An Act to amend the Criminal Code (conditional sentence of imprisonment)

This bill was last introduced in the 39th Parliament, 1st Session, which ended in October 2007.

Sponsor

Vic Toews  Conservative

Status

This bill has received Royal Assent and is now law.

Summary

This is from the published bill. The Library of Parliament often publishes better independent summaries.

This enactment amends section 742.1 of the Criminal Code to provide that a person convicted of a serious personal injury offence as defined in section 752 of that Act, a terrorism offence or a criminal organization offence prosecuted by way of indictment for which the maximum term of imprisonment is ten years or more is not eligible for a conditional sentence.

Elsewhere

All sorts of information on this bill is available at LEGISinfo, an excellent resource from the Library of Parliament. You can also read the full text of the bill.

Votes

Nov. 1, 2006 Failed That Bill C-9, in Clause 1, be amended (a) by replacing lines 6 to 13 on page 1 with the following: “742.1 (1) If a person is convicted of an offence and the court imposes a sentence” (b) by adding after line 25 on page 1 the following: “(2) Despite subsection (1), the court shall not order that an offender serve the sentence in the community if the offender is convicted of any of the following offences: ( a) an offence punishable by a minimum term of imprisonment; ( b) an offence prosecuted by way of indictment for which the maximum term of imprisonment is fourteen years or more; and( c) any of the following offences, if prosecuted by way of indictment and punishable by a maximum term of imprisonment of ten years:(i) a terrorism offence, (ii) a criminal organization offence, (iii) an offence under any of the following provisions: (A) section 83.231 (hoax — terrorist activity), (B) subsection 88(1) (possession of weapon for dangerous purpose), (C) section 144 (prison breach), (D) section 160 (bestiality, compelling, in presence of or by child), (E) subsection 212(1) (procuring), (F) section 221 (causing bodily harm by criminal negligence), (G) subsection 249(3) (dangerous operation causing bodily harm), (H) subsection 252(1.2) (offence involving bodily harm), (I) subsection 255(2) (impaired driving causing bodily harm), (J) section 264 (criminal harassment), (K) section 267 (assault with a weapon or causing bodily harm), (L) section 271 (sexual assault), (M) section 279 (kidnapping, forcible confinement), (N) section 279.02 (trafficking in persons — material benefit), (O) section 281 (abduction of person under 14), (P) section 282 (abduction in contravention of custody order), (Q) section 283 (abduction), (R) paragraph 334( a) (theft),(S) subsections 342(1) and (3) (theft, forgery of credit card, unauthorized use of credit card data), (T) paragraph 348(1)( e) (breaking and entering with intent, committing offence or breaking out),(U) section 349 (being unlawfully in dwelling-house), (V) section 354 (possession of property obtained by crime), (W) section 382 (fraudulent manipulation of stock exchange transactions), (X) subsection 382.1(1) (prohibited insider trading), (Y) section 396 (offences in relation to mines), (Z) section 400 (false prospectus), (Z.1) section 403 (personation with intent), (Z.2) section 424.1 (threat against United Nations or associated personnel), (Z.3) section 435 (arson for fraudulent purpose), and (Z.4) section 465 (conspiracy), (iv) an offence under any of the following provisions of the Criminal Code, chapter C-34 of the Revised Statutes of Canada, 1970, as they read immediately before January 4, 1983: (A) section 145 (attempt to commit rape), and (B) section 156 (indecent assault on male), (v) an offence under any of the following provisions of the Controlled Drugs and Substances Act:(A) section 5 (trafficking), (B) section 6 (importing and exporting), and (C) section 7 (production), (vi) an offence under any of the following provisions of the Food and Drugs Act, as they read immediately before the coming into force of section 64 of the Controlled Drugs and Substances Act:(A) section 39 (trafficking in controlled drugs), (B) section 44.2 (possession of property obtained by trafficking in controlled drugs), (C) section 44.3 (laundering proceeds of trafficking in controlled drugs), (D) section 48 (trafficking in restricted drugs), (E) section 50.2 (possession of property obtained by trafficking in restricted drugs), and (F) section 50.3 (laundering proceeds of trafficking in restricted drugs), and (vii) an offence under any of the following provisions of the Narcotic Control Act, as they read immediately before the coming into force of section 64 of the Controlled Drugs and Substances Act:(A) section 19.1 (possession of property obtained by certain offences), and (B) section 19.2 (laundering proceeds of certain offences).”
June 6, 2006 Passed That the Bill be now read a second time and referred to the Standing Committee on Justice and Human Rights.

February 5th, 2007 / 11:35 a.m.
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Bloc

Réal Ménard Bloc Hochelaga, QC

You're trying to gain my support, you rascal. I understand that you have taken a strategic approach, which is understandable, but I know that Bill C-9 was defeated. I'm just wondering how effective the measure would be, but I understand your point. Go ahead.

