Canada-China Relations Committee on May 31st, 2021

[Christine Normandin, Bloc, Saint-Jean, QC]

Thank you.

[The Chair, Liberal, Geoff Regan]

Thank you very much, Ms. Normandin.

Now we'll continue with Mr. Harris for six minutes, please.

[Jack Harris, NDP, St. John's East, NL]

Thank you very much, Chair, and thank you, Mr. McGuinty, for coming to us tonight. I appreciate your work on NSICOP.

I'd like to talk a little bit about foreign influence in Canada with respect to criminal activity, particularly things like money laundering as it affects the activities in Canada of criminalized gangs, some of them with foreign influence connections. The estimates that you quote in your report indicate that there's an upper estimate of $100 billion of investment in Canada through money laundering. I would call it “investment” using the term loosely. It's most prominent in real estate and casinos.

These are the most publicly discussed domestic examples, but it's also been looked at by CSIS and the RCMP, and referenced of course in your 2018 and 2019 reports regarding a project called “Sidewinder” that was referenced in the paper that was produced by Anne-Marie Brady, who has appeared before us. She relied on the 1997 draft report between CSIS and the RCMP with the code name “Project Sidewinder”, which aimed to gather and analyze intelligence about efforts by the Chinese government and Asian criminal gangs to influence Canadian business and politics. That's a very serious subject, of course.

This leaked report, a 1997 draft, was in fact discredited by SIRC itself in 1999 and 2000, which said it didn't really meet the standards of professional and analytic rigour. They also noted that they revised the report, and a finalized version was issued in January 1999. For some reason, NSICOP in 2018 or 2019 doesn't refer to the finalized Sidewinder reports. Is that report available to NSICOP for its review? Was it aware of it? Did it ask for it?

[David McGuinty]

Mr. Chair, could I ask my director of operations and research to take a stab at that question? I don't want to get this wrong. That's a very pointed question about a single document.

[Sean Jorgensen, Director of Operations, Secretariat of the National Security and Intelligence Committee of Parliamentarians, National Security and Intelligence Committee of Parliamentarians]

Thank you, Mr. Chair.

The only thing I would say about that is that we didn't ask for that specific report. If we were to do so, I believe it would be available to us. There would be nothing preventing our getting it, but we didn't ask for it.

With respect to Ms. Brady, I understand that she did reference it, but when we referenced Ms. Brady's reports, it was in a much broader context and on the basis of much wider research and an analytic review that she conducted.

[Jack Harris, NDP, St. John's East, NL]

My concern, though, is that the idea of this money laundering and the criminal gang activity occurring in Canada to the extent that has been noted was identified as being related to foreign interference and the connection of foreign interference. Your report in 2020 doesn't even talk about it in terms of foreign interference. It talks about having some commercial influence and about perhaps inflating housing prices and putting houses out of reach of large segments of the population.

The only mention of potential trouble is a footnote to paragraph 90 that cites an article that says how Chinese gangs are laundering drug money through Vancouver real estate. However, there is no mention at all in your 2020 report about this having some Chinese government influence, which is the subject of the Sidewinder report in its revised form.

I'm wondering why it is that this would be missed by NSICOP in its reporting in 2020 when it made reference to it in 2018 and 2019.

[David McGuinty]

That's an omission I cannot address for you, Mr. Harris. I could certainly find out and get back to you.

I think the report, though, does talk about the resurgence of groups, how many of those are considered to be national security threats, and to what extent some of these groups are transnational. We talk about the fact that the RCMP is conducting a number of priority investigations related to transnational, serious organized crime. We talk about the limitations of FINTRAC's ability to track international monies that are coming into Canada for laundering.

I think we have tried to capture it as best we can, but on that particular point, unless Mr. Jorgensen has more information, I will definitely get back to you.

[Jack Harris, NDP, St. John's East, NL]

Yes. I only have a short time left, so perhaps I should ask a question.

Would NSICOP be interested in knowing the extent of whether or not there is government influence—Chinese government influence—in this, and whether this is actually being studied and has been studied for decades by the various security agencies? There seems to be a bit of a lack of thorough review of that. Would that be of interest to NSICOP for the future?

