FOLLOWING THE TRAIL

Organized crime and money laundering are not only found in big cities.
Salmon Arm could be a target too, said Cpl. Dennis Blommaert, of the
Vancouver RCMP.

In a recent presentation by the Integrated Proceeds of Crime Section
of the RCMP, Blommaert talked about ways in which money is laundered
in big cities and small.

"Don't look to the big cities or the big organized groups," Blommaert
said. "It could be your next-door neighbour."

Money laundering is the process of concealing cash gained illegally to
make it look legitimate.

Blommaert said some activities that lead to money laundering are
prostitution, drugs and fraud.

The money becomes harder to track when launderers use legitimate
businesses to launder their money. For example, money launderers will
use restaurants and bars, where there is a large amount of cash flow,
to conceal their money by overstating profits.

Blommaert said much of the money used in drug deals is also laundered.
Drug dealers take their money to currency exchange places and banks in
amounts under $10,000, so as not to look suspicious. They then make
large purchases in cash, which should be a red flag to businesses,
Blommaert said.

There are three stages of money laundering. The first is placement, or
the collection of dirty money. The next is layering, where the
launderers transfer the money to various accounts and banks, making it
harder for the police to trace it. Lastly is integration, where the
money is used to buy assets such as vehicles, real estate, aircraft
and jewelry.

Large organizations can launder upwards of $1 million a day, Blommaert
said.

He also said white label, or no-name ATMs that are owned privately,
have become a major problem with money laundering because they have no
records of cash-flow.

Blommaert said there are ways to recognize when money has been
laundered. He said businesses should be on the watch for customers who
want to make large purchases in cash, particularly in $20 bills
because they are most commonly used in the drug business. Other clues
include: assets purchased in a different person's name, someone who
does not want to show identification, someone who has difficulty in
explaining where the money came from, or someone who does not care
about the price or does not look like he or she can afford the purchase.

"They look for people with weaknesses," Blommaert said, such as single
parents, people on welfare or slow businesses.

The effects of money laundering on small businesses can be
devastating. Blommaert said things to consider are competition,
reputation if you accept laundered money, and public safety. Some
small businesses are overtaken by competition when the competitor is
using illegal funds.

"You can be touched by it and not even know about it," Blommaert said.
"You don't know who they are."

June Stewart, business analyst at Community Futures, said she attended
the meeting to find out more about how money laundering works.

"We're in the money lending business, so we just wanted to be more
aware," Stewart said. "I didn't know all the ways of money
laundering."

There is one organization that works to stop money laundering.
Canada's Financial Intelligence Unit is an independent organization
that works with police to monitor large cash transactions. Businesses
can report suspicious activities to the unit, which then reports them
to the police. FINTRAC can track money transactions to find out if
they are illegitimate.