURTHER COMPLICATE THE MONEY LAUNDERING PROCESS IN AN EFFORT TO AVOID DETECTION. THE USE OF A PROFESSIONAL ALSO PROVIDES A VENEER OF LEGITIMACY TO CRIMINAL ACTIVITY AND A BUFFER BETWEEN CRIMINALS AND THEIR FINANCIAL ACTIVITIES AND ASSETS.
AS AN ESTABLISHED MONEY LAUNDERING METHOD, CRIMINALS ARE LIKELY TO CONTINUE TO USE REAL ESTATE TO LAUNDER ILLICIT FUNDS. MONEY LAUNDERING THROUGH REAL ESTATE MAY BE IDENTIFIED WHERE TRANSACTIONS INTERSECT WITH THE REGULATED SECTION. THIS PROVIDES THE REGULATORY BOARD WITH A DEGREE OF VISIBILITY OVER POSSIBLE MONEY LAUNDERING THROUGH REAL ESTATE.
THE B.C. REAL ESTATE TRACKING SYSTEM KNOW AS FINTRAC IS A JOKE AMONG THE REAL ESTATE COMMUNITY.
IT IS A REALTOR’S DUTY TO HAVE THEIR CLIENT FILL OUT THE FINTRAC FORM which requires their name, address, driver’s license number, social insurance number, and the address of the property they are buying. Then the FORM is put into the client’s file with the written real estate contract. It is for information purposes only and is not sent to the regulatory body that is supposed to be monitoring transactions. That is one hell of a legitimate tracking system wouldn’t you say and it has been like that for years with no change in site. Police and prosecutors in this province lack the resources and expertise to counter all this. Also cited is a dysfunctional history between the provincial gaming branch and B.C. Lottery Corp. investigators. FinTRAC, the federal agency that monitors financial transactions, doesn’t have an enforcement arm. Legislation is outdated. This leaves a wide open door for criminals, realtors, lawyers, appraisers, to take advantage of the weak system we currently have in place.
GARY YUZIK, ROBERT STANLEY and his wife CINDY STANLEY were arrested after a high seas raid on an unregistered sailboat which netted a record-breaking cocaine seizure. The ocean makes a super highway which can be a smuggler’s ticket to big money. Unfortunately, they got caught. Gary Yuzik was the former owner of RE/MAX Keremeous Realty, Cindy Stanley worked for Yuzik and her husband Robert was a former top municipal employee. New they are languishing in a South Pacific prison. Whether they will ever return home is questionable.
RONNY KRAYEM, 29 and VINCENZO LANCI 28, were arrested in 2009 on extortion and unlawful confinement charges. Ronny Krayem was a realtor with HomeLife Realty in Langley. He only had his real estate license for a few days when arrested. It turns out these two were involved in transporting drugs back East for organized crime, and the unlawful confinement was ordered by the criminal organization these two worked for. The police would not disclose which gang or criminal organization that was.
MICHAEL GORDON, 33 was a realtor and owner broker of Best Bet Realty in Chilliwack with alleged gang ties and was known to the police. In 2008 he was shot dead in his car outside a convenience store. It was a targeting killing. Gordon was buying and selling property for the UN Gangs jailed leader Clayton Roueche, at the same time spending time with one of Roueche’s enemies. Play with the bull and you get the horn. Or the bullet!!
ELLIOTT CASTANEDA, 29 UN gang member was a realtor with Homelife Glenayre Realty in Abbotsford until a few months before his death. He was gunned down at a taco stand in Guadalajara Mexico on July 12/2008 with fellow UN member Ahmet Kaawach. It is unknown whether Elliott was able to finish his tacos before taking the bullet.
SARAH TREBBLE, a realtor with Sussex Prudential Realty was acquitted in 2009 of a charge of occupying a vehicle in which there was a firearm. Sarah is a know associate of high-ranking UN gang member Barzan Tilli-Cholli. Sarah’s boyfriend Soroush Ansari worked at the same real estate office in West Vancouver. Sarah also lived with her previous boyfriend Larry Amero. Larry was a full patch member of the White Rock Chapter of the Hells Angels. Sarah was a very busy lady and obviously liked the risky life-style.
KRISTA BOSELEY, a realtor with Re/Max Colonial in White Rock and her partner Gilles Lapointe, were arrested and charged with drug smuggling in 2014. They were caught carrying large amounts of cash & drugs at an airport in California. Krista was listed as a model with ModelMahem.com, but the truth was she was no model. Her and her mother ran a massage parlor in Surrey prior to her becoming a realtor. The charges against Krista were later dropped, and her partner Gilles Lapointe took the fall. Her get rich quick scheme fell by the wayside and her future prospects are now very slim.
KEVIN SMETANIUK, was a licensed realtor with Royal LePage Coronation Realty in Surrey. His license was suspended for five years in 2007. BC Court records show Keven was charged in 2007/2008 with possession of property obtained by crime, forging credit cards, fraud and breaking and entering.
