Finance Committee on March 31st, 2015

[Dr. Christian Leuprecht]

If I may, I will answer in English to be more specific.

From a data mining perspective, it's inherently important that we base what we do on adequate risk-based assessments that are firmly grounded in evidence. There is too much investigation that happens on someone's best experience or best hunch, and there's too little in terms of the actual risk models.

As Mr. Brison pointed out, there's always the risk of being perceived as targeting ethnic communities. What we actually need are proper data-driven models to demonstrate that we are not targeting any one person because of religion or background or area of travel, but because we have an effective risk-based model.

I'd be happy to share with you some of the publications that we've done, including a publication that's about to come out on risk-based modelling within Correctional Services Canada, with a very large data set within Correctional Services.

Part of this is a challenge of not just risk-based modelling, but that we have some agencies that are more research-based than others, so the research cultures, and being able to have departments and agencies that are then driven by that research, rather than inductively by people's investigative hunches.

There's a whole institutional culture issue that's separate from actually being able to develop the adequate proper models. We don't, for instance, have a very good way of currently sharing data with researchers, something which the U.K. and the U.S. have done much better.

This is not to say that government analysts aren't good at what they do, but inherently, there are some things we can do in the academic community with some of our algorithms and methods that are perhaps a bit more advanced.

[The Chair, Conservative, James Rajotte]

You have 30 seconds left.

[Raymond Côté, NDP, Beauport—Limoilou, QC]

Mr. Therrien, in its latest annual report, the CSIS review committee said that it was receiving information on CSIS activities with significant delays. That seems dysfunctional to me, and I think you have already noted that yourself. Considering the potential increase of the powers exercised by the Canadian Security Intelligence Service, it's fairly obvious that the committee will be completely bypassed when it comes to monitoring those activities.

[Daniel Therrien]

I have no particular opinion on its capacity to analyze the information, but there is no question that it will receive much more information.

[Raymond Côté, NDP, Beauport—Limoilou, QC]

Thank you.

[The Chair, Conservative, James Rajotte]

Merci, monsieur Côté.

Mr. Adler, please, for your round.

[Mark Adler, Conservative, York Centre, ON]

Thank you all for being here today.

I want to begin with Mr. Leuprecht.

Sometimes fact is stranger than fiction. I don't mean to be glib about this, but are we looking at something like we see in the James Bond movies, where there's an organization like SPECTRE operating, or in the old mob movies where we see them all sitting around a conference table talking about the different revenues they're bringing in from the different territories? Is this more a business than it is an ideological issue? What is at the core of all of this?

[Dr. Christian Leuprecht]

Can you clarify, is this in regard to a terrorist organization?

[Mark Adler, Conservative, York Centre, ON]

Yes, terrorist organizations. We need to be following the money here, right? This is about money.

[Dr. Christian Leuprecht]

Inherently there are always going to be financial motives. I often compare security to a bit like studying theology: there's a whole lot of propositions and very little evidence to support any of them. As an academic, my work has always been about getting concrete research and data behind this. As I point out, some of the links are more tenuous, or more poorly understood, than some individuals put forward.

[Mark Adler, Conservative, York Centre, ON]

The network of all of this; it's like a spider's web, isn't it? The more layers you peel back of this onion the more layers there seem to be. It's all as you said, kind of tenuous with links to to this and to that.

Are we forever going to be playing catch-up, or are we ever going to be able to get ahead of this, in your estimation?

[Dr. Christian Leuprecht]

I think one important way of getting ahead of this is that we need within our own government on the security sector a comprehensive professional development program. The only department in the Government of Canada that has a cradle-to-grave professional development career plan is the Department of National Defence. We need likewise on the security side for all the security agencies so we can professionalize this entire apparatus. I think Canada does not get enough credit for what it does on capacity building, but we're only one country. Our international collaborations here are very important in staying ahead of the game, rather than always playing catch-up.

[Mark Adler, Conservative, York Centre, ON]

I understand. Thank you.

There's so much area I want to cover, but let me jump to another topic here.

Organizations that we see on university campuses, like BDS and movements like that, seem to be very well-funded slick organizations. Where are they getting the funding from?

