Another part of Peter German’s phase two money laundering report was released today, and while there isn’t money laundering in horse racing, it is rampant in the sale of luxury cars.
Attorney General Dave Eby says the German report found “straw buyers” were buying up luxury cars and shipping them overseas.
And they weren’t shy about it even applying for PST refunds.
“Before 2013, there were about 100 vehicles a year receiving the refund,” he says. “In 2016, PST was rebated on 3,674 vehicles. Since 2013 almost $85 million in PST refunds had been paid by government for the export of vehicles.”
Eby says he was shocked to discover gangsters were filing for PST rebates.
A straw buyer is someone who buys something on behalf of another person in order to bypass laws.
Peter German says luxury car dealers reported large cash transactions are quite routine citing on transaction for a rare car bought with $240,000 in cash.
“The dealer accepted the money, sold the car, and then made sure that he was accompanied by two or three fellow employees as they marched the money down to the bank. The teller asked what is this from? It is from a car sale she says okay thank you. Then they would presumably fill out a large cash transaction report but there is nothing suspicious because there is no reporting involved and there is no visibility on that point of sale.”
However former Police Chief Doug LePard, who was on the Peter German investigation team, says organized crime is already moving away from cash purchases.
“There is this trend towards using foreign credit cards that are not transparent in anyway. The money is coming from a foreign country and there is no visibility to law enforcement.”
Eby says once again the Peter German report found a shocking lack of police resources.
“Our ports must be crowded with containers containing luxury vehicles,” he added. “Dr. German notes that our reports do not have a dedicated police presence.”
He says the next step involves stronger regulations and enforcement much like we recently saw with a crack down on B.C.’s scrap metal industry.
Another part of the German report targeting real estate has yet to be released.
