Bring U.S. Rico Laws to Canada

What if the reputation that Canada has received for being soft on money laundering, organized crime, and transnational crime could have been avoided decades ago? Well, it could very well have happened because almost 50 years before B.C.  created the Cullen Commission and changed Canada’s trajectory for how we dealt with serious crime, B.C.’s Criminal Justice Division published a game-changing report in 1980 titled The Business of Crime: An Evaluation of the American RICO Statute from a Canadian Perspective, recommending that Canada introduce RICO-styled laws.

This series-concluding article will look into that 1980 report by B.C.’s Criminal Justice Division, the complexities involved with connecting with some stakeholders and the ambiguous meaning behind the saying “in the public interest”, a novel approach to whistleblowing that focuses on rewards, and what filmography can tell us about crime and society.

The Business of Crime: An Evaluation of the American RICO Statute from a Canadian Perspective (1980).

The Business of Crime report, published in 1980, appears to have been shelved and has been collecting dust ever since, with few experts in academia ever having referenced it in their works.  The high-level breakdowns of RICO laws and Canada’s existing laws within the report, both federal and provincial, had all the potential for Canada to avoid being designated as a major money laundering country by the U.S.  State Department, or for former RCMP officers to declare that Canada was a laughing stock for it’s national and international crime efforts to combat fraud, money laundering, cybercrime, and other criminal activities.

Canada’s federal legislators should have jumped at that opportunity to address structural weak points within our legal framework, once B.C.’s Criminal Justice Division identified deficiencies related to how highly coordinated criminals were being prosecuted.  The two limitations to combating organized crime were identified as Canada’s Criminal Code not being directly concerned with the profits of crime or profit incentive, and instead focused on single transactions committed by individual offenders.  This was described as being tailored to “street crimes”—crimes that were spontaneous and poorly planned, violent, drug, or alcohol related, and not particularly successful from a financial point of view.  From the beginning of the report, there was an understanding that criminal organizations were different, better organized and less likely to get detected while having high potential profits, and it was understood when a criminal enterprise began to have more sophisticated and organized components it became a serious threat to society.

Throughout the report, a theme emerges relating to Canada’s laws being woefully inadequate for life in 1980.  Some of the issues raised included the lack of currency reporting laws, how nothing in criminal law was expressly designed to provide for the forfeiture of illicit profits upon conviction, nor was there a way to separate the criminal from a business operated by them in a criminal manner, Instead, the forfeiture laws within the Criminal Code focused on removing an object whose possession was unlawfulor to avoid any repetition of the offence.  As it related to the power of forfeiture, significantly, the laws excluded  shares of a corporation or interest in a partnership not ever being forfeitable.  It was also understood that intangible assets would get transferred to another person or corporation or hidden abroad if a suspect realized that they were under police scrutiny, and by the time of the conviction there would not be anything left to forfeit even if forfeiture were possible under the law.

The report concluded with the recommendation that Canada adopt legislation similar to U.S. RICO laws, calling the laws a novel piece of legislation that could assist with targeting criminal organizations because of the challenges with presenting a single case when there were a multitude of layers to the crime and when the focus was groups instead of individuals.  The existing framework within different agencies and departments at the time was such that they were insufficient enough for enterprise or organized crime.

Despite that there would be a constitutional challenge that had to do with the separation between federal and provincial laws, the legal experts suggested how the constitutional challenges between provincial and federal laws could be accommodate for RICO laws. In the end, this group of legal experts concluded that RICO laws were a novel piece of legislation that, when used properly and in conjunction with sound investigative techniques, could go after criminal organizations and successfully prosecute them and do something about the gains from illicit criminal activities.

The complexity of connecting with certain stakeholders.

Connecting with Ministerial offices in B.C., Supreme Court judges, Privacy Commissioners, academic experts, and other relevant stakeholders, was quite easy.  Instead, the complexity with connecting with stakeholders did not lay with establishing contact but rather with stakeholders with judicial powers being prohibited from speaking on adjudicated matters.  Rules around judges not being unable to opine on any judicial matters in detail and beyond the summary section goes back to the idea of ensuring the integrity of our courts, and the only time a judge might step outside the lines to opine on findings is after they have retired, similar to how lawyers are discouraged by their law societies to speak on one another.

What might complicate matters even more may be the polarization of journalism and news media and how the occasional twisting of words and the “gotcha” pieces on contentious issues has resulted in professionals across the spectrum, from lawyers and judges to police officers and politicians, being hesitant to speak with journalists or even go on record.  Nor does it help that more articles seem to be getting published as summaries of press briefs, and without going over the necessary academic literature, legal documents, and government reports, in search of evidence that demonstrates low-level thinking, then following up those discoveries with the appropriate questions.

Simply put, being able to uncover low-level thinking within literature, documents and reports comes down between choosing to dive into the details instead of summarizing a press release.  Then, the difference between asking the right questions in real-time and asking the right questions at a later time comes down to the ability to account for shortcomings in public policies and to ensure for forward progress.

Coming to terms with the ambiguous meaning behind “in the public interest”.

