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"Fake Chinese income" mortgages fuel Toronto real estate bubble: HSBC bank leaks

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Re: "Fake Chinese income" mortgages fuel Toronto real estate bubble: HSBC bank leaks

#301

Post by robocat »

xcrunner529 wrote: post #245
robocat wrote: post #239

Earlier quoted context omitted.

> I’m not seeing the problem. The problem is what is the incentive to keep working once you've earned a house and bach? Why bother save for retirement if your savings are to be taken from you at a significant percentage per year? A few percent is a huge penalty (see index funds versus mutual funds), and the wealth tax is on top of taxation of salary and dividends. assets over $1m - a threshold the party thought would…

lol what? That’s the same old tax argument over again. I thought you all were motivated by things other than money? You know, that entrepreneurial spirit? The incentive is it’s still a fuckton more money. You’re not taxed at 100% and in turn you live in a country with better services. The amount of money wasted by the rich is hilarious when combined with this take.

> The amount of money wasted by the rich is hilarious

You're repeating bullshit - The majority of spending in New Zealand is not by the wealthy but by the rest of the majority of kiwis[1].

If people earning less than $100k waste 5% of their income, and people earning more than $300k waste 50% of their income, then the people earning less than $100k are wasting more.

We're not in the USA with Jeff Bezos, so your point just makes no sense.

The majority of earners I know blow more than single digit percentages on unnecessary crap and luxury. For example my working class friends that spend more than 10% per week on booze and drugs - plenty of people spending more than $150 with a weekly income Look around you and there are obviously not a lot of superyacht stores. Plenty of booze shops doing a roaring trade and it isn't the $300k+ earners in them.

The wealthy people I know invest. If those investments are bringing foreign income into New Zealand, we already tax that and all New Zealanders win!

The government needs to get rid of the bad property investment incentives - those are where the wealthy are fucking over the non-wealthy. We have enough land and resources in New Zealand for everyone to have their own home.

Don't discourage people from investing in things that make New Zealand better off. Our taxation system discourages founding internationally competitive businesses, and it discourages owning more than $50k in overseas shares. And the majority of New Zealanders don't give a shit because the majority don't begin such businesses and they are ignorant about where their income to buy imports ultimately comes from.

Negative incentives matter, probably more than positive incentives. We all want to slowly tax the well off until they leave or until they are no longer well off.

[1] Data based on: https://www.ird.govt.nz/about-us/tax-statistics/revenue-refu...

Re: "Fake Chinese income" mortgages fuel Toronto real estate bubble: HSBC bank leaks

#302

Post by bonestamp2 »

Rehanzo wrote: post #292
bonestamp2 wrote: post #221

Earlier quoted context omitted.

Don't get me wrong, it's definitely a problem, and something needs to be done, but lets also try to keep it in perspective... $500 million could well be 500 mortgages in Toronto. That would be about 0.02% of the private dwellings in Toronto.

It says "at least". It's also looking at specific branches of one single bank. Who knows the true extent if all banks and branches are considered.

Ya, fair enough, and some Toronto mortgages are more than a million too.

Re: "Fake Chinese income" mortgages fuel Toronto real estate bubble: HSBC bank leaks

#303

Post by pxmpxm »

rconti wrote: post #300
radicaldreamer wrote: post #128

Earlier quoted context omitted.

Are US banks just a lot more strict about source of income than Canadian banks?

TFA says: "The official noted that other nations require tax agencies to verify incomes for mortgages, which isn’t the case in Canada." I don't know if it's a legal requirement, but I sure know I had to hand over all of _our_tax information to the bank to validate income when getting a mortgage in the US. You have to sign a form saying the bank is allowed to pul your data from the IRS; you're not just handing over pa…

This - not sure where the sentiment in this thread is coming from, but you have to disclose your tax filings for the last 2/3 years along with all your bank accounts and recent statements.

Re: "Fake Chinese income" mortgages fuel Toronto real estate bubble: HSBC bank leaks

#304

Post by quink »

robocat wrote: post #239
quink wrote: post #191

Earlier quoted context omitted.

Guardian, December 2023: > The wealth tax contemplated by New Zealand Labour would have required couples to pay an annual levy of 1.5% on any assets they held over a $10m threshold. The estimated $3.8bn in revenue would have funded income-tax cuts for the vast majority of Kiwis. Labour’s potential coalition partners, the Greens and the indigenous-led Te Pāti Māori, ran on similar platforms. > Plus the relentless atta…

> I’m not seeing the problem. The problem is what is the incentive to keep working once you've earned a house and bach? Why bother save for retirement if your savings are to be taken from you at a significant percentage per year? A few percent is a huge penalty (see index funds versus mutual funds), and the wealth tax is on top of taxation of salary and dividends. assets over $1m - a threshold the party thought would…

> Help I’m being oppressed by needing to pay some tax on assets.

That sounds like a terrible thing the government is doing to you.

> No, not the government.

That sounds like a terrible thing the opposition might do to you.

> No, not the opposition.

OK… did you at least accurately describe what was happening originally?

> Well, there’s these asterisks. But I am oppressed.

Re: "Fake Chinese income" mortgages fuel Toronto real estate bubble: HSBC bank leaks

#305

Post by cyanydeez »

ThisIsMyAltAcct wrote: post #25

> The whistleblower, whom The Bureau is calling D.M., immigrated to Canada as an international student from India, making him a minority among mostly Chinese-Canadian co-workers at the Aurora branch. > “I am going to reveal potential mortgage fraud at HSBC Bank Canada and possibly some employees benefited from the fraud, financially pocketing thousands of dollars, which I call the proceeds of crime.” > FINTRAC’s stud…

upstream, the problem is _still_ the commoditization of housing markets.

it's not like they're claiming these people are unable to pay.

