By ThinkPol Staff

The world’s leading corruption watchdog is urging Canada to create a publicly accessible beneficial ownership registry to fight money laundering and terrorist financing.

Transparency International Canada Senior Advisor Denis Meunier made the call during his testimony to the House of Commons Standing Committee on Finance, which is currently reviewing the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA )^[1]http://www.transparencycanada.ca/wp-content/uploads/2018/03/Notes-for-Remarks-March-27-2018-final-English.pdf.

“In Canada, more rigorous identity checks are done for individuals getting library cards than for those setting up companies.” Meunier said. “We need a pro-active corporate registry functions harmonized and integrated across Canada with powers to audit, compel information, apply sanctions, detect and report suspicious activities.”

While welcoming the measures introduced last December by Canada’s federal and provincial finance ministers ensure appropriate authorities know who owns which corporations in Canada, Meunier wants the finance ministers to go further and make the registry publicly accessible and look to also create a registry of trusts.

“A public registry will allow all reporting entities, the public and the media to work together to prevent and dissuade the abuse of corporations and trusts by secretive beneficial owners,” Meunier said. “This will lighten the burden on reporting entities and anyone doing business with corporations, to more accurately assess their business risks.”

Lack of transparency in real estate ownership is a serious issue in Metro Vancouver, with analysis of land title records by TI Canada finding that nearly half of the 100 most valuable residential properties in Greater Vancouver are held through structures that hide their beneficial owners^[2]http://www.transparencycanada.ca/wp-content/uploads/2017/05/TIC-BeneficialOwnershipReport-Interactive.pdf.

The BC NDP government’s budget tabled last month includes provisions to bring transparency to property ownership in the province^[3]http://bcbudget.gov.bc.ca/2018/homesbc/2018_Homes_For_BC.pdf.

“Currently in B.C., true ownership of real estate can be hidden,” the budget document Homes for BC reads. “This means numbered companies, offshore and domestic trusts, and stand-in owners obscure the source of funds in the real estate market. For example, lack of transparency in the land registry means it is not clear who owns nearly half of Vancouver’s most expensive properties. This is wrong.”

“The Province is taking action to close these loopholes and give us a clearer picture of real estate ownership in B.C,” the budget document, unveiled by Finance Minister Carole James, stated. “It will also help us to crack down on speculators, tax frauds and those engaged in money laundering.”

“A publicly accessible registry is an investment in prevention,” Meunier said. “It’ll also ensure Canada keeps up with international best practices such as those adopted by the UK and our new EU free-trade partners.”

[Photo Credit: James Jordan]