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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

#81

Post by denton-scratch »

jszymborski wrote: post #66
mikeyouse wrote: post #58

Earlier quoted context omitted.

"The government asked for their cut" actually means that for laundering that $881 million in cartel money - they were fined $1.9 billion and then had to pay an additional $665 million in other civil penalties. They wouldn't do it again and again because they don't earn $880 million when accepting $880 million in dirty money - remember that bank deposits are liabilities to the bank - they only earn money from interest…

Also, HSBC is selling off all of its consumer banking in Canada largely as a result of the gov't fines and tattered reputation among Canadians.

> tattered reputation among Canadians

Hardly just Canadians; I first started hearing tales of huge HSBC corruption 20 years ago.

FTR: I bank with First Direct, which is an online banking service of HSBC in the UK.

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

#82

Post by user3939382 »

mikeyouse wrote: post #58
user3939382 wrote: post #43

HSBC funneled $1B (that we know about) for cartels, it came out as 100% knowingly committed, and no one went to jail. Basically the government asked for their cut. Why wouldn't do they this again and again? They are above the law, they are the law.

"The government asked for their cut" actually means that for laundering that $881 million in cartel money - they were fined $1.9 billion and then had to pay an additional $665 million in other civil penalties. They wouldn't do it again and again because they don't earn $880 million when accepting $880 million in dirty money - remember that bank deposits are liabilities to the bank - they only earn money from interest…

I'd be very surprised if the $880M was the extent of the crime. The government not jailing anyone involved in the scheme is completely inexcusable and in my view makes the government complicit in the crime, in which case my trust that the public information about this case is accurate is 0.

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

#83

Post by seanmcdirmid »

ericmcer wrote: post #78
alchemist1e9 wrote: post #36

Earlier quoted context omitted.

Blaming foreign investors for a housing crisis is a smokescreen. It's not the demand from investors that's the issue; it's the government's stifling regulations that choke new construction. The mess is because of state failure, not market failure. When sellers freely sell their homes to foreign buyers, they're making choices that benefit them. Why should we deny them that right? The real absurdity is ignoring the ele…

USA population has increased ~10% in the last 20 years. Why has that small increase in population caused a humongous lack of housing? It feels like something else is going on other than "we need to increase supply by 10% but can't"

Housing supply and demand isn’t uniformly distributed across the United States. When we say “housing shortage” we only mean in popular places to live.

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

#84

Post by inglor_cz »

stormfather wrote: post #15
alchemist1e9 wrote: post #9

Earlier quoted context omitted.

Why? Should we restrict other investments with similar logic? For example should non-residents not be allowed to purchase vacation properties and lease them? The impulse to enlist the government to regulate private property and investments is not productive and results in endless encroachment of individual liberties and rights to governments.

Something drastic has to be done about the cost of housing if we're to leave a functional society to the next generation.

"Something drastic has to be done about the cost of housing if we're to leave a functional society to the next generation."

Drastic? Well, then: kill NIMBYism. Just off with its head. We know the 18th century in England as the "Gin Craze", future generations will look at our period as the "NIMBY Craze".

Large-scale construction is absolutely possible. There were periods of massive construction booms all around the globe, especially after wars (when a lot of housing had to be rebuilt immediately). You can absolutely build a lot of comfortable middle-class housing in a fairly short time. Most German cities were rubble in 1945 and fine again in 1960.

But you need density and straightforward approval processes. No artificial scarcity caused by one-family home zoning and endless environmental reviews that are abused to stall developments for decades.

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

#85

Post by IncreasePosts »

alchemist1e9 wrote: post #49
tslocum wrote: post #30

Earlier quoted context omitted.

Yes. Restricting foreigners from owning domestic assets is the beginning. Next comes restricting / heavily taxing domestic owners that own more than one home. Sooner or later, housing gets closer to being what it's supposed to be (shelter and space for people who need it) rather than a financial vehicle.

This proposal is a slippery slope to economic disaster. First, restricting ownership rights—foreign or domestic—distorts the market, disincentivizes investment, and ultimately harms those it claims to help by reducing the supply of housing. Second, treating homes purely as shelter ignores the reality that property is also an investment and a key component of individual wealth and economic freedom. Imposing heavy taxe…

How about an ultimatum? Either people can only own one house without huge tax consequences, OR we open up restrictions on building so we can build a lot more housing stock than we currently do.

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

#86

Post by ABCLAW »

beiller wrote: post #62

All sounds very plausible, but where are the effects of this? We should be seeing many people holding mortgages at HSBC not able to pay. Are there no public stats showing how many lack of payments being made to HSBC? Is HSBC going to hold on to these properties taking massive losses? For how long? It has definitely helped the run up of prices here. It will also help the collapse of prices as well, either that or the…

> We should be seeing many people holding mortgages at HSBC not able to pay.

Not really. Lying about the source of cashflow doesn't mean the cashflow isn't real.

The end objective for a lot of these frauds isn't to sink the bank with fake loans. It's to launder money.

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

#87

Post by faluzure »

beiller wrote: post #62

All sounds very plausible, but where are the effects of this? We should be seeing many people holding mortgages at HSBC not able to pay. Are there no public stats showing how many lack of payments being made to HSBC? Is HSBC going to hold on to these properties taking massive losses? For how long? It has definitely helped the run up of prices here. It will also help the collapse of prices as well, either that or the…

Assuming these mortgages are insured through CMHC, would HSBC be on the hook or the insurance system when some of these mortgages fail?

Canadians are certainly paying for social services used by folks who earn income abroad and pay little to no income tax in Canada, and folks who want to buy their first house are harmed by inflated housing prices.

My currently overseas landlord for some reason needed to travel to Canada to give birth, and was very eager to get their health card / banking documents sent to our rental despite it being rented out for several years prior to us arriving...

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

#88

Post by godelski »

mikeyouse wrote: post #58
user3939382 wrote: post #43

HSBC funneled $1B (that we know about) for cartels, it came out as 100% knowingly committed, and no one went to jail. Basically the government asked for their cut. Why wouldn't do they this again and again? They are above the law, they are the law.

"The government asked for their cut" actually means that for laundering that $881 million in cartel money - they were fined $1.9 billion and then had to pay an additional $665 million in other civil penalties. They wouldn't do it again and again because they don't earn $880 million when accepting $880 million in dirty money - remember that bank deposits are liabilities to the bank - they only earn money from interest…

That comes out of the company's wallet, but does it come out of a person's? Persons responsible for committing crimes, not customers or other third party members. HSBC has trillions in holding, so those numbers might not be as big as they appear.

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

#90

Post by crustaceansoup »

faluzure wrote: post #87
beiller wrote: post #62

All sounds very plausible, but where are the effects of this? We should be seeing many people holding mortgages at HSBC not able to pay. Are there no public stats showing how many lack of payments being made to HSBC? Is HSBC going to hold on to these properties taking massive losses? For how long? It has definitely helped the run up of prices here. It will also help the collapse of prices as well, either that or the…

Assuming these mortgages are insured through CMHC, would HSBC be on the hook or the insurance system when some of these mortgages fail? Canadians are certainly paying for social services used by folks who earn income abroad and pay little to no income tax in Canada, and folks who want to buy their first house are harmed by inflated housing prices. My currently overseas landlord for some reason needed to travel to Can…

CMHC doesn't insure mortgages where the property value is equal to greater than $1 million, which in the Greater Toronto Area essentially limits it to condo purchases.
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