44th Parl. 1st Sess.
October 19, 2022 02:00PM
moved that Bill C-289, An Act to amend the Criminal Code (identity verification), be read the second time and referred to a committee.
He said: Madam Speaker, it is a pleasure to stand here this evening with my fellow colleagues to talk about a very important issue, which is money laundering, and to discuss a simple private member's bill to amend the Criminal Code to make it easier for authorities to prosecute and convict money launderers.
This bill is a simple addition, an amendment to the Criminal Code, to make it a criminal offence to provide false or misleading statements to a reporting entity about the identity of the account holder or the corporate structure and beneficial ownership of the ultimate account holder. Money launderers often lie about their identity or the ownership structure of the account holder. It is a simple lie that has significant impacts on Canada. This is because money laundering can impact every community across Canada.
The bill comes with penalties of up to 10 years in jail, a $1-million fine or both. It should no longer be free to wash money in Canada. These crimes, these simple lies, deserve significant consequences. The secret is that Canada has a far lower rate of prosecution and conviction for white collar and financial crimes when compared to other like countries across the world.
The Cullen commission, which was a British Columbia inquiry into money laundering, recently released its report in May of this year. It details significant concerns with and gaps in money laundering laws and has exposed the significant challenges Canadian authorities, our police and prosecutors, have in convicting money launderers. The commission heard stories of people going into casinos with hockey bags full of $20 bills as dirty money, and that money coming out washed and clean. This must stop.
These are the proceeds of crime in our communities. These are the proceeds of drug trafficking for substances such as fentanyl. They are the proceeds of human trafficking and of political corruption. When we look at what is happening across the globe from a geopolitical perspective, Russia's illegal war and invasion of Ukraine, and the political corruption and kleptocracy that goes on in some regimes, we know some of that money ends up here in Canada.
What we want to do, and what this bill proposes, is to make it easier for authorities to convict money launderers of this crime. We care about money laundering, of course, because it enables crime. We also care about it because it is expected that about $100 billion every year ends up being laundered in Canada, and much of it ends up in our real estate all across the country, which increases the demand for housing. When we increase the demand for something, we also increase the price.
Of course, the significant rise in housing prices is not related solely to money laundering. That is not what I am claiming here tonight, but it certainly does not help the situation. This increased real estate activity and demand for real estate in our major urban centres spills over into some smaller communities. As people are pushed out of major urban cores, they end up in beautiful rural parts of this country, just like Simcoe North.
In fact, the Bank of Montreal earlier this year singled out Orillia, which is in Simcoe North, as having a 300% increase in real estate prices for the average home over six years. That is a very difficult price increase to manage for local residents. It has been a challenge for renters and those trying to find housing in cities such as Orillia all across this country.
Our country has become a playground for global criminals to wash their dirty cash. Canada is even being promoted by criminals around the world as a safe haven for the proceeds of crime. That puts Canada on the map for all of the wrong reasons. The rest of the world has introduced some more stringent and stricter laws than Canada when it comes to money laundering, and that is why criminals are finding their way to Canada.
As the holes in the dike get plugged across the rest of the world, criminals will move their money to the jurisdictions with the weaker laws. Unfortunately, right now that happens to be Canada. At one point, we actually did lead the world with some laws pertaining to financial crimes, but we have unfortunately fallen behind, which means it puts us on the map for these criminals as a safe place to come and wash their money.
What can we do? These are complex, transnational organizations with links to organized crimes and corrupt political regimes. How do we make sure that they cannot use our lax systems to launder their money?
In a recent C.D. Howe intelligence memo, expert Kevin Comeau acknowledged the challenge with Canada's current laws. He wrote, “Under our present anti-money-laundering rules, financial institutions and designated non-financial businesses...are legally required to collect and verify the identity information of their clients.” Clients who provide false beneficial ownership information are often not caught when they lie about these representations. He also says, “The federal government can reduce these risks by enacting legislation attaching sanctions to false reports of beneficial ownership”. We need to give authorities the tools to make it easier to catch these criminals.
As a rookie MP, I wanted to bring forward an idea that I thought might have cross-partisan support. Money laundering, I am sure, will not have many people stand up in this House and advocate that we need to keep our laws weak. Money laundering affects us all. It is not a partisan issue, but it is one that we can all work together on.
The government, to its credit, has signalled progress on money laundering. It has actually moved up its commitment to introduce a beneficial ownership registry. That is very important. The original date was 2025. It moved that up and it is supposed to be enacted by the end of this year.
I must say that this beneficial ownership legislation is very important, but I am underlining that the beneficial ownership registry must be publicly available and it must be free of charge. It does not appear that this will initially be the case, but I hope that the government can keep this commitment. As many people in the House know and say, sunlight is, in fact, the best disinfectant.
This private member's bill, Bill C-289, is proposed to be complementary to beneficial ownership legislation, but it also stands alone. If, for some reason, the beneficial ownership legislation is delayed, or, for whatever reason, it is not brought forward and enacted this year, this private member's bill will be another tool for authorities to use to combat money laundering activity.
Additionally, penalties for lying about beneficial ownership or identity and money laundering activity should be met with criminal and not administrative penalties. We need criminal penalties for people who lie about the ownership structures of their accounts because of the harm that it does to society. These penalties must have teeth. Weak punishments will only be seen as a cost of doing business. That is how these money launderers, these sophisticated criminals, view weak punishments.
Do not take my work for it. Here are some thoughts of well-known stakeholders. Christian Leuprecht of the Macdonald Laurier Institute, a senior fellow, says, “After decades of turning a blind-eye, the proposed amendment to the Criminal Code is one of many steps Canada needs to show that it is actually serious about containing global financial crime.” James Cohen at Transparency International Canada says, “We are pleased to see the proposal of this bill that fits in with increasing attention and efforts in Canada to fight money laundering...a crucial tool in closing one of the many gaps that have been exploited by kleptocrats, tax cheats and their enablers.” Other supporters of this bill who have come forward include Publish What You Pay and Canadians for Tax Fairness.
