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Terrorists Funnel Money

Posted on Saturday, November 08 at 07:00 by polemarch1

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The report says Fintrac passed on a total of 103 cases to police involving $460-million worth of possible money laundering and terrorism transactions.

Of that amount, 24 cases involving $22-million related to terrorist groups, 78 involved money laundering and one involved both. The report is for the year ended March 30.

Fintrac was created by the federal government in 2000 to help uncover illegal financial activities.

However, it has been only in the past year that the government completed the reporting requirements for a wide variety of entities, including financial institutions, brokerage firms, casinos and real estate agents.

Horst Intscher, Fintrac's director, said the number and amounts involved in terrorism-related cases is cause for concern.

"Although $22-million is not large in comparison to the value of the money laundering disclosures we've made, given the relatively small amounts of money that are involved in perpetrating the terrorist act, $22-million is a figure that we need to take quite seriously," he said.

He added that money laundering is generally easier to spot than terrorism financing.

"Money laundering tends to involve very larges sums of money. People who do it spend pretty much all of their time doing that. So provided you look in more or less the right direction, you can see a bulge and that will start you looking more closely," he said.

"Terrorism involves much smaller sums of money and often it involves activities by people who also do a number of other things. So that makes it much more difficult to spot."

He added that Fintrac began tracking terrorism cases only last year, and he had expected five or six cases.

"When we started on this, people talked about terrorist financing involving minuscule amounts of money, and therefore it might not even be detectable. We were surprised a bit, I think, and educated by what we discovered, namely that there are larger sums of money."

John Thompson, director of the Toronto-based Mackenzie Institute, which specializes in security issues, said he was not surprised by the findings.

Fintrac "is only getting started and, frankly, I think that's only a fraction of the money [terrorist groups] raised in Canada," he said. He added that Sri Lanka's Tamil Tigers alone are believed to raise about $25-million annually in Canada.

Several other terrorist groups, such as the Revolutionary Armed Forces of Colombia (known by its Spanish acronym of FARC), are linked to the cocaine trade, he said, which makes tracking their financial transactions difficult.

Mr. Intscher said Fintrac expects to report twice as many total suspicious cases this year because all of the reporting rules are now in place.

The agency has already passed along 90 cases to police, involving transactions totalling about $300-million, for the period April 1 to Sept. 20.

Fintrac receives about 24,000 reports each day from thousands of institutions and businesses (by law, cash transactions worth more than $10,000 must be reported to Fintrac).

The agency analyzes the reports and forwards any suspicious cases to the RCMP, the Canadian Security Intelligence Service and other police services. Last year, Fintrac referred cases to 13 police agencies in Canada and to eight foreign services.

Mr. Intscher said most of the money laundering and terrorism activity takes place in Toronto, Vancouver and Montreal.

"They try to hide it where there is a whole lot of other activity going on. You tend to find it more in those three centres because those are big banking centres," he said.

From the Globe and Mail

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