February 5th, 2007 / 11:30 a.m.
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Bloc

Réal Ménard Bloc Hochelaga, QC

Thank you, Mr. Chairman.

I would like to begin by congratulating our colleague for his initiative. I know that when a member tables a bill in the House of Commons, no matter what one thinks of it, that person always does so with conviction. It is important that time be set aside in the House for members who are not government ministers. I have always told my party that there should be two hours a day set aside for private members' business. I think that there is an imbalance between the time given to the government and the time given to members. I am convinced that you have acted based on your convictions and I would like to congratulate you for that.

However, I must admit that we have some reservations. Of course, not as far as your objectives are concerned. Indeed, if your premise is that Parliament should always try to implement the most effective deterrent measures to protect children, I believe that all parties, including the government and opposition parties, would support that objective.

My question is as follows. You would like to increase the maximum sentence to 10 years. I exclude from this issue the debate surrounding the study of Bill C-9, because that bill, as you know, was amended significantly. You drafted a bill which targets people who lure children. In your opinion, what is the scope of this offence? Judges will have to consider what luring children is exactly. How would you define that? What exactly does "luring children" mean to you?

I will come back later on to the other offences which follow, because that is basically what you're asking us to vote on: luring children over the Internet. You then referred to other offences of a sexual nature, but these do not necessarily fall under section 172.1 of the Criminal Code. You want to increase the offence to 10 years' imprisonment. So, in your view, what exactly does "luring children" mean?

December 4th, 2006 / 4:45 p.m.
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President, Association québécoise des avocats et avocates de la défense

Lucie Joncas

If I may, on the same question, I can refer the committee to the submissions of the Quebec Bar Association. The Quebec Bar made submissions on Bill C-9 about restricting jail time to be served within the community. I believe the legislative committee of the Quebec Bar represents both defence and Crown.

December 4th, 2006 / 3:30 p.m.
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Lucie Joncas President, Association québécoise des avocats et avocates de la défense

Hello.

The Association québécoise des avocats et avocates de la défense is a not-for-profit association composed of 600 criminal defence lawyers practising throughout all regions of Quebec. Our members include private practice lawyers as well as those working for the Commission des services juridiques. I have had the honour of serving as president of the association since June 2005. I have been practising mainly in the field of criminal law for almost 15 years now.

First off, the AQAAD would like to thank the committee for this invitation to appear. I hope my remarks will be useful to you in the course of your deliberations.

It seems troubling to read the May 1, 2006, press release that states the objective of these new dispositions. It says that mandatory minimum penalties will ensure that sentencing is proportionate to the seriousness of the offence that involves guns and gang violence.

The aim is obviously a direct attack on judicial discretion. It is my belief and experience that judges in Canada are currently imposing just and proportional sentences. Furthermore, the concern with gang-related offences is already the object of a specific sentencing provision of the Criminal Code, namely subparagraph 718.2(a)(iv). It is considered an aggravating factor on sentence that an offence is committed for the benefit of, or under the direction or association with, a criminal organization.

The AQAAD is in agreement with the statement found in the legislative summary of Bill C-10: “Mandatory minimum terms of imprisonment are generally inconsistent with the fundamental principle that a sentence must be proportionate to the gravity of the offence and the degree of responsibility of the offender, as they do not allow a judge to make any exception in an appropriate case.” It is generally recognized as a principle, and is borne out by my experience as a defence attorney, that the deterrent effect is triggered by the fear of being apprehended rather than by the existence of harsh sentences.

The Canadian crime rate does not require these legislative changes. The American example has served as an eloquent example of the ineffectiveness of such measures.

Moreover, the new wave of bills your committee has dealt with and those it will be considering, such as Bill C-9, and reverse onus for dangerous offenders, to name but two, may have a domino effect. We would like to draw this to your attention because we believe it is a possibility you should consider. Allow me to explain: the combined effect of these measures will have a direct impact on the justice system's ability to deal with cases within a reasonable timeframe, as provided under the charter.

These provisions will also effectively short-circuit the case settlement process. At the moment, as a general rule, approximately 90% of criminal charges are resolved through guilty pleas, and a number of these guilty pleas are accompanied by joint submissions. These figures may drastically change as a result of so many legislative amendments. Consequently, the number of individuals in pre-trial detention will increase, thereby increasing the burden on provincial resources.

We must remember that under sentencing in Canada, if the crown finds a sentence too lenient, it is always at liberty to appeal. Conversely, this same right would be denied under mandatory minimum sentences when the defence believed that given the circumstances of the offence and the offender, a sentence was clearly too harsh.

