Speaking Notes for Sarah Paquet Director and Chief Executive Officer
As part of a panel on Following the Money: Trends in Financial Crime and the Funding of Illicit Activities at the 91st Annual Ottawa Conference on Security and Defence
From: Financial Transactions and Reports Analysis Centre of Canada (FINTRAC)
March 10, 2023
Check Against Delivery
I'd like to thank the Conference of Defence Associations and the CDA Institute for the opportunity to speak at this longstanding and premier conference on security and defence.
Before I begin, I want to acknowledge that I'm speaking to you from the traditional and unceded territory of the Algonquin Anishinaabeg People.
The Threat Posed by Money Laundering and Terrorist Financing
I'm pleased to join my fellow panelists to discuss the threat to Canada and Canadians posed by money laundering and terrorist financing.
It's important to recognize that the overwhelming majority of crimes committed in Canada and across the globe are committed for profit. And these crimes – whether it's drug trafficking, fraud, human trafficking, or online child sexual exploitation – threaten our communities and our most vulnerable citizens. They are NOT victimless crimes.
Human traffickers, for example, exploit their victims primarily for financial gain. This appalling activity, which targets women under the age of 25, including minors, is happening every day across Canada – in major cities like Toronto and Vancouver and in smaller centres such as Regina and St. John's – and victims from all walks of life are falling prey.
According to the Criminal Intelligence Service Canada, there are more than 1,850 organized crime groups believed to be operating in Canada, with many of these groups involved in money laundering and operating internationally.
In order for these groups and other criminals to enjoy the proceeds – the profits – from their crimes and support their other criminal activities, they need to launder their money through the legitimate economy.
Beyond the direct threat to Canadians, money laundering undermines the integrity of our financial system and harms Canada's legitimate economy: it distorts market prices, creates unfair competition and damages the reputation of our financial sector.
More broadly, money laundering fosters corruption and leads to the erosion of public institutions and the rule of law, lower government revenues and a loss of credibility and influence internationally.
Terrorists and those supporting terrorism also look to exploit Canada's financial system to facilitate their devastating activities. Whether its individuals engaged in ideologically motivated violent extremism here in Canada, extremist travellers or international terrorist groups, we have seen how they move their money to facilitate their terrorist activities.
The key to combatting money laundering and terrorist financing rests in following the money and leveraging the power of financial intelligence to help target, disrupt and dismantle the organized criminal and terrorist networks that threaten Canada and Canadians.
FINTRAC's Role within Canada's AML/ATF Regime
With exactly this in mind, the Government of Canada has a comprehensive regime in place to combat money laundering and terrorist activity financing. Led by the Department of Finance Canada, Canada's Anti-Money Laundering and Anti-Terrorist Financing Regime consists of 13 federal departments and agencies, including the RCMP, FINTRAC, the Canada Border Services Agency, the Canada Revenue Agency, CSIS and the Public Prosecution Service of Canada.
Within the private sector, more than 24,000 businesses – including banks, casinos, money services businesses, real estate and others – play a critical frontline role in Canada's efforts to combat money laundering and terrorist financing. These entities are required to identify their clients, keep records and report certain types of financial transactions such as international wire transfers and suspicious transactions.
With the reporting that we receive from Canadian businesses, we are able to generate actionable financial intelligence for Canada's law enforcement and national security agencies. Last year, we provided 2,292 financial intelligence disclosures in support of money laundering and terrorist financing investigations across Canada and around the world – or more than six disclosures every single day.
Our financial intelligence contributed to 335 major, resource intensive investigations last year as well as many hundreds of other individual investigations at the municipal, provincial and federal levels across the country, and internationally.
Our financial intelligence was recently recognized by the Alberta Law Enforcement Response Team in relation to Project Collector, a three-year investigation that resulted in the dismantling of a professional money laundering organization that was working in support of some of Canada's largest crime groups. Seventy-one charges were laid against seven suspects, including participation in a criminal organization and laundering proceeds of crime.
Given the transnational nature of money laundering and terrorist activity financing, we also work with financial intelligence units across the globe to protect Canadians and the integrity of Canada's financial system.
With over 100 bilateral agreements, we are able to disclose financial intelligence to our counterparts worldwide when appropriate thresholds are met. At the same time, foreign intelligence units are able to share their information with us, which broadens our analyses of international financial transactions.
Following the Russian Federation's unjustified invasion of Ukraine, we worked with our closest allies – including the United States, Australia and the United Kingdom – to establish the Russia-Related Sanctions and Illicit Finance Financial Intelligence Units Working Group. Over the past year, members have worked within their respective authorities to surge the sharing of tactical financial intelligence and develop a common base of understanding through the dissemination of strategic-level intelligence on a variety of related issues.
With some of our closest partners, we also recently launched a new international public-private partnership targeting the money laundering associated with illegal wildlife trade. While endangering the global environment and countless species at risk, this heinous activity is also a major transnational organized crime, which generates approximately 20 billion dollars in criminal proceeds each year. These proceeds are, in turn, used to facilitate other serious crimes across the globe, including here in Canada.
By following the money and generating actionable financial intelligence for law enforcement in Canada and around the world, this international public-private partnership, named Project Anton, will be critical in identifying, pursuing and prosecuting perpetrators – and broader networks – linked to illegal wildlife trade.
I look forward to our discussion this morning – and answering any questions the audience may have in relation to our work in combatting money laundering and terrorist financing here in Canada and with our partners internationally.
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