188.8.131.52. What is a suspicious transaction or attempted suspicious transaction?
A suspicious transaction is any real estate transaction that an agent has reasonable grounds to suspect is related to the commission of a money laundering offence. Suspicious transactions may have been completed or simply attempted by the client. Note, however, simply because a client attempts to conduct a transaction, but does not complete it, does not necessarily mean the transaction is suspicious. That said, the circumstances surrounding it might contribute to it being suspicious.
Possible indicators of suspicious transactions:
• A client arrives at a real estate closing with a significant amount of cash. (Remember that any cash amount over $10,000 MUST be recorded and reported – see Sections 3.1.4, 3.2.3 above.)
• A client purchases property in the name of a nominee such as an associate or a relative other than a spouse.
• A client does not want to put his or her name on any document that would connect him or her with the property or uses different names on Offers to Purchase, closing documents, and deposit receipts.
• A client inadequately explains the last minute substitution of the purchasing party's name.
• A client negotiates a purchase for market value or above asking price, but records a low value on documents, paying the difference "under the table".
• A client sells property below market value with an additional "under the table" payment.
• A client pays initial deposit with a cheque from a third party, other than a spouse or parent.
• A client pays substantial down payment in cash and balance is financed by an unusual source or offshore bank.
• A client purchases personal use property under corporate veil when this type of transaction is inconsistent with the ordinary business practice of the client
• A client purchases property without inspecting it.
• A client purchases multiple properties in a short time period, and seems to have few concerns about the location, condition, and anticipated repair costs of each property.
• A client pays rent or the amount of a lease in advance using a large amount of cash.
• A client is known to have paid large remodeling or home improvement invoices with cash on a property for which property management services are provided.
• A client starts to make an offer on the purchase of a house with a large deposit, but will not finalize the offer once asked to provide identification.