We consider that these legislative amendments are not necessary, and feel that they will have a significant negative effect on the criminal justice system. Finally, as an alternative—and I repeat, as an alternative—if the committee were to come to the conclusion that the proposed sentences may be useful as guidelines, we would suggest an amendment to section 718.3 of the Criminal Code, an amendment calling for residual judicial discretion. Under special circumstances and when it is in the interest of the community and of the accused, judges could exercise their discretion at the time of sentencing.

I thank you and I am now prepared to answer any questions you may have.

November 27th, 2006 / 4:35 p.m.
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President, Canadian Police Association

Tony Cannavino

I'm told he was a witness in the study of Bill C-9.

November 27th, 2006 / 4:35 p.m.
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David Griffin

He was a witness on Bill C-9.

November 23rd, 2006 / 4:15 p.m.
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Vice-President, Policy, Planning and External Relations, Legal Aid Ontario

George Biggar

As I said at the outset, every change to the justice system is an increased pressure on all of the system, and that includes legal aid. Some of these changes we can estimate better than others. For example, we've done estimates on the likely cost of legal aid due to increasing the number of police officers on the street by 1,000, as the government has done. We did an estimate on the cost effects of Bill C-9, the bill that deals with alternatives to incarceration, and we have done the estimate I presented this afternoon in relation to the cost of Bill C-10. What we in general are seeking from the federal government, since criminal law is a federal responsibility and that is in fact recognized by the federal government through the federal-provincial contribution agreement, is that the government, through the budget process, increase the funding available to the legal aid plans across the country in order that they may effectively respond to the increased—

November 23rd, 2006 / 3:55 p.m.
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Program Director, Aboriginal Legal Services of Toronto

Jonathan Rudin

Thank you.

Again, I apologize for my lateness. I also apologize on behalf of Marisha Roman, our vice-president, who was with me last month in Ottawa. She very much wanted to be here today as well, but she came down with the flu this morning, had to leave work, and was not able to make it.

We are very pleased to be appearing here again before the Standing Committee on Justice and Human Rights. Since our last appearance before you was just a month ago, we'll dispense with the background information on our organization, as we trust it's relatively fresh in your mind. We first want to thank the members of the committee for its consideration of our submissions regarding Bill C-9.

We're here today to discuss Bill C-10, a bill that amends the Criminal Code. Prior to commenting specifically on these amendments, we feel it's important to address what is, for us, the disturbing trend of the increasing reliance on minimum sentences in the Criminal Code.

This trend did not begin with the current government. Bill C-2, passed in the last Parliament, added minimum sentences to 11 sexual offences. In some cases, the minimum sentences were as low as 14 days. It appears that often the only explanation for the imposition of a minimum sentence is to prevent judges from considering a conditional sentence. Minimum sentences of 14 to 90 days cannot seriously be justified for their ability to deter crime or to lead to a change in behaviour of offenders while incarcerated.

In our discussion before the justice committee last month, we spoke about the ability that judges have to craft conditional sentences that can address the root causes of offending behaviour without sacrificing community safety. In fact, a well-crafted conditional sentence will lead to increased community safety. Unfortunately, increased reliance on minimum sentences means there is less room for conditional sentences.

We would like to raise four specific concerns with respect to Bill C-10 and make one suggested amendment. Our concerns are: one, we believe the manner in which the bill deals with hybrid offences is unconstitutional; two, too many minimum sentences start with penitentiary terms; three, there is no reason to believe that minimum sentences deter crime; and four, the bill will increase aboriginal overrepresentation in prison. Our suggested amendment is that the bill allow for a judge to avoid the imposition of a minimum sentence in exceptional circumstances.

We will start with our concerns.

At our last appearance before the committee, we noted that one of the problems with Bill C-9 was that it gave the Crown the ability to decide whether an offender could receive a conditional sentence, based on whether the Crown proceeded summarily or by indictment. This problem is even more acute in Bill C-10. A number of offences in Bill C-10 are hybrid offences. There are no minimums if the Crown proceeds summarily. There are minimums if the Crown proceeds by indictment. In some cases, these minimums start at three years' imprisonment.

For example, a first-time offender charged with unauthorized possession of a prohibited or restricted weapon that is loaded or near ammunition will, if the Crown proceeds summarily, have all sentencing options available. On the other hand, if the Crown, in its sole discretion, chooses to prosecute by indictment, the minimum sentence is three years' imprisonment.

Such an arrangement places a great deal of unchecked power in the hands of the Crown. It also raises very serious concerns that the section violates the protection against cruel and unusual punishment found in the Charter of Rights and Freedoms. We will participate in any constitutional challenge against these provisions of Bill C-10.

