Finance Committee on April 30th, 2015

[Edwin Black]

First of all, it's not just the United States that's involved; it's also Europe and charitable organizations worldwide. These charitable organizations do not work on an A to B routing system. When charitable organization A gives money to charitable organization B, that then goes to charitable organization C, and then goes to non-charitable organizations and operations. For instance, if you had money going from A to B, and it ended up at the Union of Good, headed by Sheik Qaradawi, that's the chief Hamas charitable organization. So it's going there.

There's the Ministry of Social Affairs in the Palestinian Authority. I hear everybody here talking about criminals, but that's the wrong word. You need to talk not about the criminals, but about the politicians. You're nibbling at.... one of the colleagues here spoke about $150. That's not the money we're talking about. The Ministry of Social Affairs, which interacts with all these charitable organizations, did an internal audit and found that it had given financial assistance in 13,351 cases to terrorist activities outside of Palestine. That's anywhere from Tokyo to Toronto. That was approximately $20 million. When you start creating an elaborate infrastructure to monitor $1,000 here and $10,000 there, that's the little stuff. The big stuff is the $450 million a year that the U.S. is giving. I think Canada is giving upwards of $66 million, through various non-governmental entities or organizations, or the UN. Naturally the UN, especially through UNRRA, is providing massive support for terrorism. These are intertwined

I'm happy that you have an elaborate infrastructure to try to figure out who is sending out $150, but if you really want to go to the centre of this financing, you need to go to Brussels, Washington, and other capitals, where the taxpayers and their representatives do not know they are funnelling millions of dollars to terrorism every day.

[Dave Van Kesteren, Conservative, Chatham-Kent—Essex, ON]

I wonder if you could clarify, or maybe you could just give us your opinion. I want more than your opinion, but your evidence.... I think about organizations, and we all support charitable organizations. I like to support Samaritan's Purse, for instance, and probably many of us do.

Those aren't the organizations we're talking about. They're not funnelling money to the terrorists. Aside from the things you're talking about, I suspect the ones that are suspect are the ones that are directly involved in raising money for terrorists' activity.

Do I have a misconception there?

[Edwin Black]

I would say that the charitable organizations are indirectly involved in supporting it. They're interactive. Since they all work with the Ministry of Social Affairs and other UN bodies, it is very common for someone on the inside, especially with Hamas, to recommend an individual go on a payroll. There were some 80,000 phantom employees, so that's how that's done.

These prisoners, these terrorists who are getting monthly stipends, each has a government title: a clerk, an undersecretary, a corporal.

So when you here in Ottawa get a report that you're spending money to support an organization and these are the clerical jobs, those clerical jobs are people who have slit the throats of infants and who are convicted terrorists. Everybody knows this.

What I'm telling you now is not some dark secret that I figured out in a café because I met someone. These are the known published materials of the Palestinian authority. So continue spending your time on trying to track down the $150 payment that's going, but more important is the $450 million payment that is infused all throughout the various entities of the Palestinian Authority and the Martyrs Establishment, which is the worldwide funder of these terrorist activities.

After my time I'll be happy to share with you further.

[The Chair, Conservative, James Rajotte]

Thank you.

Thank you, Mr. Van Kesteren.

We'll go to Mr. Adler, please.

[Mark Adler, Conservative, York Centre, ON]

Thank you, Chair.

I do want to begin first of all with Mr. Carter.

You had indicated earlier in a question that you were not aware of any charitable organization that had had it status withdrawn?

[Terrance Carter]

No, the question was if any had become a listed entity. In relation to charitable status, that's a totally different matter.

Just to clarify, lots of charities lose their charitable status, and some of them lose their charitable status because of questions concerning involvement in terrorist funding, but that's different from the question that was asked.

[Mark Adler, Conservative, York Centre, ON]

Okay, thank you.

Mr. Black, yes, what you're talking about is a huge issue: public money, taxpayers' money going to fund these terrorists.

Can you address any of the private side of things, the activity of these terrorist organizations here in Canada who actively raise money from the public? Do you know how much that would be, how active these organizations are, and who they are? Can you just run with that please?

[Edwin Black]

I can't give you specifics on Canada, because I was given only a couple of days' notice to come here, but I can tell you that some of the same organizations that are supported, for instance, by the New Israel Fund in the United States, which has a Canadian office and also a Swiss office—I'm not sure why an American charity working in Israel needs a Swiss office—and other organizations such as Adalah and B'Tselem are also getting money from the Welfare Association of the Islamic Bank and the NGO Development Fund, which are controlled by Iran, and Saudi Arabia, and other countries in that neck of the woods. So what is it that these organizations have in common with Iran and charitable organizations?

When I did my original investigation for “Funding Hate”, on the Ford Foundation, which resulted in them dismantling their entire funding operation for racist NGOs, I found that they were giving millions and millions of dollars to support the anti-Semitic and terrorist-supporting organizations at the Durban conference in South Africa, and ultimately they had to establish rules that none of the grantees could allow their money to be commingled or to support the terrorists.

