MONEY LAUNDERING BIG PROBLEM

Money laundering -- turning illegal or 'dirty' money into legal or 'clean'
money -- is a big problem in Saskatchewan and getting bigger all the time,
says an RCMP commercial crime investigator.

Sgt. Doug Pott, of the force's integrated proceeds of crime division, said
$1.4 million in assets, including cash and property, were seized by law
enforcement agencies in Regina and Saskatoon in 2003.

In addition, $572,000 was collected from individuals found guilty of money
laundering through the courts last year, Pott added.

At the half-way point this year, seizures of cash and property obtained
through money laundering have increased "dramatically" to nearly $2
million, with another $230,000 collected through the courts, Pott said.

"If you don't think (money laundering) is happening here, the stats speak
for themselves," Pott told Regina members of the Better Business Bureau of
Saskatchewan (BBB) on Tuesday.

Pott said most of the money being laundered in the province is obtained
from trafficking illegal drugs, mainly marijuana, cocaine and
methamphetamines, better known as crystal meth.

As the illicit drug trade has increased, so has the incidence of money
laundering through financial institutions, real-estate firms, casinos,
retailers and car dealers.

"We're trying to stem the tide of money laundering in the province. (But)
it's growing exponentially," Pott said.

That's why the integrated proceeds of crime division is working with the
BBB through the Merchants Against Money Laundering program to educate
business owners about money laundering.

"Our whole purpose ... is to educate the public and make them aware that
this (money laundering) is happening in the province," Pott said.

Randie Jelinski, one of the program co-ordinators in Saskatchewan, said
money launderers try to avoid detection by breaking up their ill-gotten
gains into smaller amounts.

For example, a trafficker might distribute $50,000 in drug profits through
hirelings or "smurfs" who each take $10,000 and deposit $5,000 into two
different bank accounts.

By "smurfing" the $50,000 in drug profits, the money launderer avoids
suspicion by remaining below the "large cash transaction" threshold of
$10,000 as defined by the Money Laundering and Terrorist Financing Act.

Similarly, the trafficker will launder money through real-estate firms and
car dealerships by using the drug proceeds to purchase property or vehicles
that can later be sold legally. Smurfs will actually make the purchases, so
the transaction can't be connected to the drug dealer, Jelinski said.

Casinos are another favourite method of laundering money, once again
through smurfs, who will convert the 'dirty' money into gambling chips,
which are then cashed out as 'clean' money.

Businesses should be aware of the 'red flags' of money laundering, such as
bundling of cash, the conversion of small bills to large denominations,
frequent transferring of money from account to account, frequent deposits
of cash under the $10,000 threshold, and depositors who provide as little
personal information as possible.

Business owners should also be aware that the penalties for failing to
report a large cash transaction or electronic funds transfer could result
in a fine of up to $1 million. Failure to report a suspicious transaction
could mean a $2 million fine and up to five years in jail.

Businesses should report suspicious activity to the Financial Transactions
and Reports Analysis Centre of Canada (FINTRAC) in Ottawa by calling
1-866-226-2346 or visit its Web site at www.fintrac.gc.ca

If you suspect someone of money laundering, contact Saskatchewan Crime
Stoppers at 1-800-222-TIPS (8477).