The Foreign Interference Commission Update

On May 11th, 2024, a bombshell report by The Bureau’s Sam Cooper broke a news story about how illegal casinos were leveraged as a tool for blackmail and to carry out foreign interference.  It highlighted how during the Covid-19 pandemic a policing investigation titled “Project Endgame” concluded with a raid that was conducted on a $10-million, 53-room villa in Markham, Ontario.  That mansion had been operating as an illegal casino.  Police recovered guns, and footage of sex-services that were provided casino patrons—all of the activity in the house was recorded.

The York Regional Police (YRP), under whose jurisdiction the illegal activities were occurring, reached out to Canada’s public safety stakeholders such as the Canadian Security and Intelligence Service (CSIS), and raised the matter of what was discovered.  Digital evidence that was seized from the raid seemed to reveal that local politicians had been recorded gambling and in compromising sex acts.  But what was transpiring at the underground casino appeared to be known to Canada’s public safety stakeholders.

Since Canada’s laws require that the sharing of evidence between policing stakeholders and different public safety stakeholders be court approved, requests had to be submitted before the evidence could formally be transferred over.  However, before they could get court approval, a police officer on the scene of the raid had pocketed two watches, causing the charges to be dropped and much of what was seized returned.  More importantly, those videos of compromised individuals never made their way to CSIS, because they too were returned.

This is not the first time that Cooper has published must-read related to public safety, as he has also reported on money laundering, organized crime, and the institutional integrity of our democratic institutions.  The full story on the illegal underground casino is a must-read, and the series of events that unfolded might be the perfect case-study for why bettering obsolete legislation and public policies is so important.

“Canada has a secrecy culture”, Sam Cooper on the Crash Labs Podcast.

“Corruption” is a word that is often associated with developing countries and countries that do not embrace the democratic ideals of free and transparent institutions.  Hearing someone use words like corruption in a sentence when talking about Canada might cause some people to roll their eyes, but not when that someone is Sam Cooper.

As an award-winning investigative journalist, Sam Cooper has been breaking stories of corruption at the municipal, provincial, and federal level.  Cooper’s book Willful Blindness (2021) details the nexus between international organized crime groups and how such groups were able to catch Canada’s policing and public safety stakeholders by surprise and break ground in different sectors across Canada, both public and private.  Cooper’s work has even led him to present to his findings on anti-corruption to Canadian law enforcement agencies, US officials in the Pentagon, financial and legal professionals, and academics.  So, when Cooper says Canada has more of a secrecy culture than the US and UK, it may be time to listen.

On a recent episode of the Crash Lab Podcast hosted by Denis Laviolette, Cooper discussed his investigative journalism work and talked about corruption across the Canadian landscape.  Cooper explained how he became an investigative journalist by first covering municipal affairs.  That work led to the realization that Vancouver’s real estate market was being bought up via mystery money such as illicit profits of drug trafficking, illegal underground casinos, and more.

When discussing the effect that underground casinos were having in Canada, how they were connected to the real estate market and how they were being leveraged to compromise public officials, Cooper mentioned how it was the then-Director of Money Laundering that leaked information to him related to British Columbia’s casinos being leveraged to money launder illicit profits.  Cooper explained that the director and other high-ranking officials had raised the issue with different provincial governments over the years but were entirely disregarded and avoided.  Fed up with all the inaction and willful blindness, they reached out to Cooper to share what was transpiring at the highest levels of government.

Laviolette inquired about the situation in the province of Ontario.  Cooper’s response was that Ontario was just as bad as the province of BC had been prior to Premiers John Horgan and David Eby—before BC declared a war on money laundering and began enacting new laws.  The city of Toronto was estimated to have had billions of dollars that were laundered through different banks, with all the money getting traced back to organized crime.  There was a major issue with financial integrity, he said, across all major municipalities across Ontario.

At one point in the discussion, Laviolette asked about the extent that Canadians were aware that Canada might have a serious problem with corruption and organized crime, to which Cooper responded by saying that information rarely gets communicated to Canadians holistically and is often obfuscated.  Cooper also mentions how Canada’s public safety stakeholders have long been asking for new laws and highlighting Canada’s vulnerabilities and the inability to prosecute and stop criminal activity.  Furthermore, just like the illegal underground casino issue, there was also an issue with illegal underground banking, and that organized crime had established a deep foothold within Canada.  And there was also the emergence of a new problem around digital assets and how some blockchain companies had sketchy backgrounds, and that there were assets for cash networks across Canada, from Toronto and Markham to Vancouver and Richmond.

