Proceedings of the Standing Senate Committee on
Legal and Constitutional Affairs
Issue 8 - Evidence for May 13, 2009
OTTAWA, Wednesday, May 13, 2009
The Standing Senate Committee on Legal and Constitutional Affairs met this day at 4:01 p.m. to study Bill S-4, An Act to amend the Criminal Code (identity theft and related misconduct).
Senator Joan Fraser (Chair) in the chair.
[Translation]
The Chair: Welcome to this meeting of the Standing Senate Committee on Legal and Constitutional Affairs. We will begin our study of Bill S-4, An Act to amend the Criminal Code (identity theft and related misconduct).
[English]
This is an extremely interesting bill. We have the pleasure of having with us as our first witness on this bill the sponsoring minister, the Honourable Rob Nicholson, P.C., MR.., Minister of Justice and Attorney General of Canada. He is familiar with this committee and has had cause to appear before us a number of times because that is the nature of being the Minister of Justice: You get to appear often before the Legal Committee.
We are glad to welcome you, minister. We await with interest your opening statement and then will ask you questions. The floor is yours.
The Hon. Rob Nicholson, P.C., MR.., Minister of Justice and Attorney General of Canada: Thank you very much, Madam Chair. I am always pleased to appear on behalf of another piece of justice legislation. I welcome the new members of the committee and thank Senator Wallace for introducing this bill at the Senate level. It is much appreciated and is something that will be welcomed across this country.
The amendments contained in Bill S-4 address the growing concerns about identity-related crimes in this country. The criminal misuse of identity is not a new problem, but it has taken on a new life and new dimensions. This is what law enforcement agencies and across this country have been telling me.
[Translation]
Criminals have always hidden their true identities and used fake ones. What has changed in recent decades is that we are putting more and more trust in technology.
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We enjoy much greater security and protection, but criminals also enjoy new opportunities to obtain greater illicit benefits at less risk. The government believes these new threats can and must be addressed in the Criminal Code.
In Canada, we have always had some identity-based offences. This includes most directly the offence of personation and also secondary offences such as forgery of documents — including identity documents — fraud, misuse of credit cards and offences to protect specific forms of identification, such as the Canadian passport.
This bill makes some changes to modernize these long-standing offences. However, its main purpose is the creation of new offences that focus specifically on the early stages of abuses of identification and identity information.
These new offences can be applied before offenders have a chance to misuse personal information. We believe this is important for several reasons. First, it recognizes that, in the modern era, identity crime generates distinct groups of victims. The economic harm to victims of secondary offences, such as fraud and credit card misuse, has always been addressed by the Criminal Code. However, people's reputations, credit-worthiness and even criminal liability may be affected. These victims suffer harm whether other crimes are committed with identity information or not and the damage is very difficult to correct.
Second, the proposed new measures will close gaps created by new technologies and new crimes. Taking physical documents may be theft under existing law, but simply copying information is not addressed by traditional property offences. In this context, criminal groups have learned to specialize and cooperate with one another. One may steal or fabricate information, another may produce physical or electronic documents for sale, and the end users of the identities then commit other crimes with them.
Third, from a more practical standpoint, the new offences enable law enforcement agencies to become engaged at earlier stages of the criminal schemes. This could result in a reduction of more serious types of victimization.
Fourth, identity-related crime is a rapidly expanding problem at the international level. The government has been engaged in raising this issue in international fora for some time. I raised it myself with the G8 justice ministers in Tokyo last year, and I will be raising it again with my colleagues this year to make them aware of the implications and the challenges we all face.
By bring forward these amendments, Canada will be sending a strong message to other countries that we take the problem seriously and are committed to doing something about it.
I propose to leave some of the more technical amendments for your questions, but I will now turn to what I believe are the key amendments in the package. The first element of the bill would form a new section 56.1 to the Criminal Code and criminalize the procurement, possession, transfer, and sale or offering for sale, of specific physical identity documents. At present, simply possessing or trafficking in other people's identity information is not a crime, and we believe that it should be, of course, subject to the appropriate exceptions.
We have provided those exceptions in proposed new subsection 56.1(2) and, as an added safeguard, the offence also allows for other lawful excuses of a more general nature. For example, a person caught trying to enter Canada with a collection of different passports would probably trigger an investigation, but obviously a parent in possession of a child's passport would have a lawful excuse.
The second key amendment, and the most important change in the package, is composed of four elements: The establishment of a new definition of "identity information"; a new offence of identity theft; a new offence of trafficking in identity information; and the modernization and expansion of the old offence of personation, resulting in a renamed offence of identity fraud.
The proposed new identity theft offence deals primarily with obtaining or possessing identity information in circumstances that show intent to commit one of a series of other related offences. A related offence will be established to cover trafficking in information and knowing or being reckless as to whether it will be used for one of those same offences. Both offences will be guided by a broad definition of identity information, which covers all the types of information that can be used to identify a person.