Some critics of public inquiries complain about the fact that they do not directly result in the convicting and the sentencing of public figures or the shutting down of corporations altogether.  Despite that it has not been legally determined as to whether public inquiries and the judges that lead them do carry over all their judicial powers, including those to find individuals or corporations criminally culpable or civilly responsible, it might not be in the public interest for them to do so.  And the ambiguous meaning behind “in the public interest” is a concept that many are likely to struggle with.

Had the Charbonneau Commission found individuals criminally culpable or civilly liable, or if construction corporations were dissolved for corruption, that would not have been in the public interest.  We must consider that public inquiries require the support of elected officials, so if elected officials begin to believe that public inquiries are going to make them or other bureaucrats the scape goat of all problems then that is likely to dissuade them for supporting public inquiries.  Secondly, consider that dissolving multi million-dollar construction corporations that employ hundreds or even thousands of workers, either directly or indirectly, would have unintended consequences with innocent workers possibly ending up houmeless or not having money for food and being unable to provide for their families.  That is the ambiguous nature of “in the public interest”:the implications of addressing criminal matters that should have been done decades prior and that have ballooned into something far too complex, because what constitutes as being legal or illegal is not the same standard as something being right or wrong.

Throughout it all, what should be clear is that the Charbonneau Commission was a positive for Canada because it resulted in municipalities across Canada running to implement new procurement procedures so as to not bring embarrassment onto themselves, publicly elected figures, and community figures that have been recipients of recognition awards and who also happen to give to charity.  But make no mistake, every province and all big cities within these provinces have seen their public procurement processes get exploited.  Despite that some Canadians are likely to have apprehension towards the efficacy of our public inquiries, the Cullen Commission too, was significant enough for the Five Eyes alliance to look into the problem in their respective countries, with Australia replicating the Cullen Commission’s efforts with their own public inquiry on large-scale money laundering.

So, public inquiries do work, just not in the same manner and purpose that provincial courts and federal courts do. But this is also why serious forms of crime need to be addressed in a timely manner and not decades after they have become overwhelming problems for the institution of policing and our courts.

Transitioning from whistleblower protections to whistleblower rewards.

The Securities and Exchange Commission (SEC) has been able to revamp efforts to combat securities violations through the creation of a first-of-its-kind whistleblower rewards program.  This program regularly pays out multi-million-dollar rewards, with the total rewards paid out since its inception being in excess of $1 billion, and it has helped the SEC recover in excess of $5 billion.  What makes the program a stalwart extends beyond the financial rewards to include robust employment protections, and the ability to report anonymously with the assistance of a lawyer.  Although the specifics of the program stipulate that the award can range from 10% to 30% of the monetary sanctions collected, it requires the sanctioning of over $1 million.

To date, the top four biggest rewards collected by a single individual are $62 million, $52 million, and $50 million twice.  Popularity for the program is at an all-time high, in 2020 6,900 tips were submitted, then in 2022 12,300 tips were submitted, but by the end of October 2023, there were over 18,000 tips that were submitted.  Best of all, non-U.S.  citizens can participate in the whistleblower reward program, but the main requirement is that the information needs to be submitted to the SEC first and not elsewhere like other government agencies, foreign law enforcement, or the media.

Conceptually, the idea of expanding whistleblower protections to focus more on whistleblower rewards is a sure-fire way for to get people submit complaints.  The assistance and information provided by the SEC’s whistleblower reward program has been described as among the most powerful weapons in the law enforcement arsenal.  Assuming the information turns out to be valid, it allows law enforcement to reduce harm exposure to investors and to ensure the integrity of financial institutions and capital markets.  So, a similar whistleblower reward program with big-time payouts would help Canada to get ahead of criminal enterprises that are involved in crimes like money laundering, organized crime, and transnational crime.  Perhaps the rewards need to be set at 50% of all monetary sanctions and assets forfeited totalling over $1 million.

What filmography can tell us about society and crime.

The National Post recently published a piece posing the question whether Toronto is becoming Gotham, but perhaps this is a question that should be extended to all of Canada’s big cities.  In London Ontario in 2021, a Pakistani-Canadian family of five was enjoying summer by taking a walk only to have a white nationalist terrorist carry out a vehicular attack on them, killing four and wounding a nine-year-old boy.  Then in Montreal Quebec in 2022, a seven-year-old Ukrainian girl came to Canada as a refugee with her mom and became the victim of a fatal hit-and-run just one day before Christmas break.  And just recently in Winnipeg, Manitoba in 2023, a 46-year-old Ukrainian husband, father of two little children, who came to Canada with his family as refugees was fatally by a criminal who was on probation for a weapons charge while on his way to work.

Hearing about criminal acts occurring like these makes it impossible not to have connections made with the fictional city, but Gotham had the Dark Knight.We do not.  Perhaps it is the groupthink of societies that leads people into accepting comforting dreams instead of uncomfortable realities, as long as it makes life feel easier.  Perhaps the comfort of such dreams should be a cause for concern to everyone because safety is thrown out the window right after a person leaves the confines of their home despite that we live in a “safe country” – an oxymoron.  Perhaps the relevance of the uncomfortable reality of the world we are living in is that our society may need more rules and regulatory frameworks that better protect the safety and well-being of all peoples that find themselves in Canada.  With no exceptions.