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Ukraine honourary consul should have seen money laundering 'red flags'

The lawyer was found to have committed three instances of professional misconduct.
house real esatate
A Vancouver lawyer serving as honourary consul for Ukraine in B.C. committed professional misconduct, the law society said.

A Vancouver lawyer who serves as honourary consul for Ukraine in B.C. committed professional misconduct related to 15 real estate deals referred to him by a convicted drug trafficker, the Law Society of BC has found.

A society hearing panel chaired by Jamie Maclaren said Lubomir (Mir) Ihor Huculak failed to make reasonable inquiries about the legitimacy of the deals.

In the Aug. 5 decision, Maclaren said the deals "were replete with objectively suspicious red flags" for money laundering.

The society said he committed three instances of professional misconduct.

The society conducted a compliance audit of Huculak's practice in July 2016, the results of which raised concerns about his fulfilment of his client identification and verification obligations.

An investigation was opened into the 15 deals and found Huculak acted on the instructions of his acquaintance and former client, MK, “who he knew had been convicted of conspiracy to traffic cocaine in the United States in 2009.”

The decision further said that in several of the transactions, Huculak acted for EA, on referral from MK. The decision said in media reports of MK’s conviction, EA was identified as the leader of the “EA Drug Trafficking Organization.”

The decision said the same media reports alleged that the trafficking organization was tied to money laundering and was based out of Vancouver.

The newspaper articles were published prior to the transactions and they would have been available to (Huculak) by way of a simple online search of MK’s name or EA’s name, the decision said.

The decision said several transaction records listed deposits being paid directly by the purchaser to the seller, but lacked proof or verification of the deposits actually being paid.

Many of the transactions proceeded with very quick closing dates after MK’s initial instructions to Huculak, the document stated.

“Nearly all of the transactions involved high-ratio mortgages with very low commissions. The law society submits that all of these circumstances were objectively suspicious and were either overlooked or ignored by (Huculak) as ‘red flags’ signalling clear fraud and money laundering risks,” Maclaren said.

Maclaren’s reasons said the society alleged the circumstances surrounding MK, EA and the transactions were suspicious. The reasons said Huculak ought to have ensured he was not assisting in any dishonesty, crime or fraud in facilitating the transactions.

“The law society argued that by failing to investigate the possibility of money laundering and other criminal ends, (Huculak) gave the transactions a veneer of legitimacy that they may not have merited,” Maclaren wrote.

jhainsworth@glaciermedia.ca

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