Evidence of meeting #27 for Foreign Affairs and International Development in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was measures.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

Andrea Charron  Assistant Professor, University of Manitoba, and Director of the Centre for Security Intelligence and Defence Studies, Carleton University, As an Individual
Sue Eckert  Adjunct Senior Fellow, Center for a New American Security, As an Individual

3:35 p.m.

Liberal

The Chair (Hon. Robert Nault (Kenora, Lib.)) Liberal Bob Nault

Colleagues, we'll bring this meeting to order, pursuant to the order of reference of Thursday, April 14, 2016, and section 20 of the Freezing Assets of Corrupt Foreign Officials Act, a statutory review of this act.

This afternoon we're going to hear from two witnesses: one in person and one via video. I'd like to introduce the two individuals. The first is Andrea Charron, assistant professor, University of Manitoba, and director of the Centre for Security, Intelligence and Defence Studies at Carleton University. Welcome to you. By videoconference, we have the honourable Sue Eckert, adjunct senior fellow, Center for a New American Security. Welcome to you as well.

I assume we'll start with Madame Charron. We'll do the two presentations in a row and then we'll go to questions.

3:35 p.m.

Dr. Andrea Charron Assistant Professor, University of Manitoba, and Director of the Centre for Security Intelligence and Defence Studies, Carleton University, As an Individual

Thank you.

Thank you so much for inviting me to appear before you today.

My comments are focused on Canada's use of sanctions since 1990 and highlight issues with Canada's sanctioning practices. Canada's rate of application of sanctions has been high since the 1990s as a result of a very active UN Security Council and Canada's obligation to give effect to those measures. Of late, however, Canada's sanctions have been imposed by choice rather than by obligation, and have been applied to demonstrate that it is a good ally to the European Union, the U.S., and others, rather than by requirement of international law.

The committee's focus on just the Special Economic Measures Act and the Freezing Assets of Corrupt Foreign Officials Act is limited, in my opinion. On one hand, I appreciate what an enormous topic this is, but on the other, we risk missing the big picture that is the panoply of sanctions measures.

In 40 cases since 1990, Canadian sanctions have been applied, but the overwhelming majority of them— 34 cases or 85% of them—involve application of the United Nations Act and not the SEMA or the FACFOA. Indeed, there have been only 10 cases involving the SEMA, of which four also involved the UN Act, one involved the Area Control List, and one involved the FACFOA. Only four cases involved the SEMA alone, those against Haiti, Russia, Syria, and Zimbabwe; and only three cases involved the FACFOA, those against Tunisia, Egypt, and Ukraine, of which the latter is also subject to the SEMA.

Now let's consider this list. Haiti was one of the poorest countries in the world when comprehensive sanctions were mandated by the UN, making the lives of Haitians worse, not better. The U.S. military intervention is what compelled the military junta to relinquish control. In the cases of the current measures against Russia, Syria, and Zimbabwe, Canada's sanctions do not enter into the policy calculations of the leaders of these states, nor would more stringent Canadian sanctions. The unintended consequences of more punishing measures would only harm innocent civilians. Likewise, if we consider Tunisia, Egypt, and Ukraine, subject to the FACFOA, there are very few foreign assets in Canada to seize. As Canada does not have extraterritorial reach, all assets to be seized must have a Canadian connection.

The problem, therefore, is not with the acts individually but with multiple standing acts of legislation being applied concurrently. Layering sanctions measures does not make the sanctions more effective or more compelling but rather shifts more of the burden onto Canadian banks and businesses to ensure that Canada's sanction measures are given effect.

Twenty-two of Canada's 40 cases are still active today, including sanctions against Somalia, first applied in 1992. Eleven of the 22 are UN-only sanctions. The other 11 are a combination of UN- and ally-led or ally-only measures. All sanctions until 2006 were UN-led. Belarus, subject to the Area Control List in 2006, started a trend of sanctioning in support of allies. Burma and Zimbabwe quickly followed. Today four cases require the UNA and the SEMA in support of the U.S. and EU, those cases against North Korea, Iran, Libya, and South Sudan; three use the SEMA to support U.S. and EU sanctions against Russia, Syria, and Ukraine; and one supports EU sanctions against Tunisia using the FACFOA. Of course, application of the FACFOA is driven by a foreign country and not by Canada.

