recommendations from the final report on money laundering in B.C. from the Cullen Commission include more stringent regulations on real estate agents, and the imposition of tighter controls on traditional and alternative mortgage providers.DARRYL DYCK/The Canadian Press
British Columbia’s Attorney-General says the provincial government will move forward on implementing an inquiry’s recommendations for better fortifying the province’s real estate market against money laundering, but he did not commit to following through on one of those suggestions: that B.C. set up its own financial intelligence agency.
The inquiry, known as the Cullen Commission, released its final report on money laundering in B.C. on Wednesday. A homegrown intelligence service, the document says, would reduce the province’s reliance on FinTRAC, the federal anti-money-laundering agency.
The commission, led by B.C. Supreme Court Justice Austin Cullen, found that FinTRAC does not adequately respond to reports of suspected financial crime.
The report’s other recommendations include the introduction of more stringent regulations on real estate agents, and the imposition of tighter controls on traditional and alternative mortgage providers.
The Attorney-General, David Eby,told The Globe and Mail he agrees with the report’s findings. He added that the province has been pressing the federal government to do its fair share, but can no longer depend on FinTRAC.
“It’s up to us to execute basic things like regulating money service businesses, exports of vehicles, tracking large cash transactions,” he said.
“If we don’t set up the structures to last through various governments and various politicians, then the work might not get done, and that’s not an outcome we should stand for.”
But when asked if the provincial government would create its own intelligence agency, he did not answer directly.
“We embrace all of the commission’s recommendations and we look forward to working with the commissioner to implement them,” he said.
The commission’s report notes that FinTRAC received more than 31 million individual reports about suspicious transactions in 2019-2020, butrelayed only 2,057 of them to law enforcement across Canada. The commission says 355 of those reports went to B.C. authorities.
John Mayer, executive director of the Society of Notaries Public of British Columbia, said the province having its own intelligence agency would be a positive step. But he noted that the logistics, especially finding staff capable of handling such a specialized workload, would be difficult.
“And if you don’t have Crown prosecutors that are willing to pick up the ball and run with it in a timely fashion, then you’re wasting your time,” he added.
The commission’s report also recommends that the province give a clear anti-money-laundering mandate to the BC Financial Services Authority, an existing Crown corporation that regulates the province’s realtors, credit unions and mortgage lenders. Mr. Eby said the province would determine whether or not it needs to do that.
“We want the BCFSA to think of money laundering and to deal with it when they come across it, and if they need a mandate change to do that, then that’s something I know my colleagues and I will look at,” he said.
Blair Morrison, the BCFSA’s chief executive, said such a mandate would put his organization in a better position to tackle the issue. “With our view of the whole sector, I think we can be part of the solution,” he said.
Trevor Koot, the CEO of the BC Real Estate Association, which represents realtors, said agents don’t know enough aboutmoney laundering risks in their industry and need clarity on when to report related issues.
The commission’s report notes that B.C. realtors made only seven reports of suspicious transactions to FinTRAC in all of 2015-2016. In 2020-2021, they made 15.
Mr. Koot said agents have received minimal help from the federal agency. He said he supports the commission’s finding that the BCFSA is in a good position to fill some of the gap left by FinTRAC.
“Because the sector doesn’t really know what’s expected of them, there’s absolutely zero chance that they’re ever going to comply,” Mr. Koot said.
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TORONTO – One expert predicts Ottawa‘s changes to mortgage rules will help spur demand among potential homebuyers but says policies aimed at driving new supply are needed to address the “core issues” facing the market.
The federal government’s changes, set to come into force mid-December, include a higher price cap for insured mortgages to allow more people to qualify for a mortgage with less than a 20 per cent down payment.
The government will also expand its 30-year mortgage amortization to include first-time homebuyers buying any type of home, as well as anybody buying a newly built home.
CIBC Capital Markets deputy chief economist Benjamin Tal calls it a “significant” move likely to accelerate the recovery of the housing market, a process already underway as interest rates have begun to fall.
However, he says in a note that policymakers should aim to “prevent that from becoming too much of a good thing” through policies geared toward the supply side.
Tal says the main issue is the lack of supply available to respond to Canada’s rapidly increasing population, particularly in major cities.
This report by The Canadian Press was first published Sept. 17,2024.
OTTAWA – The Canadian Real Estate Association says the number of homes sold in August fell compared with a year ago as the market remained largely stuck in a holding pattern despite borrowing costs beginning to come down.
The association says the number of homes sold in August fell 2.1 per cent compared with the same month last year.
On a seasonally adjusted month-over-month basis, national home sales edged up 1.3 per cent from July.
CREA senior economist Shaun Cathcart says that with forecasts of lower interest rates throughout the rest of this year and into 2025, “it makes sense that prospective buyers might continue to hold off for improved affordability, especially since prices are still well behaved in most of the country.”
The national average sale price for August amounted to $649,100, a 0.1 per cent increase compared with a year earlier.
The number of newly listed properties was up 1.1 per cent month-over-month.
This report by The Canadian Press was first published Sept. 16, 2024.
MONTREAL – Two Quebec real estate brokers are facing fines and years-long suspensions for submitting bogus offers on homes to drive up prices during the COVID-19 pandemic.
Christine Girouard has been suspended for 14 years and her business partner, Jonathan Dauphinais-Fortin, has been suspended for nine years after Quebec’s authority of real estate brokerage found they used fake bids to get buyers to raise their offers.
Girouard is a well-known broker who previously starred on a Quebec reality show that follows top real estate agents in the province.
She is facing a fine of $50,000, while Dauphinais-Fortin has been fined $10,000.
The two brokers were suspended in May 2023 after La Presse published an article about their practices.
One buyer ended up paying $40,000 more than his initial offer in 2022 after Girouard and Dauphinais-Fortin concocted a second bid on the house he wanted to buy.
This report by The Canadian Press was first published Sept. 11, 2024.
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