Secondly, we are concerned by the increased number of minimum sentences that start at three years' imprisonment. While there are some individuals who, for public safety, must be sentenced to penitentiary time, this bill casts the net too wide. Members of this committee should be under no illusion that a three-year sentence will lead to positive change in the lives of offenders. Information we have received from Correctional Service Canada in Ontario indicates that individuals sentenced to two- to three-year sentences will receive no substantive programming at all in penitentiary prior to their release.

This bill will result in some individuals with little or no prior involvement with the criminal justice system going directly to the penitentiary. Being incarcerated with the most dangerous offenders in Canada will give these people the opportunity to learn new skills, but not, unfortunately, the skills we would want them to learn.

We have to be realistic about what happens to people when they go to penitentiary. In most cases, they come out worse than when they went in.

Third, at the heart of this bill is the belief that minimum sentences deter people from crime. Since much of this bill is concerned with increasing the minimum sentences for offences where minimum sentences already exist, the assumption must be that higher minimum sentences deter people even more. The fundamental problem with this theory is that there is no evidence to support it. Studies by the eminent British criminologists Andrew Ashworth and Andrew von Hirsch both concluded that deterrence in the criminal justice system comes from the probability of detection rather than consideration of potential punishment.

The penalty for first degree murder is life imprisonment without parole for 25 years, yet despite this most severe mandatory minimum sentence, gun violence and gun death were quite prominent last year. If a 25-year mandatory minimum did not deter the most serious of gun crimes, why should we expect that shorter minimums would accomplish the task?

Our final concern with the bill relates to aboriginal overrepresentation. It must always be kept in mind that reliance on deterrence as a theory for punishment has a significant impact on aboriginal people. As we noted last month, despite making up only 3% of the Canadian population, aboriginal people comprise 22% of those in Canadian prisons. Aboriginal people know better than anyone else that doing the crime means doing the time, yet rates of aboriginal over-incarceration continue to rise. In large part, this is because much of aboriginal offending is not calculated organized crime, but rather an unthinking response to immediate pressures. Addictions, interpersonal violence, a sense of hopelessness, and the legacy of government practices such as residential school and mass adoptions all play a large role in explaining why aboriginal people commit crime. This does not excuse the behaviour, but we need to understand that the threat of minimum sentences will do nothing to address the root causes of aboriginal offending. It will merely lead to more aboriginal people being sent to jail for longer and longer periods of time.

Why should Canadians care that our jails are becoming increasingly the preserve of aboriginal people? After all, if aboriginal people commit crimes, why should they be exempt from jail, the most serious sanction the criminal justice system provides?

To answer these questions it's helpful to return again to the decision of the Supreme Court of Canada in Gladue. When discussing aboriginal overrepresentation, the court said:

These findings cry out for recognition of the magnitude and gravity of the problem, and for responses to alleviate it. The figures are stark and reflect what may fairly be termed a crisis in the Canadian criminal justice system. The drastic overrepresentation of aboriginal peoples within both the Canadian prison population and the criminal justice system reveals a sad and pressing social problem.

Aboriginal overrepresentation speaks to the failure of the criminal justice system to address the root causes of aboriginal offending. The result of paragraph 718.2(e) and the Gladue decision has not been that aboriginal people have stopped going to jail.

Both paragraph 718.2(e) and Gladue speak of the need for restraint in the use of incarceration for everyone. In fact, it has been non-aboriginal people who have been the primary beneficiaries of these initiatives. A study by Julian Roberts and Ron Melchers showed that from 1997 to 2001 the rate of aboriginal incarceration rose by 3% while the rate of non-aboriginal incarceration decreased by 27%. Similar results have been found in examining the impact of sentencing changes in the Youth Criminal Justice Act. Despite specific admonitions in legislation, the judges need to look for alternatives for aboriginal offenders. It is non-aboriginal people who are seeing the greatest decline in incarceration rates.

Please rest assured that we are not urging that more non-aboriginal people be jailed, but it is vital that you be aware that the impact of moves to make the criminal justice system more punitive will fall disproportionately on aboriginal people.

Jail has proven itself to be singularly incapable of resolving the social problems that are at the root of aboriginal offending. More jail will be similarly ineffective.

These concerns lead to our proposed amendments to the legislation. We suggest that the bill give judges an option to not impose a minimum sentence in exceptional circumstances. Such a provision will go a long way to meeting objections that the law is unconstitutional and would allow judges to consider other sentencing provisions, such as contained in paragraph 718.2(e) of the code, in situations where to impose a minimum sentence would be clearly unjust in the circumstances.

For almost 20 years, royal commissions, judicial inquiries, parliamentary committees, and decisions at all levels of courts in Canada have urged that the problems of aboriginal overrepresentation be addressed. For every small step forward, we confront great obstacles pushing us back. Sadly, Bill C-10 is another example of a serious step back.

