Reaction has been swift from the B.C. government and the public after a Globe and Mail investigation revealed shady lenders connected to the drug trade are effectively cleaning their cash through Vancouver-area real estate, by issuing millions of dollars in mortages and loans to newcomers from China.

The province's attorney-general indicated he is particularly alarmed because some of the locally-based private lenders are linked to the sale of fentanyl, imported from China, which caused more than 1100 overdose deaths in B.C. last year.

"The nature of these allegations, that this money-laundering activity is actively influencing our real estate market and is connected to the sale of life-destroying fentanyl, underline the critical importance of addressing money laundering urgently and not ignoring it," said David Eby, in a statement issued just hours after the story was published Friday.

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The Globe's investigation discovered 17 local residents, most associated with drug-related crime, are effectively parking their riches in Vancouver-area real estate without actually owning any of the properties. Those private lenders issue mortgages and short term loans — just like banks, except in cash — and have collectively staked a $47-million claim in 45 properties in recent years.

Three of the lenders were caught carrying more than $600,000 in fentanyl-laced cash in 2016. They have collectively registered more than $20-million in mortgages and other debts against multi-million dollar homes in recent years. Several other lenders have also been connected to drug trafficking.

Their target customers are wealthy newcomers from China, who own property in B.C., but who are looking for extra cash. The borrowers often have money overseas, but are unable to transfer it to Canada, because China doesn't allow its citizens to take more than U.S.$50,000 per year abroad.

The $47-million identified by The Globe is just a fraction of this type of private lending, because only the debts in dispute or default generate a paper trail in the courts.

Mr. Eby called the revelations "deeply troubling." He pledged to use The Globe's data to broaden the scope of an ongoing independent investigation into money laundering in B.C. casinos. The investigator, Peter German, is a former commissioner of the RCMP, and is set to deliver his report next month.

"As part of his review, German is to explore what connection, if any, the issue has with other sectors of B.C.'s economy," said Mr. Eby. "Our government will work to determine the scope of this issue, and what must be done to appropriately address it. We will ensure our investigation into money laundering in B.C. casinos is informed by these disturbing revelations."

The B.C. government is under intense pressure to do much more than make promises. Several activist groups pushing for more affordable housing are holding a rally Sunday in downtown Vancouver. One of the groups speaking at the rally says they will urge the government to put a stop to any schemes unduly influencing the real estate market, particularly with money earned from selling fentanyl and other crimes.

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"Those who let British Columbians die to protect home equity in a crime-ridden housing market are willing accomplices to these crimes," said Raza Mirza, from Housing Action for Local Taxpayers.

Meanwhile, the federal government is pledging to make it harder for lawyers to facilitate private lending by shady operators. The transactions The Globe uncovered would not be possible, if it weren't for the solicitors who register mortgages and file court claims on the lenders' behalf.

Lawyers don't have to report suspicious transactions to FinTRAC, the federal agency that monitors money laundering, because the Federation of Law Societies of Canada fought that requirement in the Supreme Court of Canada and won. The lawyers had argued that reporting on their clients would violate a solicitor's obligation to keep matters confidential.

A spokesperson for the federal finance ministry said Ottawa is consulting with provincial law societies, with an aim to bringing in a new law to essentially override that ruling.

"A recent risk assessment carried out by the Government of Canada found that the legal sector poses a high risk of money laundering," said spokesman Jack Aubry. "It is the Department of Finance's intention develop constitutionally compliant legislative and regulatory provisions that would subject legal counsel and legal firms to the [anti-money laundering regime]."

The federal government has been talking about doing that for at least two years, however. Mr. Mirza echoed the sentiments of many Canadians The Globe is hearing from, in calling for more action and less talk.

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"Vancouverites and British Columbians have had enough," he said. "We will no longer stand by as governments stall and do nothing in the face of this unending crisis. We will stand up, we will be heard, and we will force the government to crack down and fix this mess."