I commit to working with members of all parties in the House on this bill. I am hoping to hear their constructive feedback. I do not quite care who gets the credit if we make significant progress affecting money launderers. I want to work with members of the House and the Senate to close other loopholes that money launderers rely on.
Some of the ideas that I plan to advance in the House also include a national commission on money laundering. I think it is important to follow the B.C. commission and bring forward a time-limited study with some concrete measures that the government can enact quickly in order to combat money laundering. There was enough evidence presented in the Cullen commission in B.C. that should give all of our legislators here in the House some cause for concern, and we must turn our mind to that on the national stage.
Additionally, the U.K. has brought in something called unexplained wealth orders, which I believe we should be considering here in the House. It would allow authorities to recover the proceeds of crime and identify assets that are purchased by criminals.
As well, there is a very simple change we could make to the Privacy Act where financial institutions could share information between themselves and the RCMP so that individuals who are identified as laundering large sums of cash cannot just walk across the street to another financial institution and continue their activity. These institutions often have significant data and intelligence on individuals or organizations who launder money. We need to make it easier for the institutions to speak to each other so that these criminals have a harder time getting access to financial products and accounts that allow them to launder their money.
In the few minutes left, I would like to thank some people.
I thank the parliamentary drafters. I think I scared them initially with some of my ideas, but we narrowed it very well. Ms. Lemaire did a fantastic job working with me and had a lot of patience with me as a rookie MP about the ideas, and I believe we landed at a great spot, an elegant spot.
I thank James Cohen from Transparency International Canada and Sasha Caldera from Publish What You Pay Canada. These individuals were with me at the very beginning talking about some ideas that we could bring forward to close money-laundering loopholes.
I thank Troy Cochrane from Canadians For Tax Fairness. Sam Cooper has been a relentless advocate on the money-laundering file for years. He was talking and writing about money laundering and uncovering financial crime. He is still doing that. He has written a book called Wilful Blindness, which I think all members of the House should consult. It gives us a small lens into a very dark world of money laundering.
I thank the Macdonald–Laurier Institute, which I mentioned earlier, as well as Kevin Comeau and others at the C.D. Howe Institute, Christian Leuprecht, whom I mentioned, Garry Clement, Jason Wadden, Tim Hyde, senators from all parties, frankly, and finally, my former director of parliamentary affairs, Ryan Ouderkirk, who is no longer in my office but left to pursue a legal education at my alma mater, Western University. He will make a fantastic lawyer. His help was instrumental in getting us to this place today. I want to thank him very much.
I thank the hon. member for Abbotsford for seconding this bill and speaking with me at length about it. I very much appreciate the veteran parliamentarian for imparting some wisdom to a rookie, and not just for his help on this bill but in general. I have been very lucky to have him as a mentor.
I will close by saying that I look forward to constructive feedback on this bill and a commitment from all members in the House to take a simple yet necessary step to close a loophole to combat money laundering. Today is the day when we can say no to global criminals who see Canada as a safe haven to launder their dirty cash.
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Madam Speaker, I appreciate the manner in which the member has presented the legislation and his willingness to be open.
No doubt, we as a society have to come to grips with the issues of our money supply, the laundering that does take place, and to a fairly wide spectrum of issues in between. We also need to recognize that it is very much a global issue. The member made reference to that in the last few words of his speech. It is important that, as a nation, we work together with other like-minded nations to deal with the issue of money laundering. I wonder if the member could provide more insight on that specific issue.
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Madam Speaker, the hon. member is right. On many things we may disagree, but on this one we agree. It is important that the global community work together to combat money laundering. Unfortunately, in the last number of years, Canada has not kept up pace with other jurisdictions that have enacted more serious penalties and crimes and other regimes. I referenced the U.K. in my speech about unexplained wealth orders. There are a number of steps we could take. This is but one small step, and many other countries have done much more.
I am hoping this is a positive first step that will support the government's objectives, including the beneficial ownership, which many other countries already have and Canada still does not have. Yes, we need to coordinate globally, but this is a small step forward that I believe gets us to a better place.
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Madam Speaker, I listened with care to the member's introduction of his bill, and I guess I have a fundamental question about the bill. There are lots of very robust measures that have been suggested for tackling money laundering, and it seems to me that all this bill does is take something that is an administrative penalty now and make it a criminal penalty. It seems like a very small measure given the very robust recommendations we have had from the Cullen commission about the things we need to do to combat money laundering.
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Madam Speaker, if I had the benefit of being in government and significant legislative resources to bring forward additional measures, I most certainly would have done so, but the truth is there actually is not an administrative penalty for it right now. The beneficial ownership registry does not exist today, so this is a criminal penalty for those who lie about their identity or the corporate ownership structure of the name under which they are opening an account.
We need a serious penalty for a serious crime, and it needs to be criminal and not administrative. That is what we will see in the beneficial ownership registry. We need a criminal penalty for this, and we must take a step to say no to global criminals.
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Madam Speaker, coming from the banking world, I have to say there are security measures in the financial institutions to watch for money laundering. I remember it very clearly.
The thing I would like some clarification on and would like the hon. member to explain is that in the banking system one bank cannot speak to the other bank, even though we know there are illegal transactions going on. Can we enhance that, so they have the ability to speak to one another?
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Madam Speaker, yes, that is most certainly the case. This bill would not do that, but it is something we must work on together, and it is a simple rule that we could implement. I look forward to working with all members of the House on simple measures like that.
