Good afternoon, Mr. Chairperson.
Thank you very much for the invitation to appear before you today. My name is Tony Manconi, and I'm the Director General of the Charities Directorate within the Canada Revenue Agency.
With me is Alastair Bland, Director of the Review and Analysis Division, which is the area responsible for carrying out the charities directorate’s national security mandate.
Also from the Canada Revenue Agency, or CRA, is Stéphane Bonin, Director of the Criminal Investigations Division. I will be sharing my time with him.
We are pleased to be here today to answer any questions you may have regarding CRA's involvement with the Proceeds of Crime (Money Laundering) and Terrorist Financing Act, PCMLTFA, as FINTRAC discloses information to two distinct areas within the CRA.
When FINTRAC has reasonable grounds to suspect that information would be relevant to money laundering and also to tax evasion, it discloses that information to the CRA's Criminal Investigations Division. My colleague, Mr. Bonin, will speak more about that role in a moment.
In addition, when FINTRAC has reasonable grounds to suspect that information would be relevant to the risk of terrorist abuse of the charitable sector, it discloses that information to the CRA's Charities Directorate.
I would now like to provide an overview of the charities directorate’s general mandate, as well as its role as a national security partner in Canada’s anti-money laundering and counterterrorism financing regime.
Under the Constitution, the provinces have jurisdiction over the establishment, maintenance and management of charities. However, registered charities are afforded certain privileges under the Income Tax Act, including exemption from paying tax on income and the ability to issue tax receipts for donations they receive. It's because of these privileges that the CRA has been overseeing the conduct of charities since 1967.
The Charities Directorate is responsible for ensuring that registered charities meet the legal requirements for registration under the Income Tax Act. This includes ensuring that charitable registration benefits only those organizations that are exclusively charitable at law, and that charitable donations reach intended legitimate beneficiaries. We achieve this through a balanced program of education, service and reasonable enforcement.
In the course of its work, the charities directorate has been determining whether the registration system was being abused by individuals or groups having links to terrorist organizations. Various legislative developments have assisted in this endeavour.
The Charities Registration (Security Information) Act, the public security and anti-terrorism initiative, the PCMLTFA, and the Security of Canada Information Sharing Act, as well as consequential amendments to the Income Tax Act, have provided the CRA with the mandate and the ability to staff a dedicated team within the charities directorate, called the review and analysis division, focused on protecting the charitable sector from the risk of terrorist abuse. These statutory developments also permit the use of classified information for determining whether charities should be registered under the Income Tax Act, and have increased the CRA's ability to share relevant information with government partners, including FINTRAC.
While the Income Tax Act remains the primary authority for administrative decisions made by the review and analysis division about charitable status, disclosures received from FINTRAC under the PCMLTFA contribute valuable intelligence required to make informed decisions.
I now turn to my colleague, Stéphane Bonin, who will speak about the criminal investigations division of the CRA.