It is important to note here that, based on the definition, these offences are directed at the mishandling of information. It will not matter whether that information is contained in an official identification document or whether it is merely copied or stored in some other form.
The bill also modifies the offence of personation, the actual impersonating of another person by renaming it "identity fraud." It also clarifies that misuse of a real person's identity for the purpose of evading criminal liability is captured in addition to other improper purposes.
Bill S-4 also allows for an order that the convicted offender pay restitution of the costs of repairing or restoring identity for these offences; and why not? We should be helping out these victims who have been victimized by these individuals. We believe that creating an offence of identity theft, which targets the collection and possession of identity information, coupled with the existing offence of identity fraud presents a more coherent picture of the various stages of identity crime.
Bill S-4 also clarifies and extends certain existing offences in the Criminal Code. The bill will improve the law in relation to credit and debit card offences, misconduct in relation to the mail and the forgery regime.
Finally, in proposing these amendments, the government realizes that officials from legitimate investigative agencies often must conceal their identities or impersonate others in the course of undercover investigations. To ensure that law enforcement can work to keep Canadians safe from crime, the bill excludes law enforcement from offences in relation to forged documents for otherwise lawful conduct undertaken in the course of their duties or employment. Agencies that produce identity documents are also exempt if, in good faith and at the request of a government agency, they make false identity documents for use in covert operations.
Madam Chair, this concludes my summary of what I believe to be the key elements of the package for this important piece of legislation. I will do something now that I perhaps should have done at the beginning and introduce Joanne Klineberg from the Department of Justice, who is an expert on the elements of this bill. I am very pleased that she is joining me today.
The Chair: I was the one who should have introduced her, and you took the words out of my mouth. I apologize, Ms. Klineberg. We are very glad to have you with us.
Senator Wallace: Minister Nicholson and Ms. Klineberg, I welcome you here today and thank you for the presentation.
I would like to begin, since I am the sponsor of this bill in the Senate, by saying how proud I was to stand with you, minister, and a number of stakeholders when you announced the tabling of Bill S-4. Those stakeholders, as you will recall, included representatives from Visa, MasterCard, American Express, Interac Association, Equifax and the Canadian Bankers Association, who all applauded you for bringing forward this much anticipated and necessary legislation.
I would like to take a moment to quote from the press release that was issued by the Canadian Bankers Association, which quotes their president, Nancy Hughes Anthony:
"Currently Canada is the only developed country without legislation designating identity theft as a crime," said Ms. Hughes Anthony. "With this legislation, Canada is poised to move from the back of the pack to the front, because we will have some of the most comprehensive legislation against identity theft in the industrialized world."
Identity theft, the theft of personal information, is currently not illegal but it can lead to a wide variety of crimes — from financial fraud and forgery to real estate fraud and the abuse of government programs.
"It is important that law enforcement agencies have the tools necessary to stop criminal activity at its earliest root source," said Ms. Hughes Anthony. "There is an urgent need to make identity theft a defined offence — an actual crime — in Canada and we urge all parties to join together and pass this legislation quickly."
Ms. Hughes concluded by stating:
"Minister Nicholson's legislation represents concrete action in the fight against identity theft and we applaud and support his efforts to protect Canadians."
Minister, I know this legislation has been well received by the stakeholders, which is obvious. Is it your sense that this legislation has been well received by Canadians in general?
Mr. Nicholson: It did get pretty good feedback, Senator Wallace. Again, thank you for introducing this bill in the Senate. Canadians know that this is a growing problem. I myself was a victim of identity theft to the extent that my credit card information was transferred to someone in Calgary. It was of interest to me, but the woman who called to inform me did not know who I was or any connection I had. When she called my home to talk to me about this, she said, "I should let you know this is a growing problem in Canada." I said, "You have no idea how interested I am in this subject quite apart from the fact that you are calling me on this."
I have been to Montreal a few times where I sat with people from law enforcement agencies, and they have indicated to me things that I have heard in other communities as well, which is that this is becoming more sophisticated and that the laws have to catch up with what is happening. Our criminal laws were written at a time when the thought was that all crimes were confined here to Canada and this is what happens. Well, these crimes are not confined to Canada any more. Many times this information gets shifted in a split second outside of the country. In fact, the production of the illegal credit cards or the other misuse of people's personal identification many times is not done in Canada. We have this gap in the law where these people who are collecting all this information are not being prosecuted because of gaps in the law.
This is a challenge we always have, frankly, with the Criminal Code of this country. It is not just a question of getting tough on crime. Most of us want to do that, or believe that is important. A bill such as this is basically filling the gaps on the existing Criminal Code legislation. It is something we have to do, and I think it is important. I have had nothing but positive feedback on this bill. I cannot say that for all the legislation. I get pretty good feedback on all of it, but this is almost unanimous in terms of people wanting to move on it.