This means that, in the case of the SEMA, Canada is picking and choosing not only which cases but with which allies to partner. Surprisingly, Canada has never sanctioned with just the U.S. since 1990. It prefers to sanction, it would seem, with a minimum of 28 other states. This does not mean, however, that Canada has matched all EU sanctions automatically. For example, the EU has sanctions in place against Guinea, and it had measures against individuals from Moldova, but Canada did not follow suit. Nor does Canada necessarily lift sanctions at the same time its allies do. All sanctions against Liberia and Côte d'Ivoire required by the UN Security Council were dropped in the spring of 2016, and yet Canada hasn't created new regulations to lift its measures.

This tendency to layer sanctions complicates compliance with sanctions considerably. Seven Canadian cases require two or more of Canada's five standing acts to deal with sanctions. Of course, this doesn't include the 28 cases that have or have had travel bans, which require invocation of the Immigration and Refugee Protection Act. The acts have different penalties for non-compliance and different definitions for the measures applied, such as the definition for the seizure of “property”. For businesses, it is a constant battle to understand what measures are in effect. This resulted in a company in Red Deer, Alberta paying $90,000 in fines, in 2014, for $15 worth of O-rings.

Given the tendency toward layering sanctions and making compliance even more complicated, Canadian companies and banks have three options.

The first is to spend an enormous amount of money to ensure compliance, which means that the sanctions become a penalty for the company or the bank.

The second option is to factor in paying the fines for inadvertent sanctions-busting as a cost of business, which means that costs for goods and services increase for consumers.

The third is to stop doing business altogether with the state in question, which means that sanctions become far more coercive than originally intended.

The Canadian government potentially has carte blanche in terms of the measures it can enact and the stances it can take. Of course, taking executive action is the prerogative of elected governments, but I would like to highlight six concerns with Canada's sanctioning practices.

First, the unintended consequences of sanctions, especially when layered, can ensnare innocent civilians like Mr. Abdelrazik.

Second is the cost downloaded onto banks and businesses to comply with the number of rules and regulations.

Third, there is a difficulty tracking Canada's current sanctions. One must drill down to access many different regulations on many different sites. Canada's reference to all sanctions as “economic” is also misleading.

Fourth, there are different penalties and definitions, such as for “property”, across the legislation for various sanctions.

Fifth, there is a considerable time lag between the decision to apply or lift sanctions and the necessary Canadian regulations coming into effect.

Sixth is the tendency of Canada to treat sanctions as a tool of compellence and apply more measures. Canada's measures are, at best, a signal of Canada's desire to support collective security and its allies.

This concludes my opening statement, and I look forward to your questions.

3:40 p.m.

Liberal

The Chair Liberal Bob Nault

Thank you very much, Professor Charron.

Now we'll go to Ms. Eckert.

3:40 p.m.

Sue Eckert Adjunct Senior Fellow, Center for a New American Security, As an Individual

Good afternoon. Mr. Chairman and members of the committee, thank you very much for the invitation to participate in your review of sanctions legislation. I'm very sorry that I'm unable to join you in person, but I appreciate the opportunity to discuss sanctions legislation with you.

Given the time constraints, I don't have a statement now, but will be happy to provide my comments and also a statement for the record.

Just on a personal note before I begin, I'm particularly pleased to be addressing this standing committee of the House of Commons because my first and most formative job was as a young staffer on the House foreign affairs committee of the U.S. House of Representatives addressing some of these very issues. I was considerably younger then, but some of the issues still apply.

