B.C. Money Laundering Commission to Hear From Experts as It Continues Probe

May 5, 2021 Updated: May 5, 2021

After a round of hearings in April with high-profile politicians, including former B.C. premier Christy Clark, the Cullen Commission will be hearing from expert witnesses in the coming weeks as it continues its investigation of widespread money laundering in B.C.

Questions to current and former politicians appearing before the commission included probes on whether claims of authorities’ reluctance to properly monitor and report suspicious cash transactions were true, and whether the desire to boost provincial revenues played a role in limiting enforcement.

Throughout the hearings, initiated in May 2019, the commission heard from expert witnesses who provided details on the flow of dirty money into the province and the role of money laundering in the flooding of fentanyl in North America by Chinese transnational crime syndicates.

“Decades of bad policy allowed drug cartels, first and foremost the Big Circle Boys—powerful transnational narco-kingpins with ties to corrupt Chinese officials, real estate tycoons, and industrialists—to gain influence over significant portions of Canada’s economy,” reads an introduction to “Willful Blindness,” an upcoming book by investigative journalist Sam Cooper on money laundering and drug operations in B.C.

“Many looked the other way while B.C.’s primary industry, real estate, ballooned with dirty cash. But the unintended social consequences are now clear: a fentanyl overdose crisis raging in major cities throughout North America and life spans falling for the first time in modern Canada, and a runaway housing market that has devastated middle-class income earners.”

The B.C. Coroner’s Service reports that 1,723 people died from illicit drug overdose in the province in 2020 alone. Public Safety Minister Bill Blair has said that China is one of the main manufacturers of fentanyl and plays a key role in the current overdose crisis in Canada.

According to FTI Consulting, one of the largest global management consulting firms in the world, China’s Macau is a major hotbed of money-laundering activity. China’s foreign exchange control regulations place stringent limits on the transfer of cash outside of the country. However, Chinese Communist Party officials and other wealthy individuals can easily get around this by making deposits to one or more of many underground banks located in Macau.

Australian international security professor John Langdale coined the term “Vancouver Model” to describe the sophisticated web of international drug cartels and underground banks that enable the export of drugs and facilitate money laundering out of China. According to Langdale, Vancouver is a hub for Chinese-based organized crime and a complex network of criminal alliances. Money is laundered from Vancouver to and from China, while high rollers from China using Canadian casinos to facilitate the flight of capital from their country.

Criminologist Stephen Schneider cited an example of China-linked money laundering operations during his testimony before the commission last year, about a China-linked currency exchange business in the Vancouver area serving as a “vortex” of casino and real-estate money laundering. It’s alleged that the enterprise was funnelling as much as $1.5 million a day through these underground banks.

The final report of the Cullen Commission is scheduled to be released in December this year. It was originally scheduled to be released on May 15. However, an extension was granted due to the pandemic necessitating the hearings to be shifted online, as well as delays caused by challenges in gathering documents and the broad scope of the issues being investigated.

In his interim report, Commissioner Austin Cullen describes money laundering as “a crime that strikes at the heart of our collective values and corrupts the fabric of a free and democratic society.”