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Madam Speaker, as I indicated to the member in my question, I appreciate the manner in which the member has presented his private member's bill and his openness to hearing what other members have to say on what is a very important issue.
Money laundering and the false information that is out there have very significant impacts and ramifications, not only here in Canada but around the world. When we think of some of those ramifications, we can talk about the speculation on the costs of housing, which I think a lot of people can appreciate. We can talk about issues such as the financing and funding of terrorist acts that take place around the world. The amount of harm that is caused as a direct result of money laundering is virtually unlimited.
One of the things we need to take into consideration is actions that have already been taken, because there have been some substantial actions that have been taken. The member, for example, just made reference to the ownership registry, and I think having an ownership registry that is publicly searchable is something that is absolutely critical. Within the budget we have made movement toward that, but I would recognize that the Canada Business Corporations Act is something that is going to have to ultimately be changed. In making those modifications, one of the things we need to do as a government is to work with provincial entities to gain some support in taking some of the necessary actions to ensure the ownership registry the member talked about materializes in a way that is as effective as possible.
I recognize the member makes reference to that, and that is a very important aspect. It is something that we have referenced in budget 2022, and we did not stop there. In terms of the importance of our financial markets, and here I talk about money supply and so forth, we have to take into consideration institutions such as FINTRAC. FINTRAC is there to protect the interests of Canadians. It is very close to, if it has not already, establishing a financial intelligence unit, and there was a commitment from the federal budget of just under $90 million to support and advance that.
FINTRAC has an incredible record, and there are ways we can use FINTRAC's record to assist in dealing with and broadening the ways it can possibly help out on money laundering issues and the issues related to false information, which are actually quite rampant. It is something that is not just unique to Canada. It is becoming a larger issue from a global perspective. That is why I posed the question to the member in regard to Canada's role in advocating for global leadership, because in many ways the best way to tackle it, at least in good part, is to get like-minded countries working together.
I know the Deputy Prime Minister and Minister of Finance is very much concerned about that issue and does make efforts to try to ensure there is more of a global approach to dealing with money laundering. We have actually taken steps to establish a new Canada financial crimes agency within the budget, and again it is a move to try to address the issue right up front in a very direct way, which I think people can really appreciate.
When we talk about legislative reviews that are necessary, we have made a commitment to look at how money has been digitized. That is such a critical issue. We heard the leader of the Conservative Party talk about cryptocurrency. Members will recall his commitment to cryptocurrency. I wonder to what degree the leader of the Conservative Party actually took into consideration the possibility of laundering taking place in that digital atmosphere.
Digital money and the markets it is getting into continue to expand, so as a government we have made a commitment to move forward on that issue. The coming of the Internet and the things that take place digitally have expanded more than a hundredfold over the years. The manner in which large sums of money travel the world is quite significant and is having an impact in many different ways on our currency and on issues such as money laundering. It is one of the reasons that legislative review is in fact being taken into consideration.
There is a combination of actions the government has put in place, just from the 2022 budget, and I would encourage the member opposite to maybe meet with representatives, different possible ministers, who all contributed to the budget in dealing with an issue he obviously is very much concerned with.
I would suggest this is not the first budget in which the Government of Canada has expressed an interest in ensuring we are doing whatever we can on the issue of money laundering or people trying to avoid paying their fair share. We have had at least two budgets I can think of offhand in which there was a commitment of literally hundreds of millions of dollars. A commitment was made to have CRA look at ways in which people or corporations are using loopholes and other mechanisms to avoid paying taxes. That is something the government takes very seriously.
When we talk about the issue of laundering, it is important that it is more than one department and more than just one level of government that is ultimately responsible. It even goes beyond Canadian borders. What we have seen over the last number of years is a government that is taking a strong leadership role. It has, in fact, worked with the provinces and looked at what is happening.
In particular, let us look at British Columbia or what is taking place in Toronto and other communities, and the role casinos, for example, might be playing. We understand the depth, at least in good part, of the problem, and our budgetary actions have reflected that understanding.
I suspect that as we continue to move forward in the weeks, months and years ahead, we will see more action from the government in addressing this problem. We can understand and appreciate that it is an issue that is there that affects us all, and we will continue to move forward on it.
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Madam Speaker, I am pleased to rise this evening to speak to Bill C‑289, which was introduced by the Conservative member for Simcoe North.
I will start by saying that the Bloc Québécois is in favour of Bill C‑289, which will amend the Criminal Code to make it an offence to give false or misleading information to a financial institution requesting that information in accordance with the Proceeds of Crime (Money Laundering) and Terrorist Financing Act.
Right now, the Proceeds of Crime (Money Laundering) and Terrorist Financing Act asks financial institutions to verify their clients' true identity and the source of funds under certain circumstances. Financial institutions must also report transactions they deem suspicious to the government, so the Financial Transactions and Reports Analysis Centre of Canada, or FINTRAC, can carry out the necessary verifications, prevent laundering of the proceeds of illegal activities and prevent such funds from being used to finance illegal activities, such as terrorism.
The problem is that we know from experience that there is a serious lack of rigour and very little vigilance, at all levels, in the tracking of dirty money. If a bank's client makes a false statement, it is very likely that they will get away with it. There is minimal verification. Since the act of intentionally making a false or incomplete statement is not criminally sanctioned at present, this client has every chance of falling through the cracks. This leaves FINTRAC with incomplete information, and its work becomes less effective. This is how the chain of negligence results in dirty money being laundered in the real economy.
This is a flaw that Bill C-289 will correct. It will not fix everything, of course, but it is another step in the right direction to better uncover money laundering activities.