Re: "Fake Chinese income" mortgages fuel Toronto real estate bubble: HSBC bank leaks

#306

Post by cyanydeez »

simmerup wrote: post #299
bonestamp2 wrote: post #221

Earlier quoted context omitted.

Don't get me wrong, it's definitely a problem, and something needs to be done, but lets also try to keep it in perspective... $500 million could well be 500 mortgages in Toronto. That would be about 0.02% of the private dwellings in Toronto.

Remember this is $500 million awarded to people out competing honest Canadians looking for housing who aren't lying about their incomes. If 10 people bid for a house, it's the guy in China lying about their income setting the house price when they win, by what HSBC is doing. This will have an outsized effect on the market.

yes, remember it's capitalism doing this, not Chinese, Indian, Canadian or American.

hail free market.

Re: "Fake Chinese income" mortgages fuel Toronto real estate bubble: HSBC bank leaks

#307

Post by robocat »

xcrunner529 wrote: post #273
robocat wrote: post #265

Earlier quoted context omitted.

The whole point of a business is to make a profit: I worked hard because I am middle aged and had no retirement savings - my other choice was FIRE or to suck on the government's teat. Running a "business" for status is defined as a hobby. 1 in 10 businesses survive. Why bother starting one if you don't get your 10x return? If you've got one, why bother trying to be a serial entrepreneur if it's all gonna be taxed? Do…

Because your business doesn’t just start earning 20m and that’s still only 150000. Are you arguing against fake numbers?

> fake numbers

no: - I'm using the numbers in the quote in my comment, and from the link I gave you.

Taxation rules create incentives and disincentives. If you earn a salary you are usually ignorant of those incentives because you don't experience them. From what I see the attitude is "fuck everyone who is better off than me".

Our rules need to encourage people to make NZ better off. Not have the incentive to stop once you have gotten a $20m home: https://www.trademe.co.nz/a/property/residential/lifestyle-p...

Anyone that owns businesses worth $20m is already taxed on income. Giving a big middle finger to people that build businesses is silly.

Disclosure: I am not anywhere near the big salary or wealth numbers we've mentioned.

Re: "Fake Chinese income" mortgages fuel Toronto real estate bubble: HSBC bank leaks

#308

Post by cbsmith »

faeriechangling wrote: post #252
cbsmith wrote: post #171

Earlier quoted context omitted.

> The whole country is a gigantic house of cards propped up by real estate, with horrible service quality, terrible healthcare, no jobs, ZERO innovation, risk taking and entrepreneurship. Canada has generally had a more conservative financial industry, which is a large part of why they were able to escape the 2008 mortgage crisis, and that, in turn, has lead to a stronger real estate market. Additionally, the recent…

I think the conservatism of Canada is overstated and in fact Canada is one of the most leveraged countries in the world.

The "conservatism" is of the banks, not the country. The Canadian government is quite leveraged.

But as leveraged as Canada is, Canada is well below the average for debt-to-GDP ratio of the G7 (admittedly skewed by Japan's monster debt, but still well below US debt). https://www.visualcapitalist.com/government-debt-by-country-...

Re: "Fake Chinese income" mortgages fuel Toronto real estate bubble: HSBC bank leaks

#309

Post by throwaway907628 »

topspin wrote: post #186
ThisIsMyAltAcct wrote: post #25

> The whistleblower, whom The Bureau is calling D.M., immigrated to Canada as an international student from India, making him a minority among mostly Chinese-Canadian co-workers at the Aurora branch. > “I am going to reveal potential mortgage fraud at HSBC Bank Canada and possibly some employees benefited from the fraud, financially pocketing thousands of dollars, which I call the proceeds of crime.” > FINTRAC’s stud…

> Sounds like that branch is compromised "Since 2015, the whistleblower concluded, more than 10 Toronto-area HSBC branches had issued at least $500-million" It's not a branch. It's the whole bank. And you can safely infer it's not the only bank.

Witnessed this first hand at RBC when my brother from Hong Kong was inquiring about getting a mortgage in Toronto since he wants to move back to Canada with his two young kids.

We found a random mortgage specialist (a Chinese lady) at RBC. Without knowing the full picture of my brother's income situation, she immediately suggested that she could get the mortgage approved regardless, just needed to fake some documents.

It was astonishing how she went straight to the point so quickly to someone she met the first time.

She also said a lot of people has non-taxed income and needed a way to get a mortgage before the real estate price becomes out of reach.

So definitely not just HSBC.

Re: "Fake Chinese income" mortgages fuel Toronto real estate bubble: HSBC bank leaks

#310

Post by techbro92 »

cyanydeez wrote: post #306
simmerup wrote: post #299

Earlier quoted context omitted.

Remember this is $500 million awarded to people out competing honest Canadians looking for housing who aren't lying about their incomes. If 10 people bid for a house, it's the guy in China lying about their income setting the house price when they win, by what HSBC is doing. This will have an outsized effect on the market.

yes, remember it's capitalism doing this, not Chinese, Indian, Canadian or American. hail free market.

This is not an inherent feature of capitalism. This is a failure of the government to create a fair market. This is caused by people that are subverting the rules to out compete the people playing by the rules.
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