Thank you.

I'm an expert in money laundering and I am here to offer you five ideas that the government could consider. I was Canada's first director of civil asset forfeiture.

The first is this. The Proceeds of Crime (Money Laundering) and Terrorist Financing Act was recently amended to add a structuring provision. That's all good, but I'm suggesting that it be repealed. I'm suggesting that instead you port it and move it into the Criminal Code.

Here's why. Canada has been criticized in the past by the Financial Action Task Force for not using our existing money-laundering offences in prosecutions. For example, we use section 354, which is possession of proceeds of crime, instead of the money-laundering prosecution.

The reason for this is pretty simple: The penal consequences are the same, but it's much more difficult to take a judge through the money-laundering provisions. Even though there have been changes to the mens rea of that, it's still a problematic provision to use because the prosecutor has to find a predicate offence. Of course, organized crime obviously organizes their affairs to separate their crime from their money as a risk mitigation strategy, and that makes prosecution on money laundering much less likely.

My recommendation is to bring the structuring offence out of the PCMLTFA, the Proceeds of Crime (Money Laundering) Terrorist Financing Act, and to make it a designated offence under the code so that a prosecution for money laundering would be a prosecution for money laundering, not for the predicate crime.

I'll give you a second idea that's similar.

Project Collecteur, out of Alberta, interdicted a long-standing money-laundering operation. They were moving $200,000 per suitcase through Montreal, Toronto, Vancouver and Calgary. They might have moved upwards of $1 billion in cash, but the problem is that airport screening could not stop them. There was no problem moving $200,000 in a suitcase. Try to put a bottle of hand lotion in your suitcase, and you'll have a problem, but not with $200,000.

My idea here is that we add to the code a provision for bulk cash smuggling. There is a provision in the U.S. code that's similar. That would be an offence. Again, you could prosecute a money launderer for money laundering.

Finally, I have three points about civil asset forfeiture.

The first is around FINTRAC. In the spring, the government announced in the budget that it would finally allow FINTRAC to share information with civil forfeiture authorities. We've been hoping for this for almost 25 years. That's a really good thing, but it's not in place yet.

There is a risk to be managed because, in a civil forfeiture case, the director of civil forfeiture is allowed, using the civil process, to compel information from the bad guy, from the respondent. They're deemed to undertake to that defendant or that respondent not to use that information for any other purpose. The problem is that FINTRAC routinely collects something called a VIR, a voluntary information record, from police, and then it puts that into its database. There is a big risk that if it puts civil forfeiture information into a database, and then if it's used to lay charges and to prosecute someone, there will be a defence motion five or six years later that will have the case thrown out because there's a derivative use problem.

What I suggest here is that the standing committee amend the PCMLTFA to provide clarity on how FINTRAC's VIR process works and to ask it to work with the nine civil forfeiture jurisdictions to ensure that the information can be transferred without that problem occurring.

My fourth brief thought is around the RCMP.

The RCMP has an operational manual that guides its members about how to conduct investigations and how to address civil forfeiture. What the manual says right now is that civil forfeiture is always a last resort, and that's wrong. That might have been right 25 years ago; it's wrong now. I think that the RCMP should change the protocols within their operational manual to make civil forfeiture part of the early planning on cases.

This isn't about the primacy of a criminal prosecution. No one argues that; it should be first. What's happening right now is that files are being held back because it's a last resort, and by the time it gets to civil forfeiture, nothing can be done. The bad guys are laughing all the way to the bank because they get their tainted assets returned.

My final thought is about a gap in the Bank Act, which I know sounds unusual. Section 461 of the Bank Act says that a bank deposit account is deemed to exist at the branch where it was started. We have a couple of jurisdictions—P.E.I. and Newfoundland, for example—that don't have civil forfeiture. What we're seeing is that someone could set up an account in Charlottetown and could do all of their dirty business in Vancouver, and then when the civil forfeiture authority in B.C. comes forward, they could say that it doesn't have jurisdiction because it's a P.E.I. bank account and that there's no civil forfeiture there.

That's something that I think would be a simple legislative fix to section 461: Allow a court to say where the bank account is for the purpose of a civil forfeiture proceeding. That is where it's transacted. Then you'll close that loophole.

Thank you.