Mr. Chairman, let me focus my remarks on three aspects of UN sanctions. I think Professor Charron did a good job addressing the Canadian sanctions situation. I want to talk a little bit about UN sanctions. I'm talking about three particular aspects. One is the question of the effectiveness of UN measures, and this is the perennial question of whether sanctions work. The second is the unintended consequences of even targeted measures; all UN sanctions since 1994 have indeed been targeted. The third is the importance of national implementation measures, and this is from the perspective of legal, administrative, and private sector compliance.

My comments don't necessarily reflect those of the Center for a New American Security but do very much address the range of experience I've had in the congressional and legislative branches and more than 15 years at the Watson Institute, where I worked very closely with the Canadian government at times on various sanctions projects.

First, with regard to sanctions effectiveness, earlier this year the result of the targeted sanctions consortium—and this is a multi-year, international research consortium in which Professor Charron participated—released the results of its quite significant assessment of the impact and effectiveness of UN sanctions. Now assessing whether or not sanctions are effective depends on how you define the objectives.

The most popular discussion of sanctions focuses solely on the issue of whether they are effective in changing behaviour, but it's important to distinguish between multiple purposes of sanctions if you're going to assess the effectiveness. The first, of course, is to coerce a change in behaviour, and that's the most commonly assumed reason for sanctions. The second, though, is to constrain activities of individuals or groups and their access to central resources, such as finance, arms, dual-use technology, and people. You can imagine a situation here where al Qaeda or ISIL is not necessarily deterred or coerced by sanctions, but it is indeed important for us to limit the resources that they could use. The third purpose of sanctions is to signal a violation of an international norm and stigmatize the targeted individual.

There are other innovations of the targeted sanctions consortium as well, and one of them is breaking down sanctions into episodes. As Professor Charron noted, in Somalia we've had more than 20 years of UN sanctions, but they have changed over time, so it's important to assess what the different purposes are and how they change.

Let me just give you a brief overview of UN sanctions. They were judged to be effective overall in 22% of the episodes, but what's far more interesting, I think, is that sanctions to constrain and to signal were nearly three times more effective than those cohesive measures. So 27% for signalling and constraining versus 10% for coercing. I think it's important to keep the purpose in mind when you're designing sanctions and to try to take stock of those purposes when you're designing them.

Other important findings of the research include the fact that sanctions are never used in isolation. Sometimes it's referred to as between war and words, but they're almost always accompanied—97% of the time—with other measures. This could be diplomacy, it could be mediation, and it's often used with peacekeeping in the context of UN sanctions in 62%, or the use of force in 62% as well. And sanctions are most effective when they are used in combination. The most effective combination tends to be asset freezes, travel bans, and arms embargoes, and those are the three that are employed most commonly together.

The other interesting aspect is commodity sanctions, which are used primarily in armed conflict and tend to have a high effectiveness.

The second issue that I wanted to talk about is the unintended consequences of sanctions. As you know, targeted sanctions were developed as a reaction to the humanitarian cost of economic sanctions imposed against Iraq. There was a trend and, as I said, since 1994 all UN sanctions have been targeted. However, even as they are targeted, there are unintended consequences.

First, there were concerns about human rights and due process. This is because the UN has designations. For individuals who may be inappropriately or erroneously listed, is there the ability to get off the list? There is lack of judicial review, but over a period of time the Security Council adopted an innovative system of creating an ombudsperson for the al Qaida sanctions committee to review the designation, to which those individuals who are listed can apply for reconsideration. This is an important issue for Canada because a Canadian jurist pioneered and established the procedures, Judge Kimberly Prost.

Second is something I think that Professor Charron alluded to, and that is the broader effect that sanctions have than what's called for in the sanctions themselves, which is over-compliance. This is for lack of understanding of the complicated measures. It's for uncertainty, especially with the multiple layering of regional and unilateral sanctions. Once sanctions are imposed in a country, they have a dissuasive effect on compliance of individual firms.

