The B.C. government has introduced legislation that will expand the use of the Civil Forfeiture Act to go after proceeds of laundered money in the province.
Among the amendments to the act are the creation of unexplained wealth orders, which the province says will require people to explain how they acquired assets such as houses if investigators believe there is the possibility of unlawful activity.
The amendments will also allow the Civil Forfeiture Office to look for property hidden in the names of trustees of a trust, or family members.
“Just because the mob’s boss’s spouse isn’t involved in illegal activity, doesn’t mean they get to keep the house,” said Solicitor General Mike Farnworth.
“By exposing property for forfeiture actions, we are removing this incentive and sending a clear message to anyone involved in organized crime that crime doesn’t pay.”
Similar laws exist in Manitoba, as well as Australia, Ireland, New Zealand and the United Kingdom.
This week, the province also announced the creation of a public registry to help end hidden ownership in private businesses, along with new regulations for money services businesses.
Cullen report recommendation
Confiscating unexplained wealth was one of the recommendations in the Cullen Report, which estimated that billions of dollars worth of illicit funds have poured into the province, especially in casinos and real estate.
Civil forfeiture has existed in B.C. since 2006, allowing the province to confiscate people’s property without any criminal charges attached.
Premier David Eby announced the expansion of the program to include unexplained wealth orders earlier this year, but civil libertarians have objected, arguing they undermine the presumption of innocence and place an onus of proof on the target of the seizure order.
“It creates a scenario where British Columbians may be forced to go to court to prove they aren’t criminals, and in our view that’s simply unconstitutional,” said Vibert Jack, litigation director for the B.C. Civil Liberties Association.
“The vast majority of the time it is used against people who are actually poor and marginalized instead of rich criminals.”
Calvin Chrustie, a former RCMP senior operations official for transnational crime, raised concerns that the people and organizations doing the majority of money laundering would find ways to evade the new tools.
“I commend them for the initiative, I am concerned about the magnitude of the problem,” he said.
“It may impact some of the lower level but I question in terms of what it can do in terms of the higher level.”
Farnworth defended the program and said the unexplained wealth orders aspect would have guardrails, including the Civil Forfeiture Office having to satisfy court that there was a serious question over whether a property was directly or indirectly acquired as a result of unlawful activity.
“I think the public is fed up and sick and tired of organized crime and the increasingly sophisticated ways in which they hide their ill-gotten gains,” he said.
“We have to keep up with that sophistication. Unexplained wealth orders are … an effective tool, it’s being used in a number of jurisdictions, and we expect it will work here.”