OMIR MASHINCHI, 35, was a realtor with the Royalty Group from 2009 until 2016 when he voluntarily gave up his license. Mashinchi had been leasing luxury properties to B.C. gangsters is behind bars in the U.S. charged with international money laundering. He was a realtor with the Royalty Group from 2009 until 2016 when he voluntarily gave up his license. He appeared in a Boston courtroom last month and was ordered held pending trial. Mashinchi has started at least 3 companies in B.C. since 2006, all related to the real estate industry. He has been associating with BC gangsters, including leasing them condos that were used as stash houses and as residences. Many of these properties have been tied to gang-related criminal activity such as drug dealing, murders and drive-by shootings.
SGT. SHINDER KIRK, spokesman for the Integrated Gang Task Force said this, “It’s not surprising that organized crime would turn to real estate. There would be a benefit to having someone in that profession as part of your organization.” Gangs used a number of professions to launder money including real estate. One method criminal use to launder money is this:
They buy a home with cash from an eager realtor or mortgage broker friendly to them or owned by them as a front. They then take out an equity loan on the house in order to maximize the debt on the home, then put someone in it to start a grow-op or meth lab. In the event that there is a bust the proceeds of crime which the government seizes the home is owned by a bank, hence the criminal suffers very little loss since the equity loan is long gone and so is the criminal.
Jack Knox: Country asleep at switch on money laundering | Times Colonist
Legitimate Transactions used for Money Laundering
Some of the most common transactions and assets used to launder the proceeds of crime in Canada include cash deposits (in bank accounts, trust accounts, casino patron accounts, investment brokerage accounts), wire transfers, monetary instruments (bank drafts and cashier cheques), currency exchange, denomination exchange, securities trading, and the purchase of valuable assets, including real estate, cars, and jewelry.
MANIPULATION OF PROPERTY VALUES
Loans and mortgages can be used as a cover for laundering proceeds of crime, and their repayment can be used to mix illicit funds with legitimate funds. Criminals can collude with third parties such as real estate agents to under or overestimate the value of a property.
USE OF PROFESSIONAL FACILITATORS
Professionals used to Facilitate Money Laundering In general, the professionals that encounter the proceeds of crime can be separated into two broad categories. The first category includes the front-line staff of retail businesses that come into contact with individuals laundering money, such as bank tellers, real estate agents, automobile dealers, currency exchange staff, and jewelry store salespeople, among others. This second group includes those with more specialized skills, expertise, powers, and resources.
Lawyers are particularly well-positioned to facilitate MONEY LAUNDERING They can help set up companies and bank accounts and facilitate real estate transactions. They are particularly valued due to legal trust accounts into which the (cash) proceeds of crime can be deposited. Solicitor-client confidentiality can also be of immense benefit when trying to conceal criminal ownership of dirty money and ill-gotten assets. Legitimate Transactions used for Money Laundering
PURCHASE OF REAL ESTATE TO FACILITATE OTHER CRIMINAL ACTIVITY
Criminals may buy property using illicit funds to conduct criminal activity at the property such as the production of drugs. The revenue generated may then be used to buy additional properties in an effort to disguise the original source of the funds.
RENTAL INCOME TO LEGITIMISE ILLICIT FUNDS
Criminals lease out their properties, providing tenants with illicit funds to cover the rental payments in order to legitimize the illicit funds. Criminals may also buy property in a third party’s name and pay that third party rent using illicit funds. By “renting” their own property via a third party, criminals can disguise illicit funds and ownership.
STRUCTURING CASH DEPOSITS TO BUY REAL ESTATE
Criminals deposit cash below the $10,000 reporting threshold across different banks/branches to avoid triggering threshold transactions.
SUCCESSIVE SALES AT HIGHER VALUES
Criminals may further confuse the audit trail by reselling property in quick succession. The property is sold at a higher value, either to a related third party, acquainted third party, or to companies or trusts controlled by the criminal. This gives an appearance of seemingly legitimate profits while the criminal maintains ultimate control.
UNDER-VALUATION
Under-valuation involves recording the property value on a contract of sale which is less than the actual purchase price. The difference between the contract price of the property and its true worth is paid secretly by the purchaser to the vendor using illicit funds.
OVER-VALUATION
Criminals may over value real estate with the aim of obtaining the largest possible loan from a lender. The larger the loan, the greater the amount of illicit funds that can be laundered to service the debt.
RENOVATIONS AND IMPROVEMENTS TO PROPERTY
Criminals use illicit funds to pay for renovations thereby increasing the value of the property. The property is then sold at a higher price.
use of front companies, shell companies, trust and company structures
Front companies, shell companies and company structures can be used to launder money through real estate. Property held in the name of one of these companies allows criminals to distance themselves from ownership.
Jack Knox: Country asleep at switch on money laundering | Times Colonist
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