So once again, it's an impossible task for bankers to track the money going from organization A to organization B. Maybe they are registered NGOs or 501(c)(3)s, which is what we call charitable organizations in the U.S. What happens on the ground when they are funding guys who are travelling to distant locales to explode themselves, when they are taking care of families, when they are putting people on the payroll? You need to examine the root problem and the infrastructure. The paymaster, the central bank that is dealing with all of these moneys—the little moneys from Canada, and the giant moneys from Qatar, and the EU, and the United States—is the Palestinian Authority, and that is not denied by them. They have their known laws, they defend those laws, and they say they are in the right.

All of the numbers I'm giving you, about $20 million and 13,000 recipients, are from internal documents. People said this is charitable, but they came back recently and said, “Don't insult our warriors. This is not charity. This is their salary”. And they used the Arabic word ratib, and ratib means salary.

[Mark Adler, Conservative, York Centre, ON]

Last year we had a case here in Canada. A few years ago, first of all, the Muslim Association of Canada had their charitable status withdrawn because they were found to have been raising money, $300,000, to send to Hamas. IRFAN-Canada last year raised $14.5 million that we know of, which was sent to Hamas, and they also had their charitable status withdrawn.

Could you talk a bit about some of the organizations you're aware of in the States that have activities here in Canada that are...?

[Edwin Black]

I can't give you the specific names.

[Mark Adler, Conservative, York Centre, ON]

Talk about the U.S. then.

[Edwin Black]

I can tell you that we have organizations in the U.S. that are funnelling money to things such as the Holy Land Foundation, which has been put out of business, and to other charitable organizations. It's the end-game recipients who make the difference. We've had restaurants in Detroit that have been shut down for passing money to terrorist organizations. There was one called La Shish. It had very good food.

It's very common for ad hoc charitable organizations.... I'll give you an example. There is an NGO in the Palestinian Authority called the Prisoners' Club. The Prisoners' Club is specifically designed to make sure that the Ministry of Prisoners prioritizes every dollar it gets from any source to pay prisoner terrorist salaries before it pays for welfare or infrastructure.

Thank you.

[The Chair, Conservative, James Rajotte]

Thank you .

Mr. Carter, just very briefly on this, please.

[Terrance Carter]

I just wanted to clarify one matter. A gentleman said that the Muslim Association of Canada had its charitable status revoked, and it hasn't. So I just wanted to clarify that.

[The Chair, Conservative, James Rajotte]

Thank you.

I wanted to follow up with the time remaining on a couple of issues.

First of all, the Canadian Bar Association. And Mr. Carter, you talk about “Made in Canada” guidelines that will allow charities that wish to be compliant to have clear parameters with what they need to do and what they should not do in order to comply with Canada’s anti-terrorism legislation

If you go to the CRA website, they actually have a checklist for charities on avoiding terrorist abuse. It's quite substantive. It's linked to all of the links to public safety. It's a series of questions for charities to follow. It seems to me this is what you'd be requesting. Is there something beyond this that the two of you would want?

[Terrance Carter]

Well, thank you, Mr. Chair, for the question.

Certainly the checklist is a step in the right direction. It was introduced in 2009, updated in 2010, so we certainly applaud CRA for having that in place. But it's not adequate in itself and it's certainly not what—

[The Chair, Conservative, James Rajotte]

What would you add?

[Terrance Carter]

When you compare it to the FATF guidelines, and if you take a look at the U.S. Treasury guidelines, at the Charity Commission of England and Wales, they have much more comprehensive terms.

What you have is a very short list that does not give justice to the complexities of what's involved with the anti-terrorism legislation. It asks questions such as, do you have a good understanding of the background and affiliation of your volunteers? That's a question. How do you do that? How do you implement that on a practical basis? Do you know who's using your facilities and your office, and your telephone and fax, and what they're saying? How can you possibly take that from a practical context and put that into meaningful terms of reference?

For clients, we have prepared long policies—some 27 pages—trying to put that into context. What would be much better would be for CRA to work with the charitable sector to come up with something practical so it's not just the questions, but rather recommendations about what needs to be done similar to what's been done in the U.S., similar to the international FATF, and similar to England and Wales.

[The Chair, Conservative, James Rajotte]

So those are all good examples. in your view, then, for Canada to look at for a model?

[Terrance Carter]

Yes.

[Samuel Schwisberg]

We would concur with that.

We have procurement policies in place that we've developed because we have in-house lawyers doing them. We have all kinds of policies dealing with due diligence, how you check out organizations. You have to have a screening policy in place for volunteers and staff. All these are detailed policies that require a lot of expertise, and a checklist like this just doesn't give you sufficient detail.

[The Chair, Conservative, James Rajotte]

I appreciate that very much.

So the next item I want to go on to is with the two representatives from the banking sector.

Mr. Donovan, you concurred with the point by Mr. King to allow for greater information sharing among Canadian financial institutions, as well as between FINTRAC and reporting entities. But I think you said in response to a question that it's challenging getting FINTRAC to get the information back. Did I hear that correctly?

[Michael Donovan]

On a tactical level, Mr. Chair, they're actually forbidden under the law to be provide us details on the information we've provided them.

[The Chair, Conservative, James Rajotte]

So you not only want greater information sharing between Canadian financial institutions, but also between FINTRAC and them on a go-forth end basis?

[Michael Donovan]

That's right.