“Snow-washing” dirty money in Canada
SNOW WASHING
Canada’s reputation as the good guy of geopolitics -- the wholesome, plaid-shirted, crinkly-eyed member of the G7 (I have Canadian citizenship, I’m allowed to say these things) – was, if anything, bolstered during the Donald Trump years. Whatever knots its southern neighbor tied itself in, Canada just carried on in a rational, straightforward, bilingual, steady-as-you-go manner.
But people interested in money laundering have always been a little concerned by the shenanigans beneath Canada’s outdoorsy exterior. It wasn’t just the pioneering golden visa program, which became so over-heated that it had to be abolished back in 2014 (except in Quebec) to prevent officials being overwhelmed by applicants, or the Vancouver property market, which became so over-heated that an official enquiry was launched into money laundering, but also the whole phenomenon of “snow-washing”.
To be honest, I’ve never been entirely persuaded by the term “snow-washing,” which a Toronto tax lawyer coined to describe how money is being laundered in Canada until it is “clean as the driven snow of the Great White North” (in contrast to the sunnier places further south that are usually thought of as dodgy). But the phenomenon is real enough.
The mechanism of snow-washing is broadly the same as that used by financial criminals in Britain, or indeed, Nevada. Innocent-appearing Canadian-registered shell companies are created to move money or hold assets, while themselves being owned in tax havens that guarantee anonymity to company owners.