Good morning. Thank you for inviting me to appear before you this morning.
I'll talk about context, problems, and what to do.
First is the distinction, of course, between terrorist financing and money laundering. The challenge with terrorist financing is that much of the money is legal and it's used for illicit purposes. I have several documents here that I didn't enter into exhibits because they're not translated, but I'd be happy to share them with the members. One is an empirical study that maps some of the networks to show that financing and recruitment networks are very different and so they require different strategies. We're a diverse country, so there's a lot of interest by various forces around the world to try to obtain money in Canada. That's well documented. It's a long-standing issue dating back as long as the IRA, but also with regard to Sikhs and Tamils.
We have a financial tracking agency, a financial intelligence agency, that does a terrific job by all accounts, but it's extremely difficult to extract any sort of intelligence from that agency. All you need to do is to talk to other agencies around town. Trying to get anything out of FINTRAC is exorbitantly difficult. We have an obligation, under UN Security Council resolutions 1373 and 1624, and in the 2014 resolutions 2178 and 2195, to do a lot more about terrorist financing. I would remind the committee that those are chapter 7 resolutions, so they are binding on all members of the United Nations.
The problems in particular are intelligence sharing by FINTRAC and coordination issues. I have an article here of empirical survey evidence to demonstrate that there is a significant amount, albeit small...but we can demonstrate a significant amount of sympathies to finance such organizations within Canada. This is published peer-reviewed work.
As was pointed out, there is a significant delta between what happens empirically in Canada and the actual convictions. In terms of extraterritorial convictions, we don't have any, as far as I know, with regard to money laundering. We don't have any that I know of with regard to tax evasion. We only have one case, as far as I know, with regard to terrorist financing. That dates back to 2010. That case was essentially like taking candy from a baby, so I wouldn't consider that one a particularly great success.
We know what the Hezbollah networks look like, but it seems we have great difficulty doing anything about them. We know that within the RCMP we lack the skill set to do complex financial investigations. As was just indicated, there's a serious challenge here with regard to building the professional development and skill set capabilities to actually prosecute. We can survey everything that happens in terms of financial intelligence, but we seem to have a great deal of difficulty doing anything about it. Just changing laws won't do much if we can't actually change the capacities.
We have the problem of morphing violent extremist organizations. I've submitted to the committee a brief paragraph with regard to north and west Africa. It shows how organizations regularly change their names. We have great trouble in our listing regime actually keeping up with these organizations as they split and as they change their names, so we're constantly playing catch-up. It takes us years to catch up. As far as I know, the Taliban weren't listed until 2012 as a terrorist entity in this country.
We have organized crime connections to terrorism. I have submitted, without going into detail, a four-page note on that particular issue. It's a bit more tenuous and a bit more difficult to demonstrate empirically, and yet we do have evidence out there. I list that in the submission. There's the risk of extortion, as we know from Tamil communities. There are export flows that inherently support violent extremist organizations. I've documented that in a separate peer-reviewed article with regard to the Canada-U.S.-based terrorist networks. Most of them don't try to do bad things in either of our countries; they try to export a whole bunch of stuff to the rest of the world. We have an obligation to make sure that we do our part, that we don't inadvertently support terrorist activities elsewhere.
There's the great challenge of microfinancing. People are trying to raise a couple of thousand bucks to get on a plane and go abroad. What we have is a changing picture with regard to terrorist financing. However, the terrorist financing today, with regard to ISIS, as was mentioned, is now largely either state-sponsored and/or own-source revenue. There's less going on in terms of people actually trying to raise funds here directly except for the opportunity to go overseas.
What needs to be done? We need to think about the listing regime and making our listing regime much more efficient. I have specific propositions with regard to that.
We need to perhaps think about listing specific individuals abroad, but that gets us into the problem that even terrorists go to the dentist. Just because you transfer money to an individual abroad who might be listed, it might be difficult to demonstrate that the money is used for terrorist purposes.
We need to learn a lot more from our allies. The United Kingdom has a system whereby they essentially can search passengers on an entire plane, yet in Canada the CBSA has no outbound mandate. The RCMP's jetway activity is only land-based, and the RCMP doesn't have any money dogs. Again we have these coordination issues.
I think we need to get rid of the threshold for electronic funds transfers altogether. I can demonstrate to you mathematically that it makes no sense to have these thresholds, because it vastly increases the number of false positives. We should either have it set by ministerial discretion or by FINTRAC rather than picking arbitrary thresholds of x thousand dollars.
What do we need to be looking at? In sum, we need to be looking at the disconnects within our own government. We need to be looking at the motivations and at why we don't have more motivations to actually prosecute in this country. We need to be looking at the methodology, and in particular learn from the methodology that many of our allies have implemented. Besides the U.K. example, I can give you a dozen other examples of how other countries go about some of these measures.