Money laundering target of changes to B.C. Civil Forfeiture Act

The B.C. government says it’s making changes to the Civil Forfeiture Act to target money laundering and organized crime.

The province says the goal is to make “gang life unprofitable,” by using measures to seize things like expensive vehicles, homes, and luxury goods that are deemed the proceeds of crime.

The amendments are based on some of the recommendations from the Cullen Commission into money laundering, released in June 2022. It found an unprecedented volume of illicit cash was laundered through B.C. casinos over the course of a decade.

Former B.C. Supreme Court Justice Austin Cullen added while a lot of the money laundering happened in the shadows, “some has happened in plain sight.”

Unexplained wealth orders

The “suite of new tools” announced Thursday is expected to help the government get to the bottom of what it refers to as “the common money-laundering techniques.”

In addition to amendments to the Civil Forfeiture Act, the provincial government says it’s also creating “unexplained wealth orders (UWOs),” which would require people to “explain how they acquired their assets if there is suspicion of unlawful activity.”

“Money-laundering schemes have become increasingly sophisticated, and unexplained wealth orders will be a key tool in our toolbox to combat organized crime,” said B.C. Public Safety Minister and 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.”

The province explains UWOs target criminals who are also responsible for the toxic drug supply plaguing the province. The government says the orders will “help the Civil Forfeiture Office (CFO) build stronger cases against assets used in organized crime, drug trafficking, and money laundering.”

Farnworth says the province is “confident” the changes will withstand court challenges.

“There is already a similar piece of legislation in place in Manitoba. We have looked at the unexplained wealth orders legislation that exists in New Zealand, Ireland, and the U.K., and we know that the U.K. made an initial introduction. At that time, they had some challenges, we’ve learned from their challenges, we’ve worked with our legal departments. Based on previous rulings from federal courts, supreme courts, in terms of our civil forfeiture approach, we think this approach will withstand any challenges,” he said.

The public safety minister stood firm when asked about concerns around charter rights and potential abuse by the system, calling unexplained wealth orders an “effective tool” that the province expects “will work here.”

“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,” Farnworth said.

“You only have to look at how many people get targeted in online scams, for example, telephone scams, to try and … rob people’s assets. We have to keep up with that sophistication. Unexplained wealth orders work, they send a very strong message that your ill-gotten gains will be taken, we have built safeguards into the legislation. Unlike civil forfeiture, which is an administrative penalty approach, this is a court — it is a court that looks at the evidence … and it is a court that will make that decision in terms of a forfeiture.”

Related articles: 

• Money laundering not main cause of rising B.C. home prices, Cullen commission finds

• Casino operators tell B.C. money laundering public inquiry they followed money rules

• Special prosecutor decides against charges in B.C. money laundering investigation

Other changes to the Civil Forfeiture Act include making it easier to get information from public organizations like real estate boards; “eliminating the limitation period on forfeiture proceedings”; and targeting what the province calls the “illegal cannabis market.”

Money that comes from seized assets that are then sold will be used to support the prevention of crime, as well as supporting victims, the province says.

It adds $70 million has been distributed through grants to support such programs by the CFO since 2006.

You can read the full Cullen report here.