Industry Committee on May 20th, 2020

[Lloyd Longfield, Liberal, Guelph, ON]

One thing we've seen through COVID is that public health has been sharing information very openly with the public, which is helping the public to be on alert for behaviours that are helping and behaviours that are not helping when fighting the pandemic. Is that an opportunity in terms of a more open sharing of where we are getting attacked or is that tipping our hats to the bad guys?

[A/Commr Eric Slinn]

No, I don't think so. I think we strive to do that through the Canadian Anti-Fraud Centre. Maybe your question is this: Should we be more broad in our sharing, having local law enforcement agencies putting that up on their websites? I think that's a great observation, and it's something we can certainly build on.

[Lloyd Longfield, Liberal, Guelph, ON]

Thank you.

Not many Canadians know about the Canadian Anti-Fraud Centre and the work that's being done there. I have a report in front of me that shows that 188 Canadians have been victims to COVID-inspired scams and have lost a total of $1.2 million between the months of March and May of 2020.

Maybe this question is for Mr. Larocque. How does that compare? I think that in previous parts of this meeting I was hearing that there isn't much of a spike, but are we up from the same period last year?

[Insp Guy Paul Larocque]

Yes, we are. The number of reports that we received at the Canadian Anti-Fraud Centre was up about 25% for the same period, for the first four months of the year.

Obviously, in April, we had an uptick in extortion email campaigns, which really put the numbers up. In just April alone, we received about 5,000 more complaints on that. As far as notifying the public, the Canadian Anti-Fraud Centre has produced bulletins. Twice we've provided a bulletin on scams around the pandemic, which was posted on our website, posted through social media and distributed to many of our partners. We try to leverage our network to be able to create as much publicity as we can around those scams, so that the public is very equipped to respond to those attacks.

[Lloyd Longfield, Liberal, Guelph, ON]

Thank you.

With less than a minute left, maybe I can stay with you. This is with regard to MPs who might contribute to giving paths in for phishing. In the last week, I've had a Webex meeting with the mayor and the MPP, which we have regularly, Microsoft Teams meetings with some students at a high school, and this Zoom meeting. Are we contributing to the problem by opening ourselves up through networks such as these, or is there something that we need to be more aware of?

[Insp Guy Paul Larocque]

I'm not sure if I properly understand the question, but every effort to educate one another will certainly contribute to better protecting ourselves. One initiative that we've started picking up from the U.K. is Tell2. If everyone tells two other people, in no time we would cover the country.

[Lloyd Longfield, Liberal, Guelph, ON]

Great. Thank you very much.

[Insp Guy Paul Larocque]

You're welcome.

[The Chair, Liberal, Sherry Romanado]

Thank you very much.

Mr. Savard-Tremblay, you have the floor for two and a half minutes.

[Simon-Pierre Savard-Tremblay, Bloc, Saint-Hyacinthe—Bagot, QC]

Thank you, Madam Chair.

My question concerns borders. Since American fraudsters can easily cross the border, do the Canadian laws make us particularly vulnerable, especially given the delay in implementing the STIR/SHAKEN standards?

I'm not sure to whom I should direct my question, perhaps to the representative of the Royal Canadian Mounted Police.

[Simon Marchand]

I can respond quickly, with your permission.

[Simon-Pierre Savard-Tremblay, Bloc, Saint-Hyacinthe—Bagot, QC]

We're listening, Mr. Marchand.

[Simon Marchand]

Without commenting specifically on the STIR/SHAKEN standards, I can tell you that this issue was observed when EMV smart card technology was introduced in Canada. In the months following the implementation of the technology and once the critical mass had been reached, we saw fraudsters moving south of the border quickly enough to continue cloning cards, whereas here the trend was fading.

For fraudsters, the border isn't an issue. They'll go where they encounter the least resistance and the fewest obstacles to commit their crimes. We can reasonably believe that, if the STIR/SHAKEN standards are implemented in the United States and not in Canada, the fraudsters will come here and spoof telephone numbers.