What may shock listeners the most is that Cooper took the position that Canada was not headed in a good direction, that there were ties to corruption everywhere, and it was tied in with bureaucratic circles.  Despite that the RCMP had been long aware that organized crime was interconnected and influenced by hostile states, there were still problems.  One of the RCMP’s highest ranking civilian members, Cameron Ortis, who was convicted for leaking national security secrets, was unlikely the sole source of leaks.  Instead, Cooper’s sources suggested that there are many more like him scattered across the RCMP and elsewhere.  In short, he suggested Canada was potentially on the verge of a bubble burst moment when it came to organized crime.  But Cooper believed that it was possible for Canada to follow the in the path of US with RICO laws that dismantled ethnic Italian organized crime as well as how Japan decided to purge the Yakuza from their democratic institutions.

At the end, Cooper reiterates the message that Canada is not free from corruption and that our peaceful lifestyles should not mislead people about how vulnerable our democratic institutions truly are.  The question that Cooper concludes with, and suggested we ask ourselves was, “are we so compromised that it is the reason why we don’t have laws against organized crime?”

BC Premier David Eby continues to lead the fight against organized crime with new legislation.

What makes organized crime and money laundering possible can be traced to three key sectors: banking, accounting, and law.  While there has been success with addressing the role that bankers and accountants play in helping organized crime with money laundering, little has been done to address the role that lawyers play in assisting organized crime.  It has been another problem that investigative journalist Sam Cooper has highlighted, saying that many prominent lawyers and law offices are basically working for organized crime actors and foreign states, and that many law offices were some of the biggest proponents against RICO laws.

One public official who has taken note of the issue and is leading the battle to put an end to organized crime and their money laundering activities is BC Premier David Eby.  Canada’s provinces might need to pay close attention to what BC is attempting to do with the introduction of Bill 21 – the Legal Professions Act.  Premier David Eby wants to see a single provincial regulator for lawyers, notaries and paralegals, instead of having the law society regulate themselves.

With Bill 21 getting royal ascent, the final step in the legislative process, after which the bill becomes law, the Law Society of BC has announced that it plans to challenge the bill’s constitutionality.  However, there are many complaints that law societies will not accept that they probably should and other times where they lack the formal powers and resources of the Crown to prosecute criminal lawyers.  Another reality is that law societies sometimes lack the legal authority to intervene in certain situations, and they can only do so if the matters get raised in court and a presiding judge makes negative comments on the conduct of a lawyer.

One thing that seems true is that there are too many grey areas that ensure that lawyers can do whatever is necessary to “protect their client’s interests”.  Those grey areas give rise to the “structural barriers” and create “systemic challenges” that impede a law society’s ability to go after lawyers who are working with organized crime groups.  Because of the difficulties these structural barriers create, it is impossible for law societies to address many of the problems that arise in a manner that a provincial regulator could, especially with instances related to organized criminal activity.

A constant in the conversation on organized crime and money laundering, that national and international policing agencies, as well as other public safety stakeholders, are echoing, is that without accountants, bankers, and lawyers, organized crime groups and money launderers would be severely restricted in their ability to function.  This understanding has also been acknowledged by the Foreign Interference Commission, and Commissioner Marie-Josee Hogue has also raised the issue at different times during Stage I of the Public Inquiry into Foreign Interference.

Outside of the Public Inquiry into Foreign Interference, the importance of the example that Premier David Eby is setting by going after organized criminal networks and the threat they pose by introducing sweeping reforms might only be comparable to the importance of the example that Premier Tommy Douglas set by redesigning Canada’s approach to health care.  For Premier Douglas, that example set him up to be considered as one of the greatest Canadians of the 20th century, and Premier Eby is on a similar trajectory for Canadians of the 21st century.

Whatever the plan is for Stage II—once it commences in the Fall of 2024—the interconnected nature between foreign interference, domestic interference, and organized crime is no longer avoidable.  Nor is the enabling role that accountants, bankers, and lawyers play in making organized crime possible.