[David McGuinty]

I think it would be. I'm not so certain that it's a lack of thoroughness. We did tackle 29,000 pages of documents, so we did the best we could, but we certainly will come back to you. I will check with my team.

[Jack Harris, NDP, St. John's East, NL]

Thank you very much.

[The Chair, Liberal, Geoff Regan]

Thank you very much, Mr. Harris.

I will now go to the second round, which will have to be a little bit abbreviated as we finish at 9:30 p.m.

We will start with Ms. Stubbs for five minutes, please.

[Shannon Stubbs, Conservative, Lakeland, AB]

Thanks, Mr. Chair.

Hi, Mr. McGuinty. It's nice to see you again on this committee now.

Certainly, as you have pointed out in your comments today, as well as in the the 2020 NSICOP report, “[t]he threat from espionage and foreign interference is significant and continues to grow” and “China and Russia remain the primary culprits” and “the most significant long-term threats to Canada's sovereignty and prosperity.”

I guess I noted, though, that the 2018 NSICOP annual report also said:

China is known globally for its efforts to influence Chinese communities and the politics of other countries. The Chinese government has a number of official organizations that try to influence Chinese communities and politicians to adopt pro-China positions....

It cites wealthy Chinese businessmen, Chinese students, mobilized diaspora populations, political donations, demonstrations, and influencing Chinese language media. Certainly, Canadians are hearing more and more about the implicit, explicit and multi-layered threats to academia, to the political sphere, to research and technology, to science and to the scientific sectors.

I guess it's fair, I think you would say, for us to draw a conclusion that it's evident that threats to Canadians from China's Communist regime have continued to grow and to evolve.

Could you, for all of us, just highlight the highest priority measures that the government should implement to combat foreign interference from China and to protect the safety and security of Canadians? Even on the example of Operation Fox Hunt, you probably know that I have asked multiple questions about this issue. The United States has made several arrests, yet still in Canada, neither officials nor Canadian elected representatives can say that any of that is happening.

What are the highest priority things that the government should implement right now to protect Canadians?

[David McGuinty]

That's an excellent question, Ms. Stubbs. Thank you for that.

In the report in 2019 we lay out each of those really core areas—media influence, academic circles influence, political campaigns and politics influence. We've tried to break it down by sector, almost as you've enumerated, but we've also kept the number of recommendations in our 2019 report's review on foreign interference to a very small number—in fact, really two.

The recommendation is about this comprehensive strategy to counter foreign interference and build institutional and public resiliency. On page 109, in paragraph 297 of the 2019 report, we break it down. We talk about what has to be dealt with, sector by sector by sector: how it might be dealt with, including what the short- and long-term risks to Canadian institutions and the rights and freedoms posed by foreign interference are, and what the range of institutional vulnerabilities targeted by hostile foreign states is. It goes on to give a bit of a work plan for this pan-Canadian approach, which would be core to upping our game in this area.

The second major recommendation that I want to come to, with your forbearance or patience, is a recommendation that we've made twice in a row now to the government and the Prime Minister. That is that members of Parliament and senators should be briefed in detail on foreign interference activities to which they may be subject, immediately upon their swearing in and regularly thereafter. This is because, as one of your witnesses said in an earlier panel, many of us in elected public service life don't always understand what might be happening around us.

We've kept the recommendations down to two, and recommendation number 5, as it's called, is really a key breakdown, sector by sector.

[Shannon Stubbs, Conservative, Lakeland, AB]

Thank you.

Given that Australia has passed a rather multi-pronged, concrete policy approach to this issue, I'm wondering, and I don't know whether you can comment, whether you have any insight as to what the holdup is for Canada. Why is this taking, it seems, an extraordinarily long time, given that this has been going on since the nineties?

Also, in your work, for the people who say, as we've heard and you've said, that they feel they have no place to go—they go to the police, and they refer them to CSIS, and they go back and forth—do you have any insight into what exactly the barriers are and what the specific solutions are?