In May 2022, the Consulate General of Italy in Montreal organized an event to mark the 30th anniversary of “operation clean hands”, a vast anti-mafia and anti-money laundering operation during which, let us not forget, two judges were murdered. Retired Italian judge Roberto Scarpinato came to Montreal to give us a warning. He told us that Canada had become a paradise for the mafia and money laundering and that we as a society had to do something. He encouraged us to develop what he called “antibodies”, to stop being naive, to be more vigilant and not be afraid to enforce our laws to the fullest extent, because money laundering is a scourge in Canada and in Quebec.
According to Transparency International, the amount of money laundered annually in Canada could be between $43 billion and $113 billion. This means that up to $113 billion a year in proceeds of crime, from both here and abroad, is being reintroduced into our economy, allowing criminals to reap the benefits of their crime with impunity and causing economic distortions, such as skyrocketing real estate prices.
British Columbia launched a commission of inquiry into money laundering, the Cullen commission. The Cullen commission may be the most comprehensive effort ever made to understand the phenomenon of money laundering in Canada, its effects, its causes and the best ways to prevent it in future. It submitted its report in June after more than two years of work and hundreds of witness testimonies. The report points the finger at the RCMP and FINTRAC for not taking money laundering seriously enough. It excoriates the banks for looking the other way. In fact, it accuses pretty much everyone of negligence. It also provides examples of what money laundering looks like.
Take the case of Runkai Chen, a Chinese immigrant who arrived in Vancouver in 2006. While reporting an income of about $40,000 a year, he built a real estate empire worth tens of millions of dollars. Mr. Chen was a front man tasked with laundering in Canada the proceeds of corruption in China. He regularly received large transfers from foreign numbered bank accounts and reinvested the money in Canadian real estate.
He made false statements to financial institutions here that, unfortunately, were no longer asking the questions they were supposed to ask. Not one major Canadian bank raised a red flag, not RBC, not CIBC, not the Bank of Montreal. In the end, it was a foreign financial institution that alerted FINTRAC and led to his downfall. That is the type of across-the-board negligence that Judge Scarpinato was referring to when he spoke about the need to develop “antibodies”.
We actually already have a lot of the legal arsenal needed to deal with this problem. The Proceeds of Crime (Money Laundering) and Terrorist Financing Act is a powerful tool. Banks are required to verify the identity of their clients and where the money is coming from. They have the power to freeze funds they deem to be suspicious. They are required to report suspicious transactions, large cash deposits, and international transfers if they have difficulty determining where the money actually came from. All of these requirements exist, but unfortunately, most of them rely heavily on the client acting in good faith and the financial institution being vigilance.
When the government decided to invoke the Emergencies Act in what we believe, need I repeat, was an unjust manner, the Standing Committee on Finance held hearings on the financial aspect of the orders that were made following the emergency proclamation. At these hearings, representatives of the Department of Finance could not say whether the funds frozen by the financial institution had been frozen under the Emergencies Act or under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act, the law that we are discussing today and that Bill C-289 seeks to strengthen.
From the moment the occupation of downtown Ottawa was declared illegal, the financial transfers used to fund it fell within the scope of these laws. All that was required was vigilance. There was no need to invoke the Emergencies Act. It would have been sufficient to enforce the existing laws, namely the Criminal Code and the Proceeds of Crime (Money Laundering) and Terrorist Financing Act.
By forcing clients to make true and complete statements to the banks or face criminal penalties, Bill C‑289 addresses the first step, which is to verify the identity of the client and the source of the funds. This could start off a virtuous cycle rather than a vicious one, as the financial institutions themselves would be more diligent about checking. Government organizations would be better informed and more likely to co‑operate with their counterparts abroad. In short, it would help us begin to develop the antibodies needed to seriously address the scourge of money laundering.
That is why I am pleased to reiterate that we will support Bill C‑289.
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Madam Speaker, I am really pleased to rise tonight to talk about money laundering, as this is a multi-billion dollar industry in Canada. We require serious legislative and enforcement measures if we are to curb its role in facilitating other types of criminal activity and prevent money laundering from contributing to higher housing prices due to its sheer volume and the frequent use of real estate as a way to launder proceeds of crime.
I have to say that over the past decade, both the current Liberal government and the Conservative government before it have failed to devote adequate resources to the fight against the increase in money laundering and its increasing sophistication. This is becoming an increasing challenge with technological change and with the emergence of cryptocurrencies, which are quite often used for obscuring the sources of funds.
I do not wish tonight to question the motives of the member for Simcoe North for putting forward this particular bill on money laundering—
Some hon. members: Oh, oh!
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- Oct/19/22 7:37:04 p.m.
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Order. There are no questions and comments, so there should not be any loud discussions or heckling.
The hon. member for Esquimalt—Saanich—Sooke can continue.
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Madam Speaker, I am not questioning the motives of the member for Simcoe North, but I worry that the impact of putting forward such a narrow bill as Bill C-289 only makes it appear like the House of Commons, particularly the Conservatives, want to crack down on money laundering, when in fact this bill would make little or no contribution to the actual fight against money laundering.
The Cullen report on money laundering in B.C., made public last June, made literally dozens of recommendations for effective measures to fight money laundering, but creating a separate criminal offence for providing false or misleading information in money laundering investigations was not one of them.
New Democrats will be opposing this bill because a serious problem like money laundering requires a much more serious and robust action than the one small and probably redundant measure suggested in Bill C-289. I will continue to question why we are here talking about this narrow and probably redundant bill instead of talking about more robust measures to fight money laundering, such as those suggested in the Cullen report.
It is also important to note that the Cullen commission report clearly states that it was the Harper government that made a very significant contribution to the explosion of money laundering in Canada when its 2012 cutbacks to the RCMP caused the closing down of the integrated proceeds of crime units, which it had been operating in each province from 1990 to 2012.