We urge this committee to move away from increasing reliance on minimum sentences. If we are serious about wanting to make our communities safer, we need to do more than lock people up. We need to ensure that there are programs in place in the community to address the root causes of criminal behaviour. We need to have programs in place in correctional facilities to do the same.

Thank you very much.

November 23rd, 2006 / 12:25 p.m.
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Conservative

Myron Thompson Conservative Wild Rose, AB

In reference to the campaigning during the election, you only need to look at Bill C-9 to see if there has been any change in attitude, and I think you will concur that there certainly has been.

I appreciate you. I just want to say how much I appreciate people who speak out strongly for victims. That is no reflection on what the witness of the other party.... I'm not reflecting on it in that sense. I know the gentleman is probably close to my age and has been around this country for a long time and has a lot of heartfelt thoughts for victims of crime. I'm sure he does, especially if he has grandchildren, etc. We all want to protect them.

I want to thank Mr. Muise for addressing this thing from the point of view that there's a public outcry to start protecting victims in this country, and I applaud you. And, yes, I'll charge expenses for that speech.

Thank you.

November 23rd, 2006 / 12:15 p.m.
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Director, Public Safety, Canadian Centre for Abuse Awareness

John Muise

Let me start by saying that like the chief and Minister Bryant, I agree that when dealing with any crime, including gun crime, there's a range of responses across the continuum. Clearly, one of them is legislation, and that's what we're talking about today. Obviously I support this legislation. I supported Bill C-9, the conditional sentencing legislation, as it was previously written, and I'm not happy with the result.

But having said that, I also support proper and lawful storage. I like the fact that people have safes in their homes where they keep their guns. We recognize legal gun ownership. I like the emphasis on those things.

Do I support either registration or licensing, or some form of a way of telling us, as a community, and particularly as police officers? Absolutely. I was a police officer for 30 years, and access to that information is good. I leave that to Parliament to sort out what that looks like, whether it's a registration system or a licensing system. As long as that information is accessible to the police, I would support that.

Because you've asked the question and I feel I need to answer in its totality, do I support spending $1 billion on a system that doesn't return $1 billion in terms of public safety, no. If there is something Parliament can come up with that is more cost efficient and still allows for some sort of registration or licensing, I would support that. Ultimately I do support some form of that.

I hope that answers your questions.

November 20th, 2006 / 4:05 p.m.
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Executive Director, Canadian Association of Elizabeth Fry Societies

Kim Pate

That's correct, but it's also true that most other jurisdictions have shorter sentences, particularly in the context we were talking about before. We were talking about mandatory minimum sentences also for very serious violent offences, and most of them also have mechanisms for what are often referred to as escape clauses. So if the judges see exceptional circumstances, they do not have to necessarily apply the mandatory minimum. Those kinds of exceptions are permitted, and that is something we don't have currently in our legislation for mandatory minimum sentences.

To go back to when you asked about the other areas that impact women, I didn't repeat it because when I was here for Bill C-9, I talked about it. But the other example of where we see situations is where women are attempting to flee violence and where the men who are victimizing them may have a cache of weapons themselves and they use one of those weapons. Under current legislation as well as the proposed, they could end up with sentences exceeding that which a judge may have given them, or exceeding what many of us may believe they should get if they are in fact defending themselves and their children, as they often are.

November 20th, 2006 / 3:30 p.m.
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Executive Director, Canadian Association of Elizabeth Fry Societies

Kim Pate

One of the main ones, in terms of the primary principles of sentencing, is proportionality. When we look at this bill, we see that this fundamental principle is not adhered to. In fact, we see it promoting something other than the least restrictive approaches to dealing with individuals who come before the system, with a particular focus I think on aboriginal people. We're seeing concerns in our organization about the increasing numbers of aboriginal people, particularly women, ending up in the system.

As I think you're aware, the same day we were presenting here on Bill C-9, October 17, the Correctional Investigator released information that had the shocking statistic of 1,024 aboriginal people per 100,000 being jailed in this country now. Considering the importance of adhering to existing sentencing principles that very much encourage looking at all of the circumstances of offences—the circumstances of the individuals accused as well as of those who are victimized—it's very important that we look at proportional sentences that can be adjusted, at situations where mitigating circumstances must be taken into account.

When we think about women in particular in relation to this bill and about some of the areas being introduced, particularly around constructive possession of weapons, we know the number of women who will be implicated as parties in these sorts of offences. We already know they're in the system now. This bill will likely increase the amount of time they will end up in prison because they are not willing or able, for all kinds of reasons, often having to do with histories of abuse at the hands of the men who are wielding the guns, for whom they may be hiding the guns, in vehicles or in homes that they also inhabit, and therefore they may risk other issues, in terms of their own safety, should they try to interrupt or interfere with that kind of constructive possession.... There are a number of examples we could use, but rather than dwell any further on those, we're both happy to discuss them more in the question period.

