It’s about to get much, much tougher for foreign nationals, and Canadians living and travelling abroad to buy or sell real property in Canada. On June 30, 2008 bill C-25 (the money laundering and terriost financing act) will go into effect that will greatly increase the hoops these people (and their local representatives) will have to jump through.
In the past we have required that people abroad provide identity documents when they were listing or buying a property through a brokerage. This, along with an obligation for Realtors to report suspicious transactions has been the norm for some time. Bill C-25 will require Canadian brokerages to contact an agent to confirm the identity of the client (we don’t know who would be authorized or acceptable to confirm the client’s identity).
Basically this means I’ll have to hire someone I don’t know in a foreign country to verify the identity of someone I already didn’t know. Lol…I’ll bet this sounded good around the planing table but in reality it’s a joke. In the years I’ve been selling real estate many of the people I’ve dealt with in other countries are the only people I know there! There are some other issues with the legislation that are notable that I won’t get into here.
With no guidance of what will be acceptable verification, and no idea of what the penalties will be for unacceptable identification, we will likely suspend any dealings of this nature until we have more information or at least a clarification of the rules.
In the end it will likely increase the cost of these transactions significantly and could potentially cause major delays well beyond the current norm which can be lengthy as it is. I had one sale earlier last year with a client in Hong Kong take 8 months to close as it was.
Heh. I guess this Bill is about as popular with realtors as it is with bankers.
If it’s any consolation, the guidance on what’s acceptable I.D. seems pretty clear, at least for financial institutions: 2 pieces, government issued, at least 1 with a photo, that together establish the person’s country or residence. The agent abroad is confirming that they saw the person’s face and the photo i.d. and verified it’s the same person.
Will is catch terrorists and criminals though? Personally I’m a bit doubtful.
I’m surprised that this wasn’t the standard before.
I worked for a bank based out of europe for a few years and between the EU’s Financial Services Authority and Canada’s money laundering protection, we had to jump through hoops with a lot of clients.
Shit like this should convince people to go to the polls on election days.