Government Operations Committee on Feb. 5th, 2024

[The Chair, Conservative, Kelly McCauley]

Thank you very much.

Mr. Bachrach, go ahead for six minutes, please.

[Taylor Bachrach, NDP, Skeena—Bulkley Valley, BC]

Thank you very much, Mr. Chair.

Thank you, Mr. Lafleur, for being here with us and answering our questions to the best of your ability.

My apologies to the committee if I'm a little slower than usual. The airplane I was on last night from Toronto suffered a cracked windshield in the air. It resulted in a very late night and early morning. Better safe than sorry, though. I certainly don't regret turning back when something like that happens.

I thought I'd start my questions around potential criminality. I understand that an RCMP investigation is also ongoing.

In your work, Mr. Lafleur, if you came across instances of fraud or other criminality over the course of your investigation, could you go over the steps that you would take? That's if indeed you were to come across such examples.

[Michel Lafleur]

Yes. The policy on government security's directive on security management, at paragraph 4.1.7, requires us to report any suspicions of criminality to the law enforcement of jurisdiction. When that does occur, we would typically first reach out to the RCMP and have a preliminary discussion to confirm whether our understanding of what occurred may be criminality. Of course, we're not law enforcement, but we do have a responsibility to report that when we see it.

[Taylor Bachrach, NDP, Skeena—Bulkley Valley, BC]

We had the ombudsperson at our last meeting. I note that, in the CBSA's response to the ombudsperson's recommendations, the CBSA states, “the CBSA is strengthening processes and controls related to procurement planning, contract administration, corporate culture and proactive monitoring to reduce the risk of fraud.” It seems, from that sentence, that they feel there is some risk of fraud that has become evident through the course of these investigations and conversations.

Could you talk a little bit about what kinds of instances would constitute fraud in the context of the allegations that are being made in this investigation?

[Michel Lafleur]

I can't speak to any specifics of the allegations, but what I can say is that any time there is an exchange of money between the government and other parties, there is a potential risk of fraud. People may want to circumvent internal controls to try to get something out of the system. Procurement is one area. Finance is another where that may occur.

[Taylor Bachrach, NDP, Skeena—Bulkley Valley, BC]

In the context of procurement, could you provide a very generic example of something that would clearly constitute fraud?

[Michel Lafleur]

I can. There have been numerous cases, sadly, in the past around false invoicing, with either completely false businesses invoicing the government or maybe an employee circumventing internal controls to sign both sides of a transaction. That would be clear fraud. From a vendor's perspective, submitting fraudulent documents could be considered fraud.

There can be any number of scenarios.

[Taylor Bachrach, NDP, Skeena—Bulkley Valley, BC]

Is looking for instances of fraud or other criminality within the specific scope of your investigation?

[Michel Lafleur]

It's within the scope of my duties. I have another function within my team that aims to identify potential fraud, corruption or misuse, using the agency's data through proactive data analytics. As we get into a file like this and we see evidence of potential fraud, we would report that to law enforcement.

[Taylor Bachrach, NDP, Skeena—Bulkley Valley, BC]

Shifting gears a little bit, I know Mr. Utano and Mr. MacDonald came to committee at a previous meeting. I wasn't at that meeting, but I'm familiar with what happened. They brought a number of documents, and you're familiar with these, I assume. Were those authorized and provided by the CBSA?

[Michel Lafleur]

I'm not familiar with the documents they would have provided to committee.

[Taylor Bachrach, NDP, Skeena—Bulkley Valley, BC]

Okay.

Moving on to the issue of security clearance, one of the issues at play here is the fact that GC Strategies, which had participated in the procurement process, did not have the document safeguarding capability that was stated as a requirement of the procurement.

Could you describe document safeguarding requirements for sensitive procurements like the ArriveCAN contracts?

[Michel Lafleur]

I can speak generally. Again, it's not my area of expertise, but I have some exposure to it as a security practitioner.

When we're talking about document safeguarding, it means that the vendor may be required to hold protected information within their physical premises or within their IT systems, which would be different from if they were working solely within a CBSA space where they may have access to systems of ours. However, when they control it, they need to have measures in place to protect it.

[Taylor Bachrach, NDP, Skeena—Bulkley Valley, BC]

What's the risk of misclassifying document safeguarding capability requirements in a procurement process?

[Michel Lafleur]

I'm sorry. In what regard?

[Taylor Bachrach, NDP, Skeena—Bulkley Valley, BC]

If a company that is participating in a procurement does not have the stated document safeguards and capabilities and is given the work anyway, what is the risk at play?

[Michel Lafleur]

Obviously there's a risk of potential disclosure of that information if it's not kept protected. Traditionally, we're talking about certified filing cabinets, things like that. In more modern times, it means encryption on their systems if they're going to be holding protected information. Obviously, that's—

[The Chair, Conservative, Kelly McCauley]

Gentlemen, thanks very much.

We have Mr. Brock, please, for five minutes.

[Larry Brock, Conservative, Brantford—Brant, ON]

Thank you, Chair.

Mr. Lafleur, with all due respect, your investigation in this matter is seriously flawed. You talk about your 15 years of experience working on hundreds of administrative investigations. You highlighted today in your opening statement that your key role is to ensure the integrity of the investigation, procedural fairness and due process for those under investigation.

Those under investigation have been targeted by you as Mr. Cameron MacDonald and Mr. Antonio Utano. They're the only two individuals under investigation. What you have done so far, sir, is anything but to ensure procedural fairness, so much so that they have retained a lawyer. A lawyer has brought an action in the Superior Court of Justice—and you, sir, are named as a defendant, as well as the Attorney General of Canada, the CBSA and Erin O'Gorman—seeking declaratory relief that their rights to participate in this process have been compromised by you.

Are you aware of that?

[Michel Lafleur]

I am aware of that.

[Larry Brock, Conservative, Brantford—Brant, ON]

That's right.

Sir, you don't have a legal degree, do you?

[Michel Lafleur]

I do not.

[Larry Brock, Conservative, Brantford—Brant, ON]

No, and you don't understand the difference between a criminal standard of proof and a civil standard of proof, do you?

[Michel Lafleur]

I do have some understanding of the difference.

[Larry Brock, Conservative, Brantford—Brant, ON]

It's proof beyond a reasonable doubt on the criminal spectrum, and beyond the balance of probability on the civil spectrum. You understand the difference between fact and allegation, don't you?