On June 6, 2016, Cornwall Newswatch reported that on May 21, 2016 the Canada Border Services Agency (“CBSA”) seized $USD 129,000 at the Cornwall border crossing.  The money had not been reported by two travelers and was seized under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (the “Proceeds of Crime Act“).  Two travelers were referred to secondary inspection for a review of their travel documents.  During a secondary inspection, the CBSA officers found a grocery bag with 13 shrink-wrapped bags filled with U.S. cash.

This is the second significant seizure of currency at Cornwall in 2 months.  According to Seaway News, on March 31, 2016, the Cornwall Regional Task Force seized $USD 200,000 from a person trying to cross the St. Lawrence River in a vessel. The Cornwall Regional Task Force is a joint forces partnership that includes the Royal Canadian Mounted Police, Ontario Provincial Police, Canada Border Services Agency, and the Ontario Ministry of Finance.

Pursuant to subsection 18(1) of the Proceeds of Crime Act, if an officer believes on reasonable grounds that subsection 12(1) of the Proceeds of Crime Act has been contravened, the officer may seize as forfeit the currency or monetary instruments.  Subsection 12(1) of the Proceeds of Crime Act requires that every person or entity referred to in subsection (3) report to an officer the importation or exportation of currency or monetary instruments of a value equal to or greater than $CDN 10,000.

There are many cases relating to seized money under section 18 of the Proceeds of Crime Act. Most of the cases support the CBSA’s seizure of currency where it cannot be adequately demonstrated that the currency or monetary instruments come from legitimate sources (e.g., a bank account that has money from legitimate sources, such as salary).  As a general rule, the CBSA presumes that money that had not been properly reported is from illegitimate sources.  During the interview, a traveler can provide evidence that the currency or monetary instruments comes from a legitimate source.

The traveler also is entitled to appeal the seizure and bring forward new evidence that the currency or monetary instruments is from legitimate sources.  Where many travelers go wrong, however, is that they expect the CBSA officer or Recourse Directorate to merely take their words as evidence.  Well, the CBSA and the Recourse Directorate need a good trail of evidence that the currency is from a legitimate source.  The CBSA and the Recourse Directorate are not particularly helpful in providing advice on what evidence will satisfy them because they do not wish for evidence to manufactured.  Good evidence (such as bank statements and pay stubs) would exist.

There are cases where an individual indicates they received the currency from another individual (such as a parent, relative or friend).  In these cases, it is necessary to show that the other individual has legitimate sources for that currency.

It is important to note that it is legal to import currency over $CDN 10,000 into Canada and to export currency over $CDN 10,000 outside Canada.  However, the traveler must report the import/export in the correct manner.  For example, at the time of am importation, the traveler must complete the E311 Declaration Card and check the box “Yes” next to the question “currency and/or monetary instruments totaling CAN$10,000 or more” or inform the primary CBSA officer at the border crossing.

If the CBSA has seized currency or monetary instruments and you require assistance in understanding the rules to get the currency and/or monetary instruments back, please contact Cyndee Todgham Cherniak at Cyndee@LexSage.com or 416-307-4168.