Unmasking Financial Crimes: A Look into Money Laundering and Fraud in Canada

Canada has emerged as a hotspot for money laundering and fraud activities, costing citizens millions of dollars and straining government resources. In an effort to raise public awareness, the Criminal Intelligence Service Canada (CISC) has released a comprehensive report on the nature and extent of financial crimes in the country.

Money Laundering: A Hidden Threat

According to the report, money laundering poses a significant threat with the majority of organized crime groups disguising their proceeds of crime. The CISC assessed 176 such groups in 2019, but believes the actual number to be much higher. Approximately half of these groups maintain international links, and nearly half of those with international connections are involved in the cocaine market.

• Use of Cryptocurrencies: As crimes become increasingly sophisticated, criminals have turned to using cryptocurrencies to pay for mass-marketing fraud and dark web marketplace purchases. Cryptocurrencies have also proven to be an attractive tool for laundering the proceeds of their crimes.

Fraud: The Societal Strain

The damages of fraud - in the form of lost savings and untaxed revenue - can lead to significant societal strain. Some fraudulent schemes collect sensitive personal information along with money, enabling identity theft and other crimes.

Types of Fraud Schemes

The report outlines several fraud schemes targeting Canadians, including:

1. Government services schemes
2. Romance scams
3. Ransomware attacks
4. Real estate fraud

Many victims remain embarrassed and fail to report such incidents, allowing the perpetrators to continue wreaking havoc.

Financial Crimes: Beyond ‘White-Collar’

Financial crime, often perceived as a ‘white-collar’ crime, is perpetrated by skilled criminals and interconnected organized crime groups, both within and beyond Canada’s borders. Some Canadian organized crime groups even collaborate in running boiler rooms - telemarketing centers used in fraud. Others collect a portion of their profits, using these ill-gotten gains to fund other criminal activities, such as drug importation and trafficking.

Protecting Canadians

The report serves as a reminder that financial crimes are not limited to ‘blue-collar’ crimes and can have far-reaching effects. To mitigate the damage and protect Canadians, stronger anti-money laundering regimes are required.

Over the past two years, the federal government and various provincial counterparts have implemented legislative changes to strengthen these regimes.

To request a copy of the full report, contact CISC at CISC_Tasking@rcmp-grc.gc.ca.

Last modified: 2020-09-28