Third is the de-risking issue. This has been particularly important and pronounced most recently, and that is financial institutions perceiving high-risk customers being correspondent banks, money service businesses, non-profit organizations, and charities, etc. They close accounts, delay wire transfers, etc., but it's had a very chilling effect on the ability to provide humanitarian assistance. There is a report out from the UN—it was leaked, actually—on how sanctions are severely impacting humanitarian assistance to Syria. I'm currently involved in a Gates Foundation study of non-profits and the effect of sanctions, anti-money laundering, and terrorist financing provisions on financial access.

Fourth is a focus on implementation. I think this is particularly important because the UN Security Council can pass measures, but the governments don't actually implement them; the private sector does. Governments can't freeze assets. There was an effort last year, when five member states came together and provided a series of recommendations. It is called the High Level Review of UN Sanctions, and is focused on implementation and not whether or not we're going to have sanctions on Syria—because of Security Council politics, we don't—but once the Security Council makes a decision, it needs to be implemented up and down the line within the UN and especially member states.

This is very important because imposing and removing sanctions is absolutely critical to their effectiveness. Co-operation with the private sector is critical to implementation of sanctions. We've seen a growing need to deal with the private sector to find ways to collaborate on making the sanctions more effective, making the purpose of the sanctions clear, helping to provide the guidance about how to implement the sanctions, and talking about impact or mitigating unintended consequences.

The last point I would just make with regard to implementation is there is a significant need for capacity-building assistance. Many countries don't have the capacity to implement sanctions, and that lessens their effectiveness. One of the recommendations that came out last year was to focus on building capacity in member states. The Canadian government has supported this in the past.

In conclusion, Mr. Chairman, Canada has a very proud history of leadership and innovations in UN sanctions.

Ambassador Fowler was a path-breaker in terms of being chair of the Security Council committee dealing with Angola. Judge Prost has really championed the issue of due process and the rights of individuals, and Canada has been known for being a strong supporter of effective and implementable sanctions.

I commend you for this review. I hope you'll consider the entire range of sanctions in your review and help make national implementation more effective. I would be pleased to assist the committee in any way possible and would be pleased to respond to any questions.

Thank you.

3:50 p.m.

Liberal

The Chair Liberal Bob Nault

Thank you, Ms. Eckert. That was very well put by both witnesses.

As usual, we're going to go right to questions, because I think it's important for the members to drill down into some of the areas that they have some interest in.

We're going to start with Mr. Kent.

3:50 p.m.

Conservative

Peter Kent Conservative Thornhill, ON

Thank you, Chair, and thank you to both of you for appearing here today. As you know, we're in the very early stages of this study.

There was some troubling testimony on our first day of witnesses on Monday when officials of Foreign Affairs, and the RCMP, and the Superintendent of Financial Institutions indicated there were some significant gaps in Canada's ability under the two pieces of legislation that are the direct focus of this study, SIMA and the Freezing Assets of Corrupt Foreign Officials Act. There was also an indication of interdepartmental dysfunction in terms of how different departments might interpret and enforce these acts.

We noted, for example, in the Freezing Assets of Corrupt Foreign Officials Act that there are 10 definitions of a politically exposed foreign person, but that seems somewhat anachronistic and outdated because some of the most corrupt individuals, for example, in the current government of Russia, are individuals who wouldn't fit any of those designations. Some of them are jailers, some of them are police officers, who we know have accumulated vast amounts of money, much of which they have been trying to move around the world to safe deposit areas, amounts of money far in excess of what would appear appropriate for their lifetime earnings under their current job descriptions.

I was asking specifically about the case of Vitaly Malkin, who for 20 years tried to get into Canada, was denied successively by Immigration, was interviewed deeply by CSIS, and is widely known. There is a huge file of credible evidence on his money laundering, on his embezzlement of UN aid funds, of his trade in conflict diamonds, and profits from organized crime.

Eventually, because a citizenship judge overturned the Immigration Canada interviewing officer's ruling that he was inadmissible, he was allowed into Canada. He has made tens of millions of dollars of investments into property in Canada. He has still been denied citizenship and has since returned to the Soviet Union where he would now be considered a member of one of those 10 definitions on the Freezing Assets of Corrupt Foreign Officials Act.