I cannot say we are the only country in the world not to have this, or the western industrialized countries. The Europeans have a slightly different take on this. Certain legislation in certain European countries is focused on people's financial loss, but it is not just a financial loss when people steal your identity. There are other components to that. I certainly encourage my European or G8 colleagues to look at the whole area and expand people's protection.
Senator Wallace: We all see the changing times we are in and this new reality that is upon us. Every one of us receives mail at home. I know that nothing that comes into my house with my name or address on it goes into the garbage until it goes through the shredder. We all live in fear. That is a recent phenomenon for most of us. In that regard, my sense is that a sense of urgency and timeliness exist to move this bill into law. I am wondering if you would care to comment on that sense of urgency.
Mr. Nicholson: I believe that this is universally welcome to the extent that people focus on this. People are more aware of the challenges with respect to identity and identity theft and how easy that is. At the press conference you and I attended, it was estimated that it is a $2-billion-a-year problem in this country. This is huge. We know that with some of these technological crimes it gets worse. It levels off. Increasing numbers of people become involved in this, particularly if there is a perception that a gap exists in Canadian law. It is incumbent upon us all to move on this. I would like to see it moved through and receive Royal Assent by the end of the session.
Senator Baker: Welcome, minister. When the bill was originally introduced into the House of Commons last year or the year before, it encountered stiff opposition in relation to the shenanigans of the committee examining it, and it died in the committee. I can give you assurances that there will be no such shenanigans here. We will judge the bill on its merits and listen to the witnesses, which they did not do in the House of Commons. That is why you have now introduced it into the Senate first. You are getting sober second thought in the first place without waiting for it.
Senator Angus: Without thinking.
Senator Baker: That was Senator Angus who said, "Without thinking."
I will ask a few questions that I am sure will concern the witnesses who will be appearing before this committee as we examine the bill.
Bill S-4, under the heading "Official Documents," defines "identity document" in proposed new subsection 56.1(3) as follows:
For the purposes of this section, "identity document" means a Social Insurance Number card, a driver's licence, a health insurance card, a birth certificate, a passport as defined in subsection 57(5), a document that simplifies the process of entry into Canada, a certificate of citizenship, a document indicating immigration status in Canada or a certificate of Indian status, issued or purported to be issued by a department or agency of the federal government or of a provincial government, or any similar document issued or purported to be issued by a foreign government.
That is it; no other documents are considered to be an identity document. Therefore, a person looking at this, on the face of it, would ask why you are restricting identity documents, under the general heading "Official Documents," to a restricted list that will not take into account any other identity document that may be of use.
Mr. Nicholson: This carves out a special section. It is not exclusive in that there are no other provisions directed toward identity information or some type of identity card. It creates a specific offence with respect to government-related documents. There is a very low threshold that a person who simply possesses one of these items without lawful excuse is guilty of an offence. We think it would go too far if we said, of every bit of information that could possibly be gathered, that it would be an offence, in and of itself, to possess that. With government documentation, if you do not have a lawful excuse why you have other people's passports, for example, in your possession, we carved out a specific offence.
Your question is whether the list is complete. It looks to be a fairly extensive list of government documentation. Let us know if you can think of some other government documentation. We have carved out this specific offence, but it does not mean, nor should we give the impression, that the rest of the bill does not talk about the transfer of all types of personal information not directly connected with government documentation.
Senator Baker: Senator Wallace referenced people being concerned about identity theft and receiving items in the mail. A large portion of this bill deals with the mail. I do not know if you have turned your mind to this. The identification of a social insurance number as an identity document has been decided by the Personal Information Protection and Electronic Documents Act, PIPEDA. Judgments are given every week by the Privacy Commissioner as to whether federal institutions or institutions that come under federal jurisdiction are breaking the law with the use and release of personal information.
Mr. Nicholson: That is correct.
Senator Baker: For example, the banks came under fire. It was judged to be an offence under the act to use a social insurance number to identify someone on their documents.
I am sure that we will have people appearing before the committee who will say that the government uses our social insurance numbers to identify us as senior citizens. When we get a senior citizens card — which you will receive one of these days, like I did a few years ago — you will see that the identity number is your social insurance number. When someone receives Old Age Security in Canada or Canada Pension in the mail — not registered mail — it includes their name, address and social insurance number, their identity, and access code to the Internet to access their account.
Have you turned your mind to assembling information to examine government violations in this area and to say that to various government departments that they cannot be sending peoples' social insurance numbers through the mail or use it as an identity?
Mr. Nicholson: You are referencing the PIPEDA, but the bill we have before us is not directed toward that. That is not to say that it is not an important subject, and privacy concerns are always a concern for government. This bill is confined specifically to the misuse of information. You will notice that each section, as you go through clause-by-clause consideration, always has a disclaimer: without lawful excuse or without lawful authorization. People using information for a legitimate purpose are specifically excluded in all cases throughout this bill. It specifically targets organized crime. That is who they tell me is involved with this activity. Organized crime syndicates are collecting this information, shipping it outside the country and using it for illegal purposