Declaration of Emergency Committee on May 3rd, 2022

[Isabelle Jacques]

I would also add that the event that occurred leads us to wonder how those cryptocurrencies are used to fund illegal activities. That's something that became clear during these events.

[Gwen Boniface]

I'm almost loath to open this subject again, but in terms of internal reviews, from FINTRAC's perspective, how would you normally do an internal review of a particular week of unusual activity or such?

I'll give you the context. In policing—that's my background—if you're generally involved in an incident, you would have an automatic review that would take place to look at all the steps that were taken and what may or may not work in the future.

Would you normally build that in? I fully appreciate that some of these ongoing processes may inhibit the willingness to do that.

[Barry MacKillop]

The review is simply, for us, how agile we can be, how we can move quickly and reallocate resources quickly, how we can adapt our technology to search for particular keywords, for example, in suspicious transactions and those kinds of things. Yes, it was almost like a unicorn event, but it wasn't so new for us in intelligence that we'd have to focus on something.

We had the same thing with sanctions. We've had the same things with other events that have happened in the past, where we simply moved the resources and if we needed to, we would go 24-7, depending on what the event was. If it were terrorist financing or a terrorist event taking place, either in Canada, somewhere in one of our neighbouring countries or a Five Eyes country, we would end up going 24-7.

We have done this before and there wasn't an official review. We simply adapted processes and approaches that we had used in the past that had proven to be very successful, and I'm sure will continue to be successful in the future as we move forward.

In terms of the suspicious transaction reporting, it was essentially the same type of analysis and review, albeit we would have to make sure that we were applying our threshold appropriately and ensuring that there's no simply defensive reporting being filed, but we do that on a regular basis anyway. We'll continue to do that going forward.

[Gwen Boniface]

Thank you.

Thank you, Mr. Chair.

[The Joint Chair, NDP, Matthew Green]

Before we go on to the next round, I'll ask Monsieur Fortin to take the chair for this last round. Otherwise, Senator Boniface can. I need to step out for a minute.

[The Joint Chair, Bloc, Rhéal Fortin]

Okay. I'll take it from here.

Who have we got to?

Senator Carignan, you have the floor.

[Claude Carignan]

Thank you, dear colleague from the barreau des Laurentides.

My question is for Ms. Jacques.

Ms. Jacques, I'd like you to tell us a little about the reaction of the banks.

Our sources are friends from the banking community, who tell us that they weren't very happy and that the instructions, or the application thereof, were not clear. Discussions with the government were needed to try and get some guidance with respect to enforcing the freeze order.

Can you tell us anything about this?

[Isabelle Jacques]

I know that the situation took some people by surprise, because no one knew anything about this order until they were able to read it.

That's why we very proactively contacted various financial institutions to answer any questions they had, to ensure that they properly understood the implementation process, and also to see whether we could answer some of their questions.

As the financial institutions are legally responsible for implementing the order, we did not issue guidelines, but did everything possible to try and answer their questions. We regularly held discussions with many of them.

Some of our colleagues truly appreciated our discussions to try to help them, to the best of our ability, while understanding that there were limitations, because we were not responsible for implementing the order.

[Claude Carignan]

What were the main questions? What were the most important subjects, or those raised most often by the banks?

[Isabelle Jacques]

I believe the banks were initially trying to understand the information, which might possibly be shared with the RCMP. I know they held discussions with them, but we were not involved.

The banks also wanted reassurance about the fact that there would be no negative repercussions. They were going to do whatever they could to try and carry out the review.

They definitely wanted to make sure that they complied with the order, as written, and ensure that it was implemented.

[Claude Carignan]

What sorts of negative repercussions were they afraid of?

[Isabelle Jacques]

We told them that they would have to carry out and submit their risk assessment, and that we did not expect them to be able to find absolutely everyone identified, and that if they were missing a few people when they did their assessment, there would not be any negative repercussions. We said that it was up to them to perform the assessment on the basis of the information they were receiving and on information they might be able to find using their own software.

[Claude Carignan]

Beyond the guidelines, of which there were none, according to what you're saying, were there any written exchanges with the banks?

[Isabelle Jacques]

There were no guidelines, but the bank certainly submitted reports, as I mentioned earlier.

Apart from that, I don't think there were any. I could ask my colleague…

[Claude Carignan]

Can you check whether there were any written exchanges…

[Isabelle Jacques]

Yes, I can look into that.

[Claude Carignan]

...with the institutions subject to the order, and could you send us a copy of these exchanges?

[Isabelle Jacques]

Yes, and I'm going to Mr. Brazeau now.

[Julien Brazeau]

Apart from the information about the number of accounts that were frozen and discussions concerning requests for meetings, there were no other written exchanges of information.

[Claude Carignan]

Were notes taken at these meetings?

[Julien Brazeau]

We can look into whether any notes were taken, but most were just everyday discussions.

[Claude Carignan]

Okay. If any notes were taken, can we have a copy?

[Julien Brazeau]

We can look to see what we have and work with the Privy Council about giving you any of the documents.…

[Claude Carignan]

At the moment, I'm talking about the finance department, not the Privy Council.

[Julien Brazeau]

As it's a matter of disclosure, we will have to comply with the processes established with the committees to provide this information.