Blue Line

Anti-money laundering centre crunches data in fight against fentanyl

OTTAWA — Canada’s anti-money laundering agency is helping fight the scourge of fentanyl by tracing the illicit movement of funds tied to the deadly drug.

November 27, 2017  By The Canadian Press

Barry MacKillop, interim director of the federal Financial Transactions and Reports Analysis Centre, says the agency has passed intelligence about the dangerous opioid to law-enforcement partners.

Just this week, the financial data-crunching agency, known as Fintrac, was cited for its role in uncovering a Calgary-based trafficking network, leading to the seizure of more than $4 million worth of drugs, including fentanyl.

The agency tries to pinpoint cash linked to money laundering and terrorism by sifting through tens of millions of pieces of information annually from banks, insurance companies, securities dealers, money service businesses, real estate brokers, casinos and others.

Fintrac’s annual report, tabled in Parliament on Thursday, says the agency made 2,015 disclosures of intelligence in 2016-17 to partners including Canada’s spy agency, the RCMP and other police services — up from 1,655 the year before.


Of the latest disclosures, 1,366 were related to money laundering, 462 involved terrorism and threats to national security, and 187 involved all of these.

Fintrac has been working for months with police and the many institutions that supply reports about suspicious dealings to come up with common signs of fentanyl trafficking, MacKillop said in an interview.

“It is a challenge to identify the indicators that are specific to fentanyl versus heroin or cocaine or any other type of drug.”

However, source countries for various drugs differ, so geographical analysis of transactions can be helpful, he added.

Authorities have identified China as a leading source of opioids entering Canada.

Fintrac’s analysis played a role in the investigation of Kevin Omar Mohamed, a former Ontario resident who pleaded guilty to a terrorism charge for travelling to Syria with the aim of joining an extremist group.

Amid the flagging fortunes of the so-called Islamic State of Iraq and the Levant, Canadian security agencies are focusing on the possible return of dozens of young Canadians who headed overseas to fight alongside militants.

Fintrac is looking to see what type of intelligence it can generate on returnees, MacKillop said. “If we see dormant accounts, for example, that all of a sudden become reactivated, that may be an indicator.”

Last year, financial institutions committed to focusing on the tracking of money laundering associated with human trafficking in the sex trade.

The agency received about 2,000 suspicious transaction reports from businesses across Canada during the 2016 calendar year relating to these efforts — an increase of 400 per cent from the previous year, the annual report says. “The reports came from all the major banks and a number of money services businesses.”

Indicators of human trafficking for sexual exploitation include purchases of short-term stays at hotels, back-page ads for escort services, and after-hours credit card payments at strip clubs, massage parlours and modelling agencies.

Another priority for Fintrac is working with institutions to develop a stream of tips that could help uncover illicit fund movements tied to mass-marketing fraud — both the garden-variety spam campaigns that dupe the most vulnerable and more sophisticated schemes involving market manipulation and insider trading, MacKillop said.

Fintrac has made a number of disclosures to enforcement agencies related to tax evasion, though the information is not necessarily related to the leaked files known as the Panama Papers and the Paradise Papers, he said.

The Canada Revenue Agency has the federal lead on examining the papers and will determine whether Fintrac can be of assistance, MacKillop added.

– Jim Bronskill

News from © Canadian Press Enterprises Inc., 2017

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