Evidence of meeting #39 for Justice and Human Rights in the 45th Parliament, 1st session. (The original version is on Parliament’s site, as are the minutes.) The winning word was rcmp.
A recording is available from Parliament.
Liberal
Liberal
The Chair Liberal Iqra Khalid
I'm sorry. That concludes your time. You have my apologies, Ms. Lattanzio.
Mr. Ste‑Marie, you have the floor for six minutes.
Bloc
Gabriel Ste-Marie Bloc Joliette—Manawan, QC
Thank you, Madam Chair.
I would like to extend my greetings to the two witnesses. I want to thank them for joining us and for their contributions to the committee.
I would also like to extend my greetings to all my colleagues. I'm filling in today for my friend Rhéal Éloi Fortin. I'm pleased to be here. I want to take this opportunity to acknowledge all the staff who help this committee run smoothly.
My first question is for both witnesses. I'll start with Mr. Matheson and then ask Professor Manirabona to provide additional insight.
Mr. Matheson, you spoke about the American model and the United Kingdom.
We have a federal structure here where some judicial powers and bodies fall under federal jurisdiction and others fall under provincial jurisdiction. Obviously, we want to ensure that everything runs smoothly and that the various components work well together.
When we look at the model in the United Kingdom, it appears that fraud continues to rise despite the policy's implementation. In contrast, when we look at the model in Australia, which implemented a cross‑sector coordination strategy, it appears that fraud has decreased.
I would like you to share your analysis of these models and to identify the components that could serve as inspiration here.
Mr. Matheson, I'll let you respond first. Professor Manirabona can then provide additional insight.
Partner, McCarthy Tétrault, As an Individual
In one way or another, these other jurisdictions have found ways to embed lawyers in the investigative process, and that has helped. It has stepped up the enforcement efforts when facing these complex threats.
It's not that their work is done. I think you make a good point. There was a report that came out recently in the U.K. about the extreme threat that fraud is still posing in that country, notwithstanding that they've had a Serious Fraud Office since 1988.
This suggests to me that it reinforces the theme that Canada is lagging behind. We need to have more effort directed towards centralized effort, especially for the serious and complex fraud and money-laundering problems that we are facing.
Each of those models that you mentioned probably has its strengths and weaknesses. What they have done, which I think we need to start doing, is to bring cases and bring investigations in order to get better in this field. The more you do it, the better you get at it. You figure out which are the right cases to actually charge. Some investigations will not result in charges and charges should not be brought if the allegations are misplaced. A big part of this story is around the dedication of resources by those other jurisdictions and sustained development of expertise.
Bloc
Full Professor, Faculty of Law, University of Montreal, As an Individual
Yes, thank you.
You brought up statistics on fraud. I haven't had a chance to read that report. However, there may also be other explanations, particularly the current widespread use of new technologies in economic and financial crimes.
The integrated police‑prosecutor model seems the most promising. That said, nothing is stopping you from exploring what the Australian model has to offer. When you compare different approaches, you can often build something stronger.
Bloc
Gabriel Ste-Marie Bloc Joliette—Manawan, QC
Professor, one key takeaway would be the need to implement a national cross‑sector coordination strategy, as Australia has done. That's good.
I would like to ask a question that my colleagues discussed with you. The legislative ambiguity of this bill, particularly the lack of clarity regarding roles, could lead to questions and duplication.
I would like to hear your thoughts on this topic.
Full Professor, Faculty of Law, University of Montreal, As an Individual
Yes, I spoke about the risks of the dispersal of efforts. I recommended setting boundaries for the future agency's jurisdiction, in particular by drawing up a list of offences that will fall under the agency's jurisdiction. The remediation agreement regime could serve as a model in this area. The list doesn't need to be the same. It could be a short list or a longer one. It's up to you. I think that this will help ensure that the agency does its job well.
Liberal
The Chair Liberal Iqra Khalid
Thank you very much.
Moving on to our second round, we will start with Mr. Baber for five minutes.
Please go ahead.
Conservative
Roman Baber Conservative North York, ON
Thank you very much.
Professor Manirabona, welcome to our committee.
Full Professor, Faculty of Law, University of Montreal, As an Individual
Thank you.
Conservative
Roman Baber Conservative North York, ON
I reviewed your article in Law360 Canada, for which I thank you. You raised some real concerns about this piece of legislation. Specifically, you warned that the new financial crimes agency proposed in this bill by the Liberals will “become another investigative body in an already fragmented enforcement landscape.”
I don't think I could agree with you more. You have provincial police forces. You currently have a fragmented security regulators regime, which also does its own enforcement. You have the superintendent of financial institutions. You have the Canadian anti-fraud centre. Of course, you have FINTRAC as well. Then you have all the federal policing units, such as the integrated money-laundering investigative team in the RCMP. You have the financial crime coordination centre. You have the integrated market enforcement team. You have the federal serious and organized crime unit.
Now the Liberal government is coming to Parliament saying that they want yet another law enforcement body to police financial crimes.
You ask, in your paper, what fragmentation costs in real financial crime cases. What do you mean by that, and what do you think the cost is?
