Putting an end to snow-washing: The case for a publicly accessible corporate registry of beneficial owners in Canada

James Cohen and Sasha Caldera
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James Cohen: Executive Director, Transparency International Canada, Canada
Sasha Caldera: Beneficial Ownership Transparency Campaign Manager, Publish What You Pay Canada, Canada

Journal of Financial Compliance, 2021, vol. 4, issue 4, 379-390

Abstract: The term ’snow-washing’ was discovered by Toronto Star and CBC journalists investigating the 2016 Panama Papers. The term allegedly comes from the intermediaries at Mossack-Fonseca, the law firm at the heart of the Panama Papers, where they essentially sold Canada with the idea of bringing dirty money to Canada and it will be cleaned like the pure white snow; hence, ’snow-washing’ entered the Canadian anti-money laundering (AML) lexicon. This reputation came about because Canada has a weak corporate transparency regime, with exceptionally little beneficial ownership reporting and AML enforcement. Canada’s beneficial ownership gaps have been known and reported by international organisations for some time. There have been a number of AML updates in Canadian regulations in preparation of the 2021 Financial Action Task Force (FATF) peer review, but as of writing, the largest piece of the enforcement puzzle has been whether a publicly accessible beneficial ownership registry will be implemented. In this paper, we argue why a publicly accessible beneficial ownership registry is a critical tool that Canada can implement to end snow-washing. To make the case for a publicly accessible beneficial ownership registry, we will discuss the background of Canada’s beneficial ownership regime; global trends and findings on beneficial ownership registries and how Canada can navigate the challenges of implementing such a registry in a federated country as well as balance privacy concerns.

Keywords: beneficial ownership; antimoney laundering; public beneficial ownership registry; Canada; Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA) (search for similar items in EconPapers)
JEL-codes: E5 G2 K2 (search for similar items in EconPapers)
Date: 2021
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