Ottawa warns on gold-backed Web trades
Kevin Carmichael, The Globe and Mail
May 26, 2008
FINTRAC sees potential abuse of electronic transactions tied to gold and silver
OTTAWA — Canada’s financial intelligence agency warns that criminals may be exploiting Internet-based companies that convert cash into electronic gold, exposing a new front in the international effort to restrict terrorist financing and money laundering.
While other channels of money laundering are successfully being shut down, authorities are increasingly worried about a proliferation of “digital precious metals operators” websites that offer clients a chance to conduct Internet business in units backed by gold and silver rather than paper currencies.
The Financial Transactions and Reports Analysis Centre of Canada, or FINTRAC, says in a report these websites have “achieved critical mass on the Web” and are facilitating millions of transactions on the fringe of the international financial system – the equivalent of a Wild West where legitimate businesses, privacy-seeking individuals and criminals can mingle just out of reach of the law.
At stake is the effectiveness of the financial reporting rules that countries such as the United States, Britain and Canada enacted in response to the Sept. 11, 2001, terrorist attacks. A network that allows individuals to move money around the world means criminals can avoid commercial banks and other financial institutions required to turn over their records to the government.
“As financial institutions and non-financial businesses increasingly deter money laundering and terrorism financing, adaptable and technology-savvy criminals and terrorist financiers will likely see other unregulated, exploitable avenues to further their nefarious purposes,” concludes the report, which was made available under the Access to Information Act.
“Digital precious metals may become one of them.”
FINTRAC, which gathers and analyzes data on financial transactions for law enforcement under oversight of Finance Minister Jim Flaherty, stresses in the 21-page report that websites offering precious metals accounts are serving a “legitimate market demand.”
So-called “e-currencies” backed by gold are attractive to companies and individuals involved in international business because they eliminate the risk of fluctuating exchange rates adding to the cost of a transaction.
…
Most digital precious metals websites are run by responsible managers who report all suspicious activity to the police, said Maylin dela Cueva, director of the Global Digital Currency Association.
Starting later this year, Canadian dealers of precious metals and stones – both real and digital – must register with the government.
June 9th, 2008 at 10:47 am
[...] Canadian’s FINTRAC has imposed compulsory registration with digital money that deals with gold, or digital gold. Ottawa warns on gold-backed Web trades FINTRAC sees potential abuse of electronic transactions tied … [...]
June 13th, 2008 at 11:47 am
WoW. Enough of the scare tactics and fear mongering. You people talk to the citizens like they are stupid. You think just because you say the word “Terrorist” that people will buy your crap? Perhaps the idiots suffering from the effects of floridated water will buy what mainstream media says, will buy it. Metal is the only real currency. How much of the Canadian currency is over-inflated by all the credit products available today. Anyone else notice how many credit products are available when compared to 10 years ago. Seriously, cut it out!
January 27th, 2009 at 2:41 pm
[...] [...]
January 28th, 2009 at 5:44 pm
[...] Big Banks Immunity from Lawsuits over Derivatives Losses | Financial ’super cop’ role for Fed | Ottawa warns on gold-backed Web trades | Inflation takes over as public enemy No. 1 | Fed eyes Nordic-style nationalisation of US banks | [...]
January 30th, 2009 at 7:33 pm
[...] Big Banks Immunity from Lawsuits over Derivatives Losses | Financial ’super cop’ role for Fed | Ottawa warns on gold-backed Web trades | Inflation takes over as public enemy No. 1 | Fed eyes Nordic-style nationalisation of US banks | [...]
February 20th, 2009 at 2:42 pm
[...] Big Banks Immunity from Lawsuits over Derivatives Losses | Financial ’super cop’ role for Fed | Ottawa warns on gold-backed Web trades | Inflation takes over as public enemy No. 1 | Fed eyes Nordic-style nationalisation of US banks | [...]
March 15th, 2009 at 10:48 am
[...] to carry ‘carbon ration cards’, say MPs | Revamped copyright law targets electronic devices | Ottawa warns on gold-backed Web trades | Farmer Surveilled, Raided for Natural Milk Operation has Trial Delayed | Canada’s C-51 Law May [...]