I'm wondering if you could offer your observations, and very often from the academic community we get straighter answers than we do with the officials of many of the departments responsible for enforcement of this act.

3:55 p.m.

Assistant Professor, University of Manitoba, and Director of the Centre for Security Intelligence and Defence Studies, Carleton University, As an Individual

Dr. Andrea Charron

The issue with the FACFOA, of course, is that it's not up to Canada to impose. It says under article 4, “If a foreign state, in writing, asserts to the Government of Canada that a person has misappropriated property,” then Canada can take steps. It has to come from the outside. Unless Russia is saying, please, get....which is not going to happen, so the FACFOA is not an issue.

In terms of the 10 categories, let's say Eritrea says it wants to get these guys and grab their assets, I think the reason why we have these 10 categories, this list, is so we're not going after the innocent janitor or teacher, we're going at the elite who have the capacity to make decisions. The problem with being so prescriptive in your list is, for example, it says that “military officers with a rank of general or above”, and, well, there's a reason we had Colonel Gadhafi. They know that and so they adopt the title that will often get them out of these sorts of things.

In the case of the FACFOA, unless Russia is requesting us to seize that gentleman's assets, then that is not one of the pieces of legislation we can use.

3:55 p.m.

Conservative

Peter Kent Conservative Thornhill, ON

Professor Eckert.

3:55 p.m.

Adjunct Senior Fellow, Center for a New American Security, As an Individual

Sue Eckert

I'm going to speak actually from both my Hill experience and the executive branch. One of the tools that we used in the U.S, at least—I'm not as familiar with the Canadian provisions—was the International Emergency Economic Powers Act. That provides very broad authority for the president to respond to any kind of emergency emanating outside the United States to the national security and foreign policy or economy of the U.S. Our OFAC and our treasury department actually use that for a number of measures to designate individuals subject to sanctions. I think that broad authority is actually very important. I don't know the degree to which the Canadian.... Again, you're focusing on two pieces of legislation, but they become a complex picture because they are a patchwork quilt, if you will, that has grown up over time. Sometimes it's a good thing to take a step back and look at what the ultimate objectives are, and to try to reframe them.

The other is that you do have differing standards. There's a reason why we don't have serious sanctions by the UN. There are limits to what we can do in the context of the Security Council. We always tend toward trying to make them as multilateral as possible, because more countries are following. It's very important because a number of countries, if they are not UN, can't implement them. They are based specifically on the UN.

In the particular case in terms of corrupt officials, that is not a UN measure. Now, it may be that like-minded states will be able to change the standards. To some extent, catch-all categories can be useful to governments in doing that.

4 p.m.

Conservative

Peter Kent Conservative Thornhill, ON

Thank you.

I assume both of you are familiar with the Magnitsky Act that was passed by the U.S. Congress. That leads to my question. In that context as a possible gap-filler in the Canadian context, could you address the effectiveness of targeted sanctions versus broad, sweeping national sanctions?

4 p.m.

Adjunct Senior Fellow, Center for a New American Security, As an Individual

Sue Eckert

Perhaps I could start. The sanctions now, by and large, are targeted. Whether they are UN sanctions or national measures, we have tried to target individuals and their behaviour and tried to focus on the kind of objectionable behaviour we want to change. Most of them are targeted. Having been in the position of implementing legislation that the Congress had passed, there is utility in providing broad authority to the executive and not having it be piecemeal, having one act going after Russia, having another act looking at Syria. That's why I think it's important to look at the totality, because it does get to be a problem.

In the U.S. case, for example, we started writing sanctions legislation in the 1990s, and each case had different waiver authority. It therefore got very complicated to actually remove the sanctions. What were the standards, was it national interest, national security? It simply got more and more complicated over time. That's why it's important, I think, to take a step back. You have the opportunity to look at the totality of what it is you want to accomplish.

4 p.m.

Conservative

Peter Kent Conservative Thornhill, ON

Professor Charron.