Let me quote the Cullen report directly here. It states, “The RCMP's lack of attention to money laundering has allowed the unchecked growth of money laundering since...2012.” A cynic might even wonder if this Conservative private member's bill on money laundering might have been put forward as a distraction from the role the Harper Conservative government played in allowing the explosion of money laundering through its cutbacks in 2012.
The current Liberal government does not escape criticism either. The Cullen commission reports condemns the current federal anti-money laundering legislation and enforcement in simply one word, ineffective. I will cite just one piece of evidence of how ineffective the current federal efforts are.
In 2019-20, FINTRAC received over 31 million individual reports of suspicious financial transactions, yet it transferred only 2,057 of those reports to law enforcement agencies. When we compare the efforts of other jurisdictions, we find that they have many more reports. If we compare it to the United States, we get about 12 times as many reports of suspicious transactions, but when it comes to actual prosecutions as a result of those reports, we are in the tiny percentages.
The Cullen report did note that there was some progress in British Columbia starting in 2015 when David Eby became the B.C. attorney general. The previous government had very clear warnings from law enforcement and regulators that money laundering had become a massive industry in B.C., especially at casinos. A key change was finally introduced in 2018 by Attorney General Eby. It implemented a provision requiring casino patrons to present proof that the cash used in transactions of $10,000 or more came from legitimate sources, and there was an immediate drop in the amount of transactions over $10,000 in those casinos.
While the Cullen commission report and study were really focused on British Columbia, it still made six major suggestions for improving the federal response to money laundering. I will talk for just a minute about each one of those, and they are: unexplained wealth orders; corporate beneficial ownership registry; a program to fight trade-based money laundering; better and more frequent scrutiny of money service businesses; the requirement for better reporting by chartered professional accountants; and, finally, better regulation of the mortgage industry.
All of those are not things that we normally talk about in our daily lives, so let me talk for a minute about unexplained wealth orders, which has been used very successfully in the United Kingdom. This is where either FINTRAC, or possibly the Canada Revenue Agency, would be given the power to go to court where criminal activity is suspected and require those suspected to produce information about where the money used to purchase assets has come from, was the source of funds was to purchase, for instance, real estate. If it cannot be explained and proven that it came from legal sources, then the court can order that property forfeited to the government. This is essentially what happens in British Columbia through the civil forfeiture process. That is a power we do not have. It is one I would like to see us talking about here tonight, rather than this narrow bill.
The second major recommendation is for a corporate beneficial owner registry. What does that mean in common language? We have numbered corporations, which means we cannot figure out who actually owns them and we cannot figure out their links to other corporations that take place in the darkness of those numbered corporations.
We are told now that legislation is coming. I am interested to hear the Conservatives say that they are now in favour of public access to a corporate beneficial ownership registry, but I have to say that in 2018, when New Democrats put forward this kind of idea, neither the Liberals nor the Conservatives were enthusiastic about proceeding with this. This is a recommendation that has already been made in the fisheries and oceans committee as a way of getting at another problem on the west coast in British Columbia, and that is the problem of not being able to find out who actually owns fishing licences because a great number of them are numbered corporations. I am happy that we appear to have a consensus growing here that we need such a corporate beneficial ownership registry. I would like to see the government come forward very soon with legislation to implement that proposal.
The Cullen commission also pointed out that probably one of the largest sources of money laundering goes completely unmonitored in this country, and that is what is called trade-based money laundering. If I understand it, it is pretty simple. People who make money from illegal criminal activities order and purchase goods from abroad which either do not exist or are not valued at the amount they are paying. That money goes to a company they own offshore and then comes back as clean money as a result of selling products into Canada. Nobody is monitoring this, nobody at all.
The Cullen commission said very clearly that the federal government should set up a program that would combat trade-based money laundering and the power to share information with other governments about suspicious trade transactions, which apparently are simply money laundering. That is another good thing we could be talking about tonight instead of this very narrow bill.
I will briefly name the problem with chartered professional accountants, which is that in a five-year period, only one chartered professional accountant was ever prosecuted for participating in money laundering. I would like people to raise their hands if they think that only happened once in five years in Canada. The Cullen commission pointed out that we need better reporting regulations for chartered professional accountants and we need better monitoring of their activities. It is not casting aspersions on all CPAs. It is saying that the lack of monitoring allows for those who are unscrupulous to take advantage of that and get involved in money laundering.
The fifth one of those is better and more frequent scrutiny of what are called money service businesses. That is where money is transferred back and forth abroad or back and forth around the country. There is a peculiar regulation that allows most of those businesses to avoid scrutiny from FINTRAC by changing their names and reconstituting themselves every two years. The final one is better regulation of the mortgage industry.
Let me close by repeating what I said. Money laundering is a very serious problem and we need serious measures, both in terms of legislation and enforcement, to crack down on money laundering. I do not believe that Bill C-289 is one of those measures. I do not think it makes a major contribution. However, both the Liberal and Conservative governments before and both Liberal and Conservative government policies before have prevented us from taking the actions we need to take on money laundering on a serious basis.
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Madam Speaker, it gives me great pleasure to engage in this debate and to support this bill from my colleague, the member for Simcoe North. My colleague suggested that he is a rookie, but I think a lot of us know that he is one of the rising stars here on the Conservative side. He has brought forward a bill that is perhaps the first step in addressing the issue of money laundering. For me as a British Columbian and a member of Parliament from the west coast, it is especially important, because this is an issue that has now been thoroughly canvassed by the Cullen commission. I will get into that in a moment.
Money laundering is a very serious problem that deserves our serious attention. The amount of money that is laundered is in the many billions of dollars. Perhaps $100 billion a year is being laundered through casinos and real estate. It has a huge impact on Canadians. It has a huge impact on our prosperity and our lifestyles.
