Public Accounts Committee on May 11th, 2023

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

In terms of red flags, for example, what types of red flags would you see in an organization that would require some oversight? In particular, what if an organization's entire board resigned?

[Bob Hamilton]

Without getting into very specific cases—

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

No, I'm just speaking generally.

[Bob Hamilton]

You mean generally.

I mean—

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

If an entire foundation's board resigned, would that be a red flag to you?

[Bob Hamilton]

My sense, and I'll look to the expert, is that if we see turmoil or if we have some suspicion that maybe things aren't working well, we might not necessarily go in, depending on what we think, but it could be something that we factor in and say that maybe it's worth a look.

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

It is very unusual, I think, in terms of your time at the CRA. Organizations' boards don't often see an entire resignation of their board unless something strange is taking place. Would you agree with that?

[Bob Hamilton]

I'm probably not going to comment on that. The question could arise—

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

Why not?

[Bob Hamilton]

—in the broader corporate sector as well in terms of what happens with boards and so on.

I wouldn't want to comment specifically on that circumstance. Suffice it to say that—

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

It's circumstances, plural.

[Bob Hamilton]

Yes, circumstances.

We have intelligence about what's going on out there and we try to use that intelligence to try to dictate where we are best placed to put our resources to examine further what—

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

Would you say that you are aware of some of the red flags that have taken place in the last year with organizations?

[Bob Hamilton]

Maybe the most productive thing to do—I'll put Sharmila on the spot, perhaps, or Geoff—would be to ask what some of the things are that would catch our attention. I'd rather—

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

What about a government endowment to an organization from, let's say, 2003?

[Sharmila Khare]

I think it's difficult to comment on this particular situation. The governance of charities is not within our jurisdiction. That's within the province's jurisdiction. We're always looking to the Income Tax Act. What is most important from a regulatory standpoint is this: Is the registered charity using its charitable resources to further its charitable purposes? That is what we are trying to ensure.

If there is trouble within a charity, it is likely that other things will be going wrong and that they won't be able to meet the requirements under the Income Tax Act. Their actual governance is not within our mandate. We always have to tie our regulatory responsibilities back to the Income Tax Act, asking whether you are furthering your charitable purposes in using your charitable resources.

[The Chair, Conservative, John Williamson]

Thank you very much, and I appreciate your not interrupting, because you know my rule.

Mr. McCauley, you have the floor for five minutes, please.

[Kelly McCauley, Conservative, Edmonton West, AB]

I will take the quota on interrupting.

[Voices]

Oh, oh!

[Kelly McCauley, Conservative, Edmonton West, AB]

Witnesses, thanks for being with us today.

Specifically with this charity, we've seen them violate the rules, and knowingly violate the rules, in how they issued the receipts for the donations from the two gentlemen linked to the Beijing Communists. Apparently they are not in compliance with their disbursement obligations. As well, apparently they have not followed the obligations under the CNCA requirements as a soliciting corporation.

Would this trigger an audit in other charities?

[Bob Hamilton]

Mr. Chair, the first thing I would say is that I don't know the facts of the situation. We all—

[Kelly McCauley, Conservative, Edmonton West, AB]

We know the facts. I just told you the facts, Mr. Hamilton, so you're aware. It's broadly known in the country, so please don't say you don't know.

[Bob Hamilton]

But we—

[Kelly McCauley, Conservative, Edmonton West, AB]

I laid it out clearly to you, Mr. Hamilton. Would this trigger an audit in other charities? These are known facts. These are not suppositions. They're known facts.

[Bob Hamilton]

I would not comment, even if we went in, but I certainly wouldn't offer a comment without having our investigation look to confirm the circumstances—