4 p.m.

Assistant Professor, University of Manitoba, and Director of the Centre for Security Intelligence and Defence Studies, Carleton University, As an Individual

Dr. Andrea Charron

I have a few points.

First of all, Canada does not have extraterritorial reach when it comes to our legislation, so there has to be a Canadian connection. Because Canada's banking system is so good, people are not generally hiding assets in Canada. We already have quite a number of steps and processes to make sure that we are not harbouring criminal funds, etc. That doesn't mean there isn't room for improvement.

4 p.m.

Conservative

Peter Kent Conservative Thornhill, ON

Except Mr. Malkin's millions.

4 p.m.

Assistant Professor, University of Manitoba, and Director of the Centre for Security Intelligence and Defence Studies, Carleton University, As an Individual

Dr. Andrea Charron

Yes, but there's also a danger in trying to change legislation to go after that one person. You may find unintended consequences for everybody else. And can you imagine the extra burden on the banks to have to go through millions of transactions to make sure that, perhaps, he or she wasn't involved in some way, shape, or form?

I remember an article written by Kim Richard Nossal based on James Eayrs, who many of you will know, who always counselled for Canada that the best foreign policy is when we stay in the middle. We don't become too idealistic and finger wagging and we don't think of ourselves as a great power. We steer that middle road.

Given the legislation that we have and that limitation on not being able to reach into other states—which I don't think we want to be able to do—realistically there's not a lot Canada can do. That doesn't mean, as Sue Eckert said, that the purpose of putting sanctions in place can signal this is not on, and it can start to develop a norm. That's very important, but it's not a tool to compel change.

4 p.m.

Liberal

The Chair Liberal Bob Nault

Thank you, Mr. Kent.

Now, we'll go to Mr. Sidhu, please.

4 p.m.

Liberal

Jati Sidhu Liberal Mission—Matsqui—Fraser Canyon, BC

Thank you, Mr. Chair. Thank you both for sharing your knowledge with us here today.

Professor Charron, you mentioned that the rubber rings were worth $15. I think there's more to this puzzle...exporting of prohibited goods in contravention of the United Nations Act resolutions on Iran, the SEMA, and the Canadian Customs Act. Considering the amount of resources that went into this to bring the party to the table, do you think a $90,000 fine is good enough to deter these companies not to get into these actions further?

4:05 p.m.

Assistant Professor, University of Manitoba, and Director of the Centre for Security Intelligence and Defence Studies, Carleton University, As an Individual

Dr. Andrea Charron

Well, $90,000 isn't the maximum amount. The SEMA and the UN acts contain differing amounts. I believe that under the UN act, it is $100,000 and 10 years of jail time if it's an indictable offence. Of course, Canadian judges do have discretion in taking into consideration all of the context. I haven't spoken to the company in question directly, but it sounds, according to what's been reported in the news, as though they realized that, oops, they had contravened the acts, and they came forward. I'm guessing that's why the judge took that into consideration when coming up with the amount assessed for them.

I would suggest that the committee might want to just take a good and a state that is subject to sanctions and try to drill down and figure out all of the different pieces of regulation someone has to go through, and try to get the definitions to try to figure out what it is that they can and cannot buy from or sell to these countries. It's getting to the point where it's just easier to say, “Well, I'm not going to do it”, but then that impacts Canadian companies and Canadian jobs, and that was never the intent, in the first place, of the Governor in Council deciding that those measures should be in place.

I would always caution against the unintended consequences of trying to go after all of the companies to maximum effect, because often the dribble-down effect hurts innocent Canadians.

4:05 p.m.

Liberal

Jati Sidhu Liberal Mission—Matsqui—Fraser Canyon, BC

Do you have a different take, Ms. Eckert?

4:05 p.m.

Adjunct Senior Fellow, Center for a New American Security, As an Individual

Sue Eckert

Well, let me just supplement. I think it depends on what you want to achieve by these sanctions.

