Finance committee  The person has to stand before us to open the account. We're talking about opening an account.

Finance committee  Okay. Transferring money from one account to another is a legitimate function of a financial institution. It is reportable to FINTRAC if it is large, over $10,000, or if there is any suspicion about the nature of the transaction. If the bank is uncomfortable with the transaction, the bank can say it's not going to do it.

Finance committee  I couldn't tell you. Well, again, Mr. Chair, we're here representing the industry broadly. I'm going to try to answer all of your questions and try to be helpful. That's why we accepted to come before this committee.

Finance committee  There are particular rules that are put in place by governments. There's a “know your customer”, there are the anti-money laundering rules, there are the FINTRAC reporting requirements, and there are also just the policies and procedures that individual banks put in place to make sure they understand what their employees are doing.

Finance committee  Mr. Chairman, my colleague, Darren Hannah, is really the expert on FATCA, so I'll let him answer.

Finance committee  We haven't really thought about that. I don't want to give an answer off the cuff, so we can get back to you.

Finance committee  Say a new customer comes in and makes a large deposit. We clearly establish the identity of the individual.

Finance committee  No, we're talking about opening accounts; these are done in person. We identify who is opening the account, the source of the income, and again, we're talking about relatively large accounts here. Try to understand—

Finance committee  Mr. Chairman, we have seen, I think, the democratization of financial advice and financial planning, of which tax planning is a legitimate part. I think the financial sector in Canada provides a wide range of services to Canadians to enable them to save efficiently, to have access to credit in an efficient manner, and to make the right decisions, all of which comply with the law in Canada and in other jurisdictions.

Finance committee  I agree.

Finance committee  The number was cited about investments in places like the Cayman Islands and Barbados. Canada is a relatively small economy. To achieve economies of scale in our commercial firms and in our banks, we have to grow outside of our boundaries. In doing so, we have to compete globally.

Finance committee  Let me start by essentially reiterating what we said in our opening statement. We do not support tax evasion and the Canadian banking system does not support tax evasion. We don't encourage our customers to evade taxes, and we recognize that there is an issue there. But as we try to deal with a tax evasion problem, what we view as a problem, it's important that we be able to distinguish tax evasion from legitimate business activities of firms that operate in a global environment, including banks and commercial firms that have to be competitive.

Finance committee  Thank you, Mr. Chair. Good morning. We are pleased to be here today representing the Canadian Bankers Association and our 54 members, including domestic banks, foreign bank subsidiaries, and foreign bank branches operating in Canada. We welcome the opportunity to talk about taxation, and in particular how our strong, stable banks contribute to Canada and the Canadian economy.

Procedure and House Affairs committee  I think that more competition in the business lending environment is a good thing.

Procedure and House Affairs committee  To address the first part of that question, we lend billions of dollars to small business and medium-sized businesses at interest rates that are very competitive. We have authorized approximately $80 billion to SMEs in Canada. In fact, banks are notorious for lending within a range of prime rate to prime plus 3%.