One of the things we see is that sentencing in the absence of such relevant facts is extremely problematic. This is exactly why the principles of proportionality, the provisions that were placed in the Criminal Code with respect to the need to focus on least restrictive interventions or least restrictive penalties, and the need to focus particular attention on issues for aboriginal people, will be interfered with by this bill.

We also see it as inconsistent, actually, with some of the positions taken by the government in other areas. For instance, the seeming allowance of the proliferation of guns that may be occasioned by the abandoning of a gun registry, yet the development of extensive additional penalties for prohibited weapons, does not seem consistent.

It is our respectful submission, therefore, that in the actions of this committee, the public would be best served by the withdrawal of this bill and not proceeding any further with mandatory minimum sentence provisions of this nature.

Thank you.

November 20th, 2006 / 3:30 p.m.
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Kim Pate Executive Director, Canadian Association of Elizabeth Fry Societies

Thank you very much, Mr. Chair.

And thank you very much to the committee for inviting our organization to appear and to present testimony before this committee with respect to Bill C-10. I'm here, as you've indicated, representing the Canadian Association of Elizabeth Fry Societies. I'm joined by one of my board members, who is also the co-chair of our social action committee, Professor Debra Parkes. She's also a law professor at the University of Manitoba. So I'm very pleased that she was able to join us as well, and thank you very much for inviting her.

I will skip over who our organization is because it was just a few weeks ago I was here when we were speaking about Bill C-9. But suffice it to say that our organization works with both victimized and criminalized and imprisoned women within the criminal justice system. Our agencies, our 25 members across the country, provide services that range from working with those who have been victimized to those who have ended up in the prison system. It's in this context that we offer our testimony.

Our testimony primarily focuses around a couple of areas, as you'll see from our brief. I won't repeat everything that's in our brief. I'll merely summarize to say that we do have concerns about Bill C-10. Our main concerns have to do with the extent to which we see much of what is being presented as contrary to the principles of sentencing that exist.

Proceeds of Crime (Money Laundering) and Terrorist Financing ActGovernment Orders

November 10th, 2006 / 12:20 p.m.
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NDP

Pat Martin NDP Winnipeg Centre, MB

Mr. Speaker, I am pleased to enter into the debate today on Bill C-25 on behalf of the NDP caucus.

I am going to draw on some of the comments made by previous NDP members in this debate earlier and during other stages of the bill. I note many of the thoughtful comments made by our justice critic, the member for Windsor—Tecumseh and our finance critic, the member for Winnipeg North, who analyzed the bill and added some helpful comments that I will try and summarize here.

I should note by way of introduction that the bill comes to us as one of a flurry of bills dealing with justice issues. There has been an entire suite of legislation in recent months, some of it good and some not so good. In the NDP's point of view, we believe that some of the bills go too far and some not far enough. I hope I will have time to develop this somewhat.

We believe that aspects of Bill C-25 do not go far enough given the worthwhile goals and objectives stated in the bill. This is one of those situations where the government of the day could have exercised even more authority to solve some of these issues.

Let me start with that one point that I have introduced to explain. Should the bill pass, this would be one of the few places in the Criminal Code where the reverse onus would be contemplated and allowed. This has been controversial in other aspects. For instance, we just finished debating Bill C-9 yesterday that introduced an element of reverse onus. Should individuals be convicted for a third time of an offence from a list of serious offences, the reverse onus would be put on them to prove why they should not be designated as dangerous offenders and locked up for life.

There were howls of derision in the House because the NDP had the temerity to raise the caution that we should only venture into this notion of reverse onus with our eyes open and with due diligence. We think we were justified in that respect and we are taking political heat as a result of it.

It was not a pleasant sight yesterday when we were debating Bill C-9. I was not proud at all of the tone of the debate that took place just because the NDP had the temerity to question the idea of “three strikes and you're out” and the idea of putting the reverse onus on individuals who are convicted to prove they are not dangerous offenders.

Bill C-25, the bill we are addressing today, deals with a reverse onus as well. This is one case where I think the Conservative government has gone soft on crime. I cannot understand why it did not go farther. Even though those members hurled abuse at the NDP for being soft on crime yesterday because we raised a question, in a more respectful way I ask them why they could not have gone tougher on crime in this bill. I will explain what I mean.

In the context of this flurry of crime and justice bills that we are dealing with, we have to establish the notion that crime does not pay. I would hope this would be one way to deter criminals from activities that we are trying to discourage. The prevailing wisdom and the common knowledge out there is that crime does pay.

