An investigative report is highlighting the role some financial advisors may have played in helping Chinese nationals spirit millions of dollars out of their country and into Canadian real estate among other key investments
A Globe and Mail investigative report revealed affluent Chinese investors are breaking one of their country’s laws -- which limits the amount of money that can be removed per year – often to purchase Vancouver real estate; all with the help of large financial institutions.
According to the investigation, banks have flagged over 8,200 suspicious transactions since 2012, the year China started cracking down on corruption. 96% of those transactions were carried out by the big banks, and many involved suspected money laundering, according to FinTRAC.
According to the Globe and Mail:
It is illegal for Chinese citizens to remove more than $50,000 (U.S.) a year from China without government permission, partly to stop corrupt millionaires from fleeing with their money. But a review of B.C. court cases by The Globe found they have worked around this restriction by sending millions of dollars into Vancouver-area banks through multiple wire transactions of smaller amounts by family and friends.
In one case, a B.C. court heard that former CIBC Financial Advisor Guiyun Ogden facilitated 10 wire transfers into 10 different accounts for a total of $500,000.
"This process is often conducted using different remitters in the same Chinese city sending funds to one or more accounts in CIBC, then through a common financial adviser get the funds collected back in one account – to be paid out to a law firm," testified Kim Clark, a CIBC corporate-security investigator, according to the Globe.
According to Clark, the transactions allowed the individual to argue, “'I am not bringing in $500,000 (U.S.) from China; me and these nine other third parties are each bringing in $50,000.'"
Of all the big banks contacted by the Globe and Mail only RBC specially answered whether or not it handled wire transfers
"Multiple wire transfers may be indicative of suspicious transactions," spokesman Don Blair told the publication. "Where RBC is of the view that a suspicious transaction report needs to be filed with FinTRAC, we will do so. In addition ... RBC may close accounts and terminate relationships."
According to the investigation, banks have flagged over 8,200 suspicious transactions since 2012, the year China started cracking down on corruption. 96% of those transactions were carried out by the big banks, and many involved suspected money laundering, according to FinTRAC.
According to the Globe and Mail:
It is illegal for Chinese citizens to remove more than $50,000 (U.S.) a year from China without government permission, partly to stop corrupt millionaires from fleeing with their money. But a review of B.C. court cases by The Globe found they have worked around this restriction by sending millions of dollars into Vancouver-area banks through multiple wire transactions of smaller amounts by family and friends.
In one case, a B.C. court heard that former CIBC Financial Advisor Guiyun Ogden facilitated 10 wire transfers into 10 different accounts for a total of $500,000.
"This process is often conducted using different remitters in the same Chinese city sending funds to one or more accounts in CIBC, then through a common financial adviser get the funds collected back in one account – to be paid out to a law firm," testified Kim Clark, a CIBC corporate-security investigator, according to the Globe.
According to Clark, the transactions allowed the individual to argue, “'I am not bringing in $500,000 (U.S.) from China; me and these nine other third parties are each bringing in $50,000.'"
Of all the big banks contacted by the Globe and Mail only RBC specially answered whether or not it handled wire transfers
"Multiple wire transfers may be indicative of suspicious transactions," spokesman Don Blair told the publication. "Where RBC is of the view that a suspicious transaction report needs to be filed with FinTRAC, we will do so. In addition ... RBC may close accounts and terminate relationships."