April 23rd, 2009 at 3:51 pm
[...] Big Banks Immunity from Lawsuits over Derivatives Losses | Financial ’super cop’ role for Fed | Ottawa warns on gold-backed Web trades | Inflation takes over as public enemy No. 1 | Fed eyes Nordic-style nationalisation of US banks | [...]
May 21st, 2009 at 11:22 am
[...] [...]
October 1st, 2009 at 2:05 pm
[...] [...]
October 17th, 2009 at 5:50 am
[...] [...]
November 5th, 2009 at 4:39 pm
[...] Flashback: Plentiful paper currency buffing gold’s shine | Gold continues record-breaking run | Gold price rises to all-time high | Fisk: Nations to hasten demise of dollar in new world order | IMF approves $13bn gold sale to boost lending fund | Gold regains $1,000 | Gold toys with $1000/oz | Industrial demand for silver sharpens bullish view | Global demand for gold investment soars 38% in past year | The search for the mint’s missing gold | Royal Canadian Mint’s ‘lost’ gold worth a mint | Bullion and Bandits: The Improbable Rise and Fall of E-Gold | Has the Mint’s gold vanished? | Bank crisis spawns new kind of gold rush | Gold Tops $1,000, First Time Since March as Recession Deepens | Manipulation Of Gold And Silver Prices Further Exposed | Analysts Predict Hyper-Inflation To Push Gold To $2000, Oil to $300 | Ottawa warns on gold-backed Web trades [...]
June 21st, 2010 at 3:24 pm
[...] Related: Gold price hits new record as it breaks through $1,250 | Iran To Dump 45 Billion Euros For Gold Bullion & Dollars | Gold vaults nearly 3% to record high $1234, BMO sees $1600 horizon | Gold nears record high as stocks plunge | Manipulation of Gold Market by Financial Giants Exposed at CFTC Hearing | Davos 2010: George Soros warns gold is now the ‘ultimate bubble’, calls for IMF to handle climate fund | We’re running out of gold: miners | Gold rallies to record above $1,100 | Gold prices surge as India buys IMF reserves | Plentiful paper currency buffing gold’s shine | Gold continues record-breaking run | Gold price rises to all-time high | Fisk: Nations to hasten demise of dollar in new world order | IMF approves $13bn gold sale to boost lending fund | Gold regains $1,000 | Gold toys with $1000/oz | Industrial demand for silver sharpens bullish view | Global demand for gold investment soars 38% in past year | Bullion and Bandits: The Improbable Rise and Fall of E-Gold | Has the Mint’s gold vanished? | Bank crisis spawns new kind of gold rush | Gold Tops $1,000, First Time Since March as Recession Deepens | Manipulation Of Gold And Silver Prices Further Exposed | Analysts Predict Hyper-Inflation To Push Gold To $2000, Oil to $300 | Ottawa warns on gold-backed Web trades [...]
June 23rd, 2010 at 10:04 am
[...] Related: Gold tops $1260 for new historic high | Why Governments Hate Gold | Gold price hits new record as it breaks through $1,250 | Iran To Dump 45 Billion Euros For Gold Bullion & Dollars | Gold vaults nearly 3% to record high $1234, BMO sees $1600 horizon | Gold nears record high as stocks plunge | Manipulation of Gold Market by Financial Giants Exposed at CFTC Hearing | Davos 2010: George Soros warns gold is now the ‘ultimate bubble’, calls for IMF to handle climate fund | We’re running out of gold: miners | Gold rallies to record above $1,100 | Gold prices surge as India buys IMF reserves | Plentiful paper currency buffing gold’s shine | Gold continues record-breaking run | Gold price rises to all-time high | Fisk: Nations to hasten demise of dollar in new world order | IMF approves $13bn gold sale to boost lending fund | Gold regains $1,000 | Gold toys with $1000/oz | Industrial demand for silver sharpens bullish view | Global demand for gold investment soars 38% in past year | Bullion and Bandits: The Improbable Rise and Fall of E-Gold | Has the Mint’s gold vanished? | Bank crisis spawns new kind of gold rush | Gold Tops $1,000, First Time Since March as Recession Deepens | Manipulation Of Gold And Silver Prices Further Exposed | Analysts Predict Hyper-Inflation To Push Gold To $2000, Oil to $300 | Ottawa warns on gold-backed Web trades [...]