Money laundering is, at its very core, criminal. It is an activity firmly rooted in greed that has a complete disregard for the interests of others. Money laundering is deeply destructive to our communities and our families, and is thoroughly implicated in things like gun smuggling, drug trafficking and human trafficking. It goes on and on. Who suffers the most from money laundering? It is our communities and the most vulnerable members of our society, particularly those with addictions, mental health challenges and gambling addictions.
Money laundering is also implicated in much of the gun and gang violence we see across the country, including in my community of Abbotsford. It is an affront to every law-abiding citizen who earns their money honestly, pays their taxes and invests in their communities. It is essential that all of us, whether it is government, law enforcement or regulators, take strong and decisive action to fight this problem.
I mentioned that money laundering is an expensive business for Canadians. Billions of dollars are not being declared and are not being taxed, but are going into criminal activity. There is very little that has been done to address this problem so far.
A significant amount of money that is laundered ends up in our real estate market. I do not know if members understand that, or if Canadians understand that money laundering plays a significant role in the skyrocketing cost of real estate. It is not the only factor but it is one significant factor.
What happens is that these laundered funds end up in real estate and distort real estate prices, especially real estate prices close to major urban markets. Residents then have to seek lower housing costs by moving away from larger cities to communities such as Abbotsford, which in turn strains local real estate markets. Laundering money in Canada is therefore not a benign activity.
What are we supposed to do about it? So far, money laundering has not been addressed in a comprehensive way. The Cullen commission in British Columbia led to a damning report that concluded that billions of dollars per year were being laundered, and that was just in the province of B.C. alone. It called for sweeping changes. The commission found that this dirty money has been laundered through real estate, casinos and the purchase of luxury goods, for example, and Mr. Cullen made 101 recommendations.
To answer my colleague from the NDP, the soft-on-crime NDP, who said this bill is too narrow and too minor to support, I have never heard that argument made in the House before. I have never heard that a significant, narrow Criminal Code amendment could be too minor to support. Had my colleague from Simcoe North broadened this legislation, the NDP would not have supported it; we know that. The NDP is soft on crime. Canadians understand that.
The other thing is that we here on the Conservative side are the official opposition. We are not government. We are not the ones who are supposed to be bringing forward big bills to address the rising crime rate in Canada, especially when it comes to money laundering. That is the role of the Liberal government, which is being propped up by the NDP, who will not bring forward this kind of law or anything close to substantially addressing the issue of money laundering in Canada.
Let us talk about the recommendations the Cullen Commission made. Most of these recommendations are actually directed at the Province of British Columbia. When my NDP colleague says there are all these recommendations and this is not one of them, I can say that my colleague from Simcoe North did his research and his homework.
The bill before us, where individuals who lie to reporting authorities and organizations can go to jail for up to 10 years and can be fined a million dollars, is a big step. It is not a minor step. It is not a narrow step. It is a big step in the right direction. When I said, at the beginning of my remarks, that this is a step, someone has to take the first step. It is usually up to Conservatives to do that and that is what we are doing.
I am really saddened to see that the NDP has decided not to support the legislation. It is not about its merits. It is because it is too narrow. The NDP thinks it is too insignificant so it is going to push it aside and vote no. Canadians have to understand the perspective that the NDP comes from when it comes to addressing crime in Canada.
What are these recommendations that Justice Cullen made? There was a suggestion that there should be a dedicated provincial money laundering intelligence and investigation unit. It said the government should develop anti-money laundering guidance for financial institutions and the money service businesses that are often implicated in money laundering.
He recommended that a corporate beneficial ownership registry should be established, and we see that the Liberal government has now included that beneficial ownership registry in its budget. Has it been implemented, this public beneficial ownership registry? No. In fact, it said it will get it done by the end of 2023. Quite frankly, we could have an election by then. We all know that. By the end of 2023, we could have an election because the marriage between the NDP and the Liberals will likely break up before then. We will be in the middle of divorce proceedings between the two.
Another recommendation is that cryptocurrencies should be regulated because this is the next frontier in which money laundering will take place, if it is not taking place already. There was a recommendation that the threshold for requiring proof of the source of funds for casino transactions conducted in cash should be reduced. There is the suggestion that all cash transactions for the purchase and sale of luxury goods over $10,000 should be reported. There was also a suggestion that professional bodies like lawyers and accountants should be regulated more strictly.
These 101 recommendations, many of which were directed at the Province of British Columbia, provide us with a lot of fodder, a lot of support. At the end of the day, actually having some penalties, like prison time or massive fines, for those who lie to reporting authorities is a good step forward.
I thank my colleague from Simcoe North for bringing forward this very important bill.
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The time provided for the consideration of Private Members' Business has now expired and the order is dropped to the bottom of the order of precedence on the Order Paper.
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- Oct/19/22 7:57:04 p.m.
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Madam Speaker, it is great to be in the House tonight and dealing with this topic. I am glad to see the parliamentary secretary for health, and since I have asked a question about health, we will start with a bit about health.
There was the warning label on ground beef and pork. There was no warning label on the same cuts of beef and pork when they were whole, but all of a sudden there was a warning label on the ground meat itself. Maybe it was the knife. Maybe it was the grinding that made it. I do not know what the science was, but a couple of people have mentioned analogies to me. They said we might have a whole log that had no warning label on it, yet if we cut it up into a two-by-four, it might get a warning label. Maybe it is the saw. What about a potato? If it was whole and baked it could have no warning label, but if we turned it into mashed potatoes, it might get a warning label. Maybe it is the utensils.
The science must have changed, because the Liberals reversed it. We did not know what the science was before, but the science changed, so they reversed it. They did not tell us what the reversing science was.
Let us go into a bit more about health in the ag sector, because it is huge in the sense that it directly affects ag. Is there a lot of stress in the ag sector? There absolutely is. Have members seen the suicide rate in the ag sector? They should check it out.
