[2018] Criminal charges stayed in major British Columbia money-laundering investigation


Criminal charges stayed in major B.C. money-laundering investigation

Federal prosecutors, RCMP not providing details on why the charges against Silver International Investments, Caixuan Qin and Jain Jun Zhu were stayed
Criminal charges have been stayed relating to a high-profile RCMP investigation that alleged money laundering, underground banking and suspected drug cash used to fund VIP Chinese gamblers in B.C. casinos.
And now, the RCMP is conducting a review in an attempt to identify what police “activities” could have contributed to the charges being stayed, said Sgt. Marie Damian in a statement on Wednesday.
“The RCMP is conducting a full scale review to understand its activities which contributed to this stay, and will incorporate relevant lessons learned into its investigative practices and processes where necessary,” Damian wrote in an emailed statement. “More importantly, how to mitigate against the possibility this set of circumstances occurs again in the future.”
Last week in Richmond provincial court, charges were stayed by the Crown on money laundering the proceeds of crime, possession of property obtained by crime and two counts of failing to ascertain the identity of a client against Silver International Investments Ltd., Caixuan Qin (born 1984) and Jain Jun Zhu (born 1975).
These were the only criminal charges related to the RCMP’s E-Pirate investigation, where the Mounties allege they uncovered more than $500 million from a Richmond money-laundering service they said handled up to $1.5 million a day.

Just before the stay of charges, a five-week trial had been scheduled for Qin, Zhu and Silver International stretching from January to April in 2019.

On Tuesday, federal prosecutors and police would not say explicitly why the charges were stayed.
RCMP national headquarters spokeswoman Staff Sgt. Tania Vaughan said in a written statement the charges were stayed for several reasons that materialized during the course of the file, the nature of which will not be discussed in any detail given operational sensitivities.
“We have no further comment at this time,” Vaughan said from Ottawa.
“The RCMP, in collaboration with its partners, remains committed to combating money laundering and financial crime,” she added.
In a written statement, Public Prosecution Service of Canada spokeswoman Nathalie Houle said the charges did not meet its prosecution test, which stipulate there be a reasonable prospect of conviction on evidence likely to be available at trial and it would best serve the public interest.
In response to the stayed charges, Matt Nathanson, a lawyer for Silver International, said: “I have no comment on these matters.”
Money laundering and its effects on the B.C. economy — including in thereal estate market — have been a heated issue of public concern in the province.
In June 2018, B.C. Attorney General David Eby released a damning independent report on money laundering that found certain Lower Mainland casinos had served as laundromats for the proceeds of organized crime.
Eby has ordered a followup investigation into the flow of dirty money into real estate with a final report expected in March.

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The B.C. Attorney General’s office didn’t immediately have a comment Tuesday on the stayed charges.
In a rolling Postmedia investigation published last year, RCMP and B.C. government documents obtained through freedom-of-information allege that organized criminals used Silver International as an illegal bank to wash drug money. According to the allegations, a network of “private lenders” in Richmond lent cash from Silver to VIP gamblers recruited from China. These high-rollers visited B.C. for gambling junkets, according to these allegations, and received hockey bags full of cash.
Officials allege these loans allowed wealthy gamblers to get money in Canada, bypassing China’s tight-capital export controls, and pay back the loan through underground banks in China. The VIPs were able to buy betting chips with street-cash $20 bills, mostly at Richmond’s River Rock Casino, and later cash out with $100 bills more suitable for investment in B.C., an audit by B.C.’s gaming enforcement policy branch alleges.
Silver International, which was incorporated in 2014, operated in a unit of an office complex at 5811 Cooney Rd. in Richmond.
Corporate records indicate that Caixuan Qin is the director of Silver International.
An October 2014 filing in B.C. small claims court alleges that the owners of Silver International failed to pay a Richmond contractor for installing a glass door with an electric lock at Silver’s office. Silver International counter-claimed for deficient work, alleging: “It was a material term of the contract that the glass must be bullet-resistant.”
In late August, at a Vancouver conference attended by law enforcement officials, RCMP Insp. Bruce Ward outlined the details of E-Pirate. The investigation started with surveillance of gambling and cash drops at River Rock Casino, documents say, which led to Silver’s cash house, about a 10-minute drive away.
Ward said RCMP surveillance identified 40 different organizations linked to Asian organized groups dealing cocaine, heroin and methamphetamine. Individuals were delivering “suitcases laden with cash” to Silver’s cash house.
Describing a typical cash drop, Ward said: “They would put $100,000 into a hockey bag, show up at the casino, and give (the VIP gambler) $100,000 … the loaning out would go to Chinese offshore gamblers coming into Canada.”
In a raid on Silver International’s office in October, 2015, civil forfeiture documents allege, Mounties seized over $2 million in mostly $20 bills, plus ledgers and daily transaction records. Based on ledgers, police alleged that in only one year, Silver laundered $220 million in cash in B.C., and sent over $300 million offshore, according to Ward.
With Postmedia files.
[email protected]

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By piotrbein