[David McGuinty]

On the first question, of speaking for the government, I'm really not in a position to do so, except to reference Minister Blair's 18-page document sent out to all MPs in December.

[The Chair, Liberal, Geoff Regan]

Mr. McGuinty, I'm sorry; Ms. Stubbs' turn is up. I regret and am sorry about that.

Now I have to go on to Ms. Yip, for five minutes, please.

[Jean Yip, Liberal, Scarborough—Agincourt, ON]

It's nice to see you here, Mr. McGuinty.

This is your third annual report, and this year's version isn't the first to highlight threats posed by foreign interference. Over the past year, Canadians have been seeing and hearing more from CSIS about this issue than ever before.

We've heard recently that while a former CSIS director in 2010 sounded the alarm on foreign interference by the Government of China, the public safety minister called the decision regrettable and the PMO admonished the CSIS director for doing his job. Last year, CSIS contacted more than 225 entities across Canada and briefed at least 2,000 Canadian stakeholders.

In your opinion, what do recent efforts by CSIS to raise awareness say about the level of seriousness granted to this issue?

[David McGuinty]

I think the committee would say that it's encouraging that CSIS and its director are reaching out to engage more openly—giving keynote speeches, explaining the landscape, explaining the risks, and the magnitude of some of these threats and the magnitude of the opportunity to get it better for Canadians: protecting their rights, for example.

In our 2019 report, however, we also are very open and very transparent and objective. The committee insisted on putting in the areas where we're falling short in engaging with Canadians and where we're falling short in engaging with provinces, universities and institutions to give them more information about what is happening. That is rife, at the back end of our foreign interference review chapter in the 2019 report, a copy of which I hope you have. I think we've been very transparent and objective in pointing this out.

[Jean Yip, Liberal, Scarborough—Agincourt, ON]

Where have we been given more information for the universities?

[David McGuinty]

My understanding—and we've documented this in the report—is that CSIS regularly meets with university administrators to walk them through some of the risks. I would say that there's work to be done in this area. I think, as I said earlier, that with the decision by the Province of Alberta to cease all of its scientific research relationship with China, if I understand the announcement correctly, the administrators and the academics there are trying to figure out the best way forward to deal with this. They're certainly going to need some assistance and help as they wrestle it to the ground.

[Jean Yip, Liberal, Scarborough—Agincourt, ON]

In your report, you also noted that there are many threats to our national security, that the landscape is changing, and you devote significant attention to right-wing extremism. You note that actors are active online with 6,600 channels, pages, groups and accounts; and Canadians are sometimes more active than their U.S. or U.K. counterparts. How serious is this threat, and what can be better done to address it?

[David McGuinty]

I would say, Ms. Yip, that the committee concluded that between 2018 and 2020 this was the single greatest difference in the survey, in the compendium of threats that we produced for Canadians. This new process we started was the only publicly produced, publicly available overview of the main national security threats produced by the Government of Canada. The biggest change we've seen from 2018-20 is this growth in IMVEs and in this incel, this involuntary celibate movement. It is very worrisome. We've seen, for example, serious increases in neo-Nazi groups. They are active and growing. Of course, a number of them have since been listed by the Government of Canada as terrorist entities. In fact, four IMVE groups have been included by the government, which is a good start. We've tried to lay this out so people understand.

Of course, Mr. Chair, through you, we've also indicated to Canadians that the pandemic has had a profound influence on driving more of this activity underground. It's led to an uptick in this activity, probably because so many of us are home-based, or our ability to move about and take on more active lives has been constrained.

[Jean Yip, Liberal, Scarborough—Agincourt, ON]

The listing of those organizations, is that part of the terror code listings process? Could you just talk a bit about that?

[David McGuinty]

It is, and the government on February 3, I think it was—in February 2021—listed 13 new groups as terrorist entities and reviewed seven others. I know, through that process, that four groups—the Atomwaffen Division, The Base, the Proud Boys and the Russian Imperial Movement—have been now classified as terrorist entities.

[The Chair, Liberal, Geoff Regan]

Thank you, Ms. Yip.

Ms. Normandin, you have the floor for two and a half minutes.