In my riding we have irrigation, and a lot of irrigation. Four per cent of the land produces almost 20% of the Alberta ag GDP. Electricity is used to produce irrigation. Electricity is not a fuel, so there is not an exemption for fuel. As a business expense, it is very small: less than part of 1%. It is an inflation carbon tax. The carbon tax takes literally millions away from my ag producers. Does this cause stress and is it a health problem? Absolutely.
Now, the Liberals want to triple the carbon tax. It is not going to be returned; it is gone. That means there is a ripple effect on the machinery producers and the communities. Wherever they buy, there is less money there.
Stress is there in the ag sector. The warning label on beef was just one of the stresses, but the tripling of the carbon tax and the cost of irrigation, which is huge in my riding, is another problem for health in my ag producers.
The minister announced a 30% fertilizer reduction by 2030. Where was the science? Where was the baseline? Where was the consultation with the ag organizations, with the wheat organizations or with the fertilizer or ag producers? Why is the minister not talking about it being voluntary now? Does this create stress and a health issue in the ag sector? Absolutely it does, because there were no consultations and no credit was given to incredible, world-leading Canadian ag producers whose work is science-based, capturing carbon, reducing fertilizer use and using other practices that are world leading.
There is no science behind this 30% reduction of emissions. These are world-leading ag producers who are doing it. They will continue to do it. The government's goal, which it now calls voluntary even though it was not, was to reduce ag production by $20 billion a year. Canadian food security would go down if it did this, and export production would go down.
Where is the science, and what about the stress on their mental health of tripling the carbon tax on the ag producers, especially in the irrigation sector in my riding?
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- Oct/19/22 8:00:58 p.m.
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Madam Speaker, it is always a pleasure to come into the House to discuss these issues with my friend from Bow River. He was a teacher, so it is interesting to me that he, like many of his colleagues, refers to a change in the price on pollution, or “carbon tax”, as he calls it. Of course judges in courts across the country have deemed it not to be a tax, because it is not a revenue program, but when it goes up $15 from $50, I still fail to see how that is a tripling. Perhaps my colleague from Bow River was not a math teacher.
I appreciate the opportunity to talk about this important initiative that will help Canadians make healthier choices.
There is a chronic disease crisis in Canada and its scope is staggering and increasing. Diet-related chronic diseases like type 2 diabetes and cardiovascular disease are now a leading cause of illness and death. Two out of five Canadians live with a chronic disease. COVID-19 showed us that people with obesity and diet-related chronic diseases are more vulnerable to hospitalization and death. This problem is growing and has a human cost. Chronic disease diminishes quality of life and shortens lifespan. It robs us of time with our loved ones. It also has a significant impact on the health care system and our economy. No egg producers or anybody, really, are immune from these complicated lifestyle-related diseases.
My colleague from Bow River did reference front-of-package labelling on ground beef which, if he had a look at the legislation, he would know there is no front-of-package labelling on ground beef as he indicated. He is correct. The vast majority of single ingredient foods, including butter, milk or sugar, are not front-of-package labelled as a product that contains a lot of sugar. A bag of sugar is not front-of-package labelled because, of course, it contains sugar: it is sugar.
More than half of the packaged foods in grocery stores are high in sodium, sugar and saturated fat. Most of us eat too much of that stuff without even realizing it.
Canadians' average intake exceeds the recommendations established by authorities such as the World Health Organization.
The front-of-package symbol will signal to consumers to look more closely at nutrition facts on the label. It will only be required on foods that meet or exceed certain thresholds for saturated fat, sodium and sugar. The symbol will give consumers more information about what is in their food. It will help them quickly and easily make healthier choices.
Several countries have advanced similar regulations, and evaluations clearly show that symbols are effective and help people make better decisions when they are at the grocery store. More information is always a good thing. As a teacher, I am certain that my friend from Bow River would agree.
To ensure the policy will be effective, exemptions are only provided in specific circumstances, such as when there is evidence that the food provides a protective effect on health, like fruits, vegetables or healthy oils.
In most cases, when consumers go to the grocery store, there are options in every food category that do not carry the front-of-package symbol.
It is time to provide Canadians with the information they need to choose healthier foods. The evidence is clear that front-of-package labelling will help consumers make healthier choices. That is why I am glad that our government has brought them forward on foods that Canadians will now have a little bit more information on.
My colleague's questions did not focus only on front-of-package labelling, so I look forward to the rebuttal.
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- Oct/19/22 8:04:47 p.m.
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Madam Speaker, I always appreciate being in the House with the parliamentary secretary and hearing his response to what I may say, which might be slightly different from what he might have expected.
I will talk again about the irrigation districts, the lack of pipes, the cost of pipes and the environmental practice of putting in pipes instead of canals. The price is now over 200% more than it was a year ago. Municipalities are also experiencing the same cost for pipes to put in the ground.
We are talking about a challenge that is stress related. It is hard on irrigation ag producers in my riding when there is talk about increasing the carbon tax, as the government is going to do. This is a price taker. That creates stress and mental health challenges for the ag producers who produce all of this food for our country and food security.
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- Oct/19/22 8:05:43 p.m.
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Madam Speaker, it is always a pleasure to talk with my colleague from Bow River.
I am glad that he brought up the top of climate change. I met with a whole bunch of farmers from my riding. Many people are not aware that the riding of Milton is home to many ag producers. We have beef farmers, chicken farmers, egg farmers and apple farmers. When my family came from the Netherlands, they settled just outside of Chatham, Ontario, and they are apple farmers themselves.
I love visiting farms and talking to farmers. I will say that the farmers in my riding are committed to fighting climate change. They understand that they have an extraordinarily important role to play and they are focused on saving our environment from climate change. I know that the farmers in my colleague's riding also care about climate change and fighting it.
