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HomeBusinessExclusive: Is Richmond birth tourism a magnet for dirty money?

Exclusive: Is Richmond birth tourism a magnet for dirty money?

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Bob Mackin (Updated June 27) 

British Columbia’s NDP government says money laundering has happened at colleges.

Peter German’s second Dirty Money report included an anecdote about a student who brought $9,000 in cash in a duffel bag to pay a $150 charge to a college cashier. The rest was deposited in an account. “In effect, the institution was being asked to act as a bank,” German wrote.

What about a hospital popular with foreign mothers?

Richmond Hospital (Mackin)

Richmond Hospital is ground zero for birth tourism in Canada, drawing mothers from China who want their daughters and sons to be born Canadian citizens. Sources tell theBreaker.news that it is not uncommon for maternity ward bills to be paid with cash.

Vancouver Coastal Health said $737,000 of the $6.2 million it invoiced non-residents for maternity services from April 1, 2018 to May 2, 2019 was paid in cash.

Richmond Hospital charges non-residents a $10,000 per diem for normal vaginal delivery and $15,000 for a c-section. The standard daily ward charge for a mother is $3,675.

From April 2018 to February 2019, there were 389 babies born to foreign mothers at Richmond Hospital. During the previous fiscal year, there were 474 — more than 22% of all births to non-resident mothers, almost entirely from China. VCH figures released to theBreaker.news under the freedom of information laws show that Richmond Hospital collected $31,690 in cash for May 21-23, of which $29,565 was maternity related. Four of the transactions were between $6,215 and $8,000. The only substantial cash transaction for the period that was not maternity-related was $1,040 on May 21 for non-resident inpatient.

The Attorney General’s ministry said the government encourages any institution that handles large cash transactions to review its policies with a view to closing opportunities for money laundering. 

“If the hospital costs of the birth are less than the initial deposit, a refund of the outstanding balance is given. For example, if the deposit is $15,000 and the birth costs $12,500, the payee would receive a refund of $2,500,” said the ministry response to theBreaker.news. “However, instances of refunds in these cases are rare and only occur in eight percent of transactions.”

VCH policy states that any money owing on a deposit for maternity services that is paid in cash will be refunded in cash. Last year, that amounted to $17,000 for services not received by patients.

VCH said it recovered 82% of the total maternity costs from non-resident parents, leaving a whopping $1.16 million owing.

“We are continuing to work to recover the remaining amounts,” said VCH spokeswoman Tiffany Akins. “Non-residents are required to make a pre-payment deposit of $10,000 for a vaginal birth and $15,000 for a caesarean birth.”

Health Minister Adrian Dix (Hansard)

In 2018, VCH sued Chinese birth tourist Yan Xia for not paying a $312,595 bill in October 2012. Because of interest, the bill would now be more than $1.2 million.

Last November, the federal Liberal government responded to Richmond activist Kerry Starchuk’s e-petition against birth tourism that drew support from 10,882 citizens. The government said it would not ban birth tourism, but would take steps to protect the public from immigration fraud by undertaking a comprehensive review.

“Applicants must always be honest about the purpose of their visit. Providing false information or documents when dealing with Immigration, Refugees and Citizenship Canada or Canada Border Services Agency is considered misrepresentation and has significant consequences,” said the official federal response.

In 2016, B.C. government documents indicated the Ministry of Health knew of 26 so-called black market “baby houses” in the Lower Mainland, where foreign mothers pay thousands of dollars to stay before and after giving birth. One such house was next door to Starchuk. 

“If the federal government wants to take steps with this, they’re the agency that has responsibility,” said NDP health minister Adrian Dix in a January interview. “As a provincial government we have to consider that people who present at our hospital that don’t have Canadian healthcare insurance pay the appropriate costs. In the case of births, that they do pay the appropriate costs up front.

“I, in no way endorse it or support the marketing of birth tourism, but we should be clear, matters related to immigration lie with the federal government.”

In January, U.S. authorities indicted 19 people related to a busted 2015 California birth tourism scheme. Investigators found birth tourism companies charged mothers from China between $40,000 and $100,000 each.

“The birth tourism operations not only committed widespread immigration fraud and engaged in international money laundering, they also defrauded property owners when leasing the apartments and houses used in their birth tourism schemes,” said the Department of Justice news release

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