[Simon-Pierre Savard-Tremblay, Bloc, Saint-Hyacinthe—Bagot, QC]

This would lead to a competition of sorts between the two systems, where Canada would stand out for its laxity in terms of actually applying a standard. Is that a good summary of your comments?

[Simon Marchand]

Yes. In all cases of fraud, the fraudsters go where the laws are the easiest to circumvent and where there are fewer regulations. If the standard isn't implemented here and is implemented south of the border, the fraudsters will come to Canada.

[Simon-Pierre Savard-Tremblay, Bloc, Saint-Hyacinthe—Bagot, QC]

Is it urgent to act and to legislate on this issue?

[Simon Marchand]

As I said earlier, it's essential to take action with regard to the STIR/SHAKEN standards. In terms of information security and consumer protection, Canada lags behind Europe and some of the American states. It's becoming urgent to act. If we don't act, we'll become the target of criminal organizations, which will come and attack Canadians.

[Simon-Pierre Savard-Tremblay, Bloc, Saint-Hyacinthe—Bagot, QC]

Madam Chair, do I have time to ask another question?

[The Chair, Liberal, Sherry Romanado]

You have 20 seconds left.

[Simon-Pierre Savard-Tremblay, Bloc, Saint-Hyacinthe—Bagot, QC]

Okay. I don't think that's enough time.

I want to thank Mr. Marchand and all my colleagues.

[The Chair, Liberal, Sherry Romanado]

Thank you.

Our next round is for MP Masse.

You have two and a half minutes.

[Brian Masse, NDP, Windsor West, ON]

Thank you, Madam Chair.

One of the things that really got me irritated about the Facebook situation was that they used third party applicants too. In the United States, they settled for $5 billion, and over here, $9 million. That doesn't even cover the Government of Canada's advertising costs. We're actually going to try to do that by having advertisements on fraud, this by a party that really has misled Canadians. I think that's inappropriate messaging. I suppose we have very few tools for that.

I'm going to follow with Mr. Marchand. With regard to STIR/SHAKEN, I understand the testimony from the companies, but it wasn't very compelling that we shouldn't do it anyway because there will be some net benefits even if not everybody has STIR/SHAKEN right away. Also, you could screen your phone calls coming in that way. You could have choices as a consumer and be empowered. You could choose to not even take a call if it wasn't being screened through STIR/SHAKEN. You'd have more control.

Are there other things we can do? I don't mind if you shoot these ideas down. It won't hurt my feelings. Should we be doing something more robust with a Crime Stoppers approach? Should we be doing something with direct mail, because we can control the messaging directly to Canadians through the postal system? Should we be looking at a royal commission?

The more we spend on preventing fraud, the more money we also take away from other crime. We seem to be missing a link in this country to take it to the next level.

[Simon Marchand]

That's a very broad question. It would require probably its own two-hour session.

We could use direct by mail—why not?—but fraudsters have been observed intercepting mail sent to customers. If they really want to target someone, they will intercept the mail. I think it brings us back to a new step in identification, which means digital identity, talking about biometrics, something that fraudsters are not able to breach. They are not able to impersonate a voice print or a biometric factor, and I think that's the next step.

Biometrics is sensitive, and that would definitely require a public consultation of some sort to make sure that we understand what the parameters are that we're setting and how it's going to be managed and handled.

[Brian Masse, NDP, Windsor West, ON]

Thank you.

Thank you, Madam Chair.

I want to thank all the groups for working on this. I know they've done a lot of good work over the years. I've seen it and I appreciate that.

[The Chair, Liberal, Sherry Romanado]

Thank you so much.

With that, we are at the end of the third round of questions.

I'd like to thank everyone for being here today. Thank you so much for your testimony.

Thank you for your patience with the technology.

Thank you to our IT team, translators, clerk and our analysts.

Our next meeting will be tomorrow. Stay tuned.

The meeting is adjourned.