Definition
Real estate is one of the sectors most exposed to money laundering due to the high amounts involved and relative opacity of beneficial ownership. Canada has been criticized in international reports (notably the 'Vancouver model' affair) for surveillance gaps.
Common methods: - Cash property purchases or through shell corporations - Overvalued transactions between related parties - Fictitious loans repaid with illicit funds - Quick resales at different prices to 'legitimize' funds
Legal obligations in Canada: - Real estate agents, notaries, and mortgage brokers are FINTRAC reporting entities - Must verify client identity (KYC) and fund sources - Obligation to report suspicious transactions without alerting the client
Beneficial ownership registry: Quebec and the federal government are strengthening beneficial ownership registries to identify true owners behind corporations and trusts.