An awful lot of bad people are getting away with an awful lot of things and living a very good life right under the noses of our police officers and law enforcement officers whose hands are tied. They may have darn good reason to believe that somebody is enjoying these luxury goods from ill-gotten gains from the proceeds of crime, but because the burden of proof is so onerous on our police officers and on our criminal justice system, it is rare that the proceeds of crime are actually seized.

Bill C-25 does suggest that in the event of money laundering and fundraising for terrorist activities or belonging to an illegal organization, the government can in fact seize bank accounts and cash assets from individuals and apply the reverse onus. I think that is laudable.

I would point out, though, that we could have expanded this notion to include more things than just the bank accounts. In the province of Manitoba we introduced legislation. It was defeated narrowly by the two Liberal members of the Manitoba legislature who would not allow it to pass, but we introduced legislation that was very broad and very sweeping. If a person was a member of a criminal organization and was convicted of a crime, the crown prosecutor could go to a judge who could then assess the material possessions of the criminal.

Let us say the person was a member of an illegal organization like the Hell's Angels and the guy was living in a $750,000 mansion with a tricked out Escalade in the driveway, two boats and a Sea-Doo, and all the tools and jewellery et cetera, the trappings of ill-gotten gains and crime. If that individual could not prove to the judge that the toys were purchased by earnings or by some legally obtained wealth, then we in fact could seize the property. The assets would be liquidated and the proceeds would in fact be dedicated directly to law enforcement, so that we can go out and bust more criminals. I thought that was a great bill and I thought that in the bill before us we could have explored some of those notions.

I note that the private member's bill from the Bloc Québécois in the last Parliament proceeded quite a way down the road before Parliament ended and the bill died on the order paper. I think Richard Marceau was the name of the Bloc member who is no longer a member so I can use his name and give him credit. That garnered a lot of support in the House. We thought it was a good idea.

This notion of reverse onus is not foreign to the NDP nor do we oppose it out of hand, but there was derision heaped on us yesterday for raising the idea that we did not believe reverse onus should be used in Bill C-27, the “three strikes and you're out” bill. We opposed it yesterday, but that does not mean that we oppose it all the time.

Some of the legitimate concerns about Bill C-25 that were raised above and beyond that observation from my own point of view were that it would put a burden on financial institutions to monitor, track, and take note of suspicious transactions or even overt exchanges of money that may indicate illegal activity. I think this is a necessary aspect of the bill. We have to rely on the cooperation of the financial institutions to alert us when these suspicious transactions take place.

However, the burden on smaller financial institutions may be quite onerous. I have an email from the director of the largest credit union on Vancouver Island, Mr. Bob Smits. Mr. Smits noticed that we were raising issues about the bill in the House of Commons and was monitoring it carefully.

He raised a concern that in a smaller financial institution like his, the current regulations, even as they exist today regarding tracking, the FINTRAC legislation, and the financial transactions and report analysis legislation have required his small credit union to hire an enforcement officer. He estimates that the cost of compliance with the current law to be over $100,000 a year.

If we compound that burden even further and make the obligation more onerous, we have to accommodate somehow these smaller institutions who want to comply with the law, but who have served notice that they are legitimately concerned that the burden will be passed on to them. They are asking that the government pay attention to the submission made by the credit unions at committee.

I am not sure how the submission was received in committee but I did not notice any substantial amendment in that regard. The only amendment I could find in my research for my speech today was a committee stage amendment put forward by the member for Markham—Unionville. The amendment stated that SIRC, the Security Intelligence Review Committee, established by section 31, “...shall undertake a review of the operations of the centre in each financial year and shall, within three months after the end of each financial year, submit the annual report to Parliament on those operations”.

That is just a mandatory review process, which is not unusual when we are introducing a bill of this nature. I am not sure we took into consideration the legitimate concerns of the Credit Union Central of Canada in its submission to the bill. I want to recognize today that the NDP did take note of CUCC's concerns and we tried to represent its concerns at every stage of the debate on the bill.

One of the points I highlighted in its submission is where CUCC states that “in the absence of compelling evidence of need, Credit Union Central is concerned that the proposed legislation is largely driven by the perceived need to make Canada's AML-ATF regime formally consistent with the new international financial action task force standards, rather than in response to any substantive threat arising from loopholes in Canada's current AML-ATF regime”.

I suppose CUCC is questioning whether better enforcement in support of the existing regime may have been adequate to plug the loopholes. These are the practitioners in the field who do not want us to pass legislation unnecessarily unless we can have a demonstrated need proven to them. They also point out, and we should take note of this, that they do not necessarily accept that the need is commensurate with the level of activity contemplated in the bill.

The one thing that I do take note of and support in the bill is that the bill does include the foreign currency exchange shops. I think this is a logical extension in terms of financial institutions.