It is up to the provinces to decide if they would like to bring something forward like cap and trade or another measure to fight climate change. For the provinces that do not, like Alberta where my colleague is from, and Ontario where I live, we have a backstop program and that is a price on pollution. It is a good thing.
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- Oct/19/22 8:06:55 p.m.
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Madam Speaker, this spring, the government had a chance to listen to the experts and act on the toxic drug crisis that is taking a tragic toll on our communities every day. In my riding, in the small community of Port Alberni in the Alberni Valley with just over 30,000 people, we lost 20 people in just the first eight months of this year due to the toxic drug supply. These deaths were preventable and each person lost has loved ones who are left to deal with that grief in the face of government failure. That is four times the national average.
Across the country, we lost over 7,500 lives just last year. Shamefully, we have lost more than 30,000 lives since 2016. I heard the question from people who have been impacted by this crisis. They ask, “How many lives is it going to take before there is real action?” I worry that those with the power to bring change are becoming numb to these numbers. We must never lose sight of the fact that these numbers represent children, siblings, parents, partners, friends and neighbours.
The day this House rose for the summer, the Public Health Agency of Canada released modelling, forecasting, that the toxic drug crisis would continue its tragic path and possibly even worsen over the rest of the year. The agency predicted that we might lose as many as 2,400 Canadians per quarter. These are real lives. While we all returned to our communities for three months this summer, more than 2,000 families were planning funerals that did not need to happen.
They did not need to happen because last year Health Canada's expert task force on substance use made clear recommendations on how to respond to this crisis. Those recommendations included stopping the criminalization of people who use drugs, making significant new investments in supports for people who use drugs and who are in recovery, and expanding safer supply.
Our bill, Bill C-216, a health-based approach to substance use, reflected the paradigm shift the expert task force called for to stop the harm in our communities. However, instead of listening to its own task force, the Liberal government teamed up with the Conservatives to vote down Bill C-216. In the face of a public health emergency that has been worsening for years, the Liberal government is choosing an ineffective piecemeal response because of stigma and politics.
Every day, the government has an opportunity to make a different choice. By granting B.C.'s decriminalization request, the government has acknowledged the harms of criminalizing people who use drugs, yet it continues to allow these harms in every other province and territory in this country.
The Minister of Mental Health and Addictions has acknowledged that funding for the substance use and addictions program is not enough to meet the demand, but the government will not put enough money on the table to ensure people can get help when they need it. The minister has acknowledged the critical role that a safer supply must play in addressing this crisis, but the government remains focused on small-scale pilot projects rather than procuring a safer supply that could save lives across the country.
When will the government finally act like this is a life-or-death matter for thousands of Canadians each day and mount an urgent national response? When?
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- Oct/19/22 8:10:44 p.m.
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Madam Speaker, before I start, I would like to say thanks to my friend from Courtenay—Alberni. He is a tremendously passionate, outspoken and dogged ambassador, advocate and spokesperson for this cause. He knows that I respect him. He knows that I think he is doing incredible work here in the House, in his community and across the country regarding the overdose crisis. I am proud to be in the House with him and am proud to have an opportunity to discuss this important issue here tonight.
First, our hearts go out to all of the families and communities that have lost loved ones to the opioid crisis and through the tainted, poisoned drug supply that exists in our country. The Government of Canada remains deeply concerned about the devastating impact that the overdose crisis continues to have on people, families and communities across the country, and we recognize that substance use is first and foremost a health issue.
We are committed to a public health approach to substance use that is comprehensive, collaborative and compassionate, and are working with our key stakeholders, including people with lived and living experiences regarding substance use. It is a foundational part of our government's work. We continue to work with partners to look at ways to support programs and services and divert people who use drugs away from the criminal justice system and toward supportive and trusted relationships and health and social services, such as, as my colleague suggested, supervised consumption sites and safe supply.
Since January 1, 2016, the number of supervised consumption sites operating in Canada has increased from just one to 39. We have also funded a number of safer supply pilot projects that provide people who are at high risk of overdose with prescribed pharmaceutical-grade alternatives to the toxic and illegal drug supply on the streets. This emerging practice is a key area of interest for the Government of Canada, and evaluation efforts for these services are already under way. Indeed, there has been great progress in the last six months in British Columbia due in part to advocates like my friend from Courtenay—Alberni.
I want to reiterate that we have lost too many Canadians to overdose. We have heard from stakeholders that the criminalization of possession of drugs for personal use perpetuates stigma. It increases the risk of overdose and other harms and creates barriers to care. This government has been clear in its actions that substance use must be treated as a health issue first.
Recently, the House sent Bill C-5 to committee for review. Among other measures, Bill C-5 would require police and prosecutors to consider alternatives to laying charges or prosecuting individuals for drug possession, such as diversion to treatment, a warning or taking no further action.
I have spoken to police officers in my riding specifically about Bill C-216 and how we can face this crisis head-on with compassion and find a solution, not just lock people in jail. I will say that officers at Halton police services in Milton, the ones I spoke to, have been employing these practices of their own accord. They have strong feelings about the opioid epidemic, and it is important to recognize that Oakville, Milton and Burlington are, in large part, wealthy suburban communities. The opioid epidemic affects everyone.
That is why I will continue to work with provincial, territorial and municipal partners, like those in British Columbia and Vancouver, and other key stakeholders and regions throughout this country, to reduce risk, save lives and get people the support they need. Canadians can be assured that combatting the opioid overdose crisis remains a key priority for the government, for the Minister of Health and for me.
I know this is true of my colleague as well. I was proud not to be one of the people in the House to vote against my colleague's bill. I believed in it and continue to, and I am thrilled we are working together on it.
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