[Dr. Christian Leuprecht]

I think there's inherently a challenge of being able to track all the funding, but we do know that both organizations and governments are active within Canada in trying to build certain types of sympathizing organizations. Inherently, university campuses are an attractive place to build that sort of sympathizing and recruitment source.

[Mark Adler, Conservative, York Centre, ON]

The money that's coming to fund these organizations, is it foreign sourced, or is it domestic sourced?

[Dr. Christian Leuprecht]

I'll be happy to share some documentation with you on that, without having to comment in public on it.

[Mark Adler, Conservative, York Centre, ON]

Thank you.

I want to follow up with Mr. Tupman.

You talked about the accounting profession. We have this impression of accountants as being rather cerebral and boring kind of people, but I was intrigued by your comment that we should be paying more attention to the accounting profession. Could you speak a bit more about that?

[Prof. Bill Tupman]

We know that in the areas where the al Qaeda offshoots and the Islamic State operate, one of the ways in which they fund the operation is by asking for a per cent of turnover from the individual businesses within those areas, and there are teams of accountants who go into the businesses and work out what their annual turnover is. This appears to have come out of al Qaeda's operations back in Afghanistan after an Egyptian ran off with $10 million from the central fund. From that moment onwards, they've gone for auditing and accounting, and as they developed a team, that team has gone out and looked at other branches of the organization and estimated what their turnover is so that if you signed up to al Qaeda, whether it be al Qaeda in Yemen, al Qaeda in Mali, or whatever, you are supposed to repatriate money to the central organization. That money is audited. That money is accounted for. Those accountants will also look at the companies operating within the area.

What I'm trying to say is, the relationship between organized crime and terrorist organizations over a certain size needs to be understood in the same sort of way that organized crime can sometimes just be another business. It's just an illicit business and it's expected to pay its share of turnover as a revolutionary tax, or whatever you want to call it, in the same way as legitimate businesses.

If you're interested in this, just this week my colleagues and I produced a special issue of the journal Global Crime, which covers a number of case studies in different countries on the interface between organized crime and terrorism. We've done quite a bit of work on this and encouraged other people.

[The Chair, Conservative, James Rajotte]

Professor, if you'd like to send that to the clerk, we'll ensure all members get that. That goes for any of the witnesses here today. If you have any additional information, we will ensure that all members get it.

[Prof. Bill Tupman]

Sure.

[The Chair, Conservative, James Rajotte]

Thank you, Mr. Adler.

We'll go to Mr. Mayes, please.

[Colin Mayes, Conservative, Okanagan—Shuswap, BC]

Thank you, Mr. Chair.

For our guests, I'm just filling in today so maybe my questions won't be quite as informed as those of my colleagues.

One of the things that strikes me is...how they track my money is through accounting and reporting, and then the other one is the banks and the transactions.

I just wondered if there is a centre of financial intelligence where there is some forensic accounting and a framework of reporting for banks internationally, and even with credit cards, for instance, whether a transaction goes to a certain individual and the red light comes on and says that the person is a person of interest, or whatever. Is there any way there could be a framework that could be put together to monitor and better catch these people who are financing terrorism internationally?

Mr. Kennedy, do you want to answer first?

[Paul Kennedy]

That was the whole purpose for the creation of FINTRAC here in Canada. There's an obligation upon banks and these financial institutions proactively to look at, in this case, transactions of $10,000 or more, and for various criteria in those training programs put in place. When they look at that, then they ship that off to FINTRAC, which is under the Department of Finance, and they do financial intelligence analysis to ascertain if these are suspicious transactions. They have, clearly, the expertise there through accountants and so on, and they then take that, as I pointed out, into actionable intelligence to share with CSIS and with the RCMP, as well as with provincial and municipal police forces in Canada who share information with them.

They do that analysis that you're talking about. That's a partnership between the public sector and a government institution, financial intelligence—

[Colin Mayes, Conservative, Okanagan—Shuswap, BC]

I'm talking about transactions globally. They're not really financing maybe terrorists within Canada; they're financing—

[Paul Kennedy]

There are agreements between FINTRAC and other—