I would also note that a lot of questionable activity can be shielded in the completely unregulated financial sector of the payday loan companies, many of which, in fact, offer this foreign exchange and foreign delivery of currency.

As we know, a lot of money leaves Canada every year, expatriated by people who are working in Canada and sending money to other countries. When the completely unregulated payday loan sector started to explode into our communities and started sprouting up like mushrooms on every street corner, we were very concerned. However, one of the things we have not given too much thought to is that one of the services offered by these payday loan outfits is, quite often, wiring money to other countries.

The wiring of money was normally done in a fairly regulated setting until these shops started popping up in every strip mall across the country, sometimes three, four and five of them in the same strip mall. I think we will need to pay better attention to the activity involved in that because questionable people have entered into that industry sector. When people can get 1,000% rate of return on their money, a lot of people are taking note and it is no wonder these little shops are sprouting up.

In one sting case done by the crown prosecutor for the province of Manitoba, they found that 10,000% interest was being charged by one of these outfits. I believe that is a better rate of return than a person can get selling cocaine. There is no other activity in the country where we can get 10,000% return on an investment, other than these payday loan shops, so it is attracting all the wrong kinds of people. I would suggest that might be one place that officials may want to really look for money laundering, illegal transactions, and bring these payday lenders under tight scrutiny and tight regulation.

I do acknowledge that payday loan legislation is pending in this 39th Parliament, and I welcome that.

This bill deals with the legislation governing money laundering as it exists today and tries to strengthen and improve the performance of the Financial Transactions and Reports Analysis Centre, or FINTRAC as it is known to the practitioners in the field.

FINTRAC, being an independent agency, does report to the Minister of Finance. It places obligations on certain individuals and entities to keep records, to identify their clients and to report certain financial transactions.

The second concern brought to our attention by the Credit Union Central of Canada is the obligation to report activity. First, the onerous burden that may be compounded by this legislation to track activity looking for suspect transactions, but also the obligation to turn in the names of member clients, otherwise seemingly innocent transactions may cross some line where a red flag pops up on a file, the institution would have no choice other than to report that individual. It could be someone who has been a member of that credit union for 20 years. We all know that credit unions are a lot more community driven than are some of the bigger banking institutions. It could put the manager of a credit union, who is a member of the community and who might be the coach of the local hockey team, in the difficult situation of having to turn in one of the parents of the children on that hockey team because of a transaction that was possibly innocent but set off a little red flag.

There are the privacy elements here that we must take into consideration and there is the awkwardness associated with that.

Bill C-25 seeks to improve and strengthen the performance of the Financial Transactions and Reports Analysis Centre. I come back to the point made by Credit Union Central that perhaps all that is needed is a more robust administration of the existing FINTRAC regime.

It would be irresponsible to speak to this bill without taking into consideration the projected costs.

As I see I have only two minutes left, I will restate two of the compelling arguments brought to our attention by people we trust, about Bill C-25, the Credit Union Central of Canada.

The budget for FINTRAC, as contemplated currently, is $64 million. It may be that more resources will be necessary to offset the impact of the costs of administering the further obligations under Bill C-25 for these smaller institutions. As a former activist in the credit union movement, I try to advocate on their behalf. Let us not put this added financial burden on struggling organizations that are trying to meet the financial needs of individuals in places where the banks have abandoned them.

Quite often, the credit union stuck with the tough work of providing basic financial services that the banks should have been providing if they were living up to their obligations under their charters. They have abandoned the inner cities. Credit unions have fallen in to take their place and this bill might add an unnecessary financial burden on them.

Criminal CodeGovernment Orders

November 9th, 2006 / 5:20 p.m.
See context

Regina—Lumsden—Lake Centre Saskatchewan

Conservative

Tom Lukiwski ConservativeParliamentary Secretary to the Leader of the Government in the House of Commons and Minister for Democratic Reform

Mr. Speaker, I have one comment to make on the whole issue of the opposition's soft on crime stance and one particular question for the hon. member from the Bloc.

The first thing I would comment on is that apparently the opposition members think it is an appropriate sentence to have criminals sit at home watching a 52 inch plasma TV stolen from a house that they just burnt down. That is exactly what these members are saying should be an appropriate sentence as opposed to Bill C-9.

I am absolutely appalled that he would stand in the House and say that for $26,000, that is the reason we cannot afford to designate somebody as a dangerous offender.

In our province there is a man by the name of Peter Whitmore who has just recently abused two 12-year-old boys. It is the sixth or seventh time he has done this. He was not designated a dangerous offender. Had he been so, he would have been in jail.

Why does that member not come to my province and tell the parents of these 12-year-olds that $26,000 is more than the value of a young child? Please come out.