I was a regulator. I administered dual-use export controls for the United States and the Clinton administration. I was looking for what the violations were and what people were doing. I have to say that the vast majority of companies are trying to comply. They are not trying to avoid sanctions, but the sanctions themselves are very complicated.

I would commend to you the UN sanctions report on Syria, because it gives an example of how complicated it is and how many different standards and how many different rules apply in these different circumstances. Then you have national sanctions, U.S. sanctions, EU sanctions, and then UN sanctions, and all of the different standards that exist. They're complicated.

I think it's important in the context of legislation to also have differences between willful and inadvertent violations. If there are unintended violations, presumably you're not going to penalize the firm. There can be mitigating factors. I think you have to take into account now that because they are so complicated, you do have this de-risking effect. Companies are not just getting out of the business, which I think in and of itself is important, including for reasons of national economic health, but they're also getting out of the business of providing humanitarian assistance, and they're getting out of the business overall because the risk is too great.

I'm not sure that's ultimately achieving foreign policy objectives of Canada or the U.S. or a number of other countries. We have to manage those risks and help the private sector manage them, but doing that requires clarity of regulations and guidance by the government, and often those are not forthcoming.

4:05 p.m.

Assistant Professor, University of Manitoba, and Director of the Centre for Security Intelligence and Defence Studies, Carleton University, As an Individual

Dr. Andrea Charron

May I add a personal anecdote that speaks to that? Canadian companies and banks are so concerned about making sure they comply because there are quite damaging consequences.

When I was working for the sanctions consortium, I was doing a case study on Sudan, which was under sanctions. I was being paid by the Swiss government to provide an assessment of how UN sanctions were doing on Sudan. The cheque came to my Royal Bank account, and the manager from Royal Bank phoned and said, “I'm going to have to call the RCMP because this could be a case of sanctions busting.” On the cheque it read, “Sudan sanctions”, to remind me what I was getting this money for. I had to go down with the contract from the sanctions consortium from the Swiss government to say, “I am not participating in Sudan sanctions busting. I am simply a Ph.D. student desperate for funding, and this is my cheque.” That's how serious they are about complying.

Even though there's a number listed on the Global Affairs site to get information, they can't give legal advice, and so you have to hire your own lawyers at great expense. It means that somebody like me was going to have my bank account frozen, which means I cannot pay my mortgage, I cannot buy food, and I cannot do anything because of this concern about making sure they comply.

4:10 p.m.

Liberal

Jati Sidhu Liberal Mission—Matsqui—Fraser Canyon, BC

Since we are talking about different countries, do you have experience of different countries punishing these kinds of activities in a larger manner compared to what we do here in Canada?

4:10 p.m.

Assistant Professor, University of Manitoba, and Director of the Centre for Security Intelligence and Defence Studies, Carleton University, As an Individual

Dr. Andrea Charron

Maybe Sue does. What are the U.S. penalties for sanctions busting against UN sanctions?

4:10 p.m.

Adjunct Senior Fellow, Center for a New American Security, As an Individual

Sue Eckert

It varies in the different kinds of effects. I would be willing to say that U.S. sanctions and enforcement actions are quite significant. Probably the U.S. has more enforcement actions than any other country. It's the billion-dollar penalties that a number of banks have been subject to. It's millions and billions of dollars in penalties that have driven this de-risking phenomenon because of the risk of inadvertent violations or being fined, and the reputational risks to their names. A lot of banks are turning down business and just saying, “We're not going to....” Some banks...there's one I know of that has said it will not do business in Africa anymore because of the risks.

There are a variety of risks. There are export control violations, and the standards for imprisonment or for fines are quite significant. In any number of specific legislations, the fines have been increasing. I don't have the statistics right in front of me, but I'd be happy to provide them. There are a number of enforcement actions in the U.S.

The European countries have had a number of enforcement actions, as well, but I would say that Canada, the U.S., and some of the European countries have the most.

4:10 p.m.

Liberal

The Chair Liberal Bob Nault

Thank you.

We'll go to Hélène Laverdière.