Full Professor, Faculty of Law, University of Montreal, As an Individual
This cost is tied to a lack of coordination.
Obviously, it isn't necessary to hire new people. The police officers who are already serving in the police forces could be assigned to the agency to ensure better coordination.
As I said earlier, it's also necessary to define the roles. You spoke about the provinces and the federal government. I've seen cases where the provinces and the federal government agreed on the limits of their respective jurisdictions or on how to share roles.
When I said this, I wanted to show the significant benefits of pooling efforts rather than fragmenting agencies. It's necessary to join forces in order to become stronger.
Conservative
Roman Baber Conservative North York, ON
I agree with you, Professor. If anything, I think consolidation is in order, instead of creating an additional agency that, as some of our previous witnesses stated, will fulfill the exact functions the RCMP currently has.
With respect to coordination, I'm even further concerned, because the legislation in the present form does not provide for any need for this new agency to share information with anyone other than the RCMP. That means provincial agencies, security regulators and provincial Crowns will be left out of the know, potentially. I don't think that's good for the law enforcement business.
I want to come back to your second warning, in that there is an unclear mandate that this new agency will be vested with. This may give rise to a jurisdictional overlap with existing police units, securities regulators and anticorruption agencies. It's not clear what spectrum this new agency will cover. That will be left to regulation. I respectfully suggest to the government that this is precisely what Parliament is vested with. We need to decide the scope and jurisdictional power of this agency in the bill, not in cabinet.
What do you think about that, sir?
Full Professor, Faculty of Law, University of Montreal, As an Individual
I agree. However, we already know that many of these crimes are transnational, meaning that they cross borders. We can assume that these cases will automatically fall under the jurisdiction of the future agency.
For domestic crimes, there may also be agreements with provincial police forces to determine which crimes will fall under the jurisdiction of the future agency.
However, I can already tell you that transnational crimes alone are quite common, so we can assume that they will be the agency's priority.
Liberal
The Chair Liberal Iqra Khalid
Thank you very much for that.
We're moving on to Ms. Gladu for five minutes.
Please go ahead.
Liberal
Marilyn Gladu Liberal Sarnia—Lambton—Bkejwanong, ON
Thank you, Chair.
Thank you to the witnesses for being here today. I'm going to start with Mr. Manirabona.
You talked about how you don't think this bill clearly defines the types of cases that should be investigated. I liked your idea very much of this list of crimes that the FCA should handle. In my view, different levels of police forces are going to see money laundering, drug trafficking and human trafficking. FINTRAC is going to pick up some things. It's a question of who's going to take these on? Who's on first? Who's going to take the lead?
In addition to what you're saying, though, it seems to me the comments that Mr. Matheson made about the complexity, the magnitude of the dollars, the complexity of the evidence and how difficult it will be to get the suspects may also be factors in determining what the FCA does.
Would you agree that we should put some greater definition on how these things will be coordinated and which specific cases the FCA needs to handle?
Full Professor, Faculty of Law, University of Montreal, As an Individual
The limits of the future agency's jurisdiction remain unclear at this point. It's necessary to clearly define the scope of the agency's investigative authority.
When it comes to considering prosecution, I also propose that police investigators and other intelligence specialists be joined by crown prosecutors who can consider prosecution. As I said at the start, we've had situations in the past where police officers investigating cases and gathering evidence didn't always do things the right way. These situations sometimes involved violations of the Canadian Charter of Rights and Freedoms. The involvement of crown prosecutors will help prevent this from happening.
Liberal
Marilyn Gladu Liberal Sarnia—Lambton—Bkejwanong, ON
Thank you. I'm sorry. I only have a little bit of time.
Clearly, to me, you have to know what kinds of cases the FCA will be handling in order to know what kinds of specialists you need to hire in order to bring that expertise.
Mr. Matheson, you talked about the enormous amount of experience you may need in financial and digital evidence, AI, the dark web and in crypto, along with some of the experiences and challenges in dealing with multiple provinces and countries. What do you think needs to be added to this bill in order to add that clarity?
Partner, McCarthy Tétrault, As an Individual
I believe it's a real priority to have the capability to address exactly what you're talking about. I'm not sure it needs a legislative change, quite frankly. Isn't that a really classic operational issue? Who do we staff up with? How do we develop them? How do we keep them? How do we attack the threat that we face? I don't think legislation should get into the micromanagement of an area that is, by definition, run by experts.
What this legislation is aimed at is financial assets, financial markets and financial services that have been victimized by some kind of crime. There is definitely a theme here and it has some desirable flexibility. As I said, when the adversary, the perpetrator, sets out to commit a financial crime, they don't think about it in terms of what defined offence they're going to be committing. They are coming up with a scheme of one kind or another, and it may manifest itself in a variety of different criminal offences.
In any jurisdiction, whether it's the U.K., the U.S., European countries or Asian countries, there is coordination between agencies. It's necessary. Without that, it doesn't work. That's an operational consideration, in my respectful submission.
Liberal
Partner, McCarthy Tétrault, As an Individual
That's correct, I would.
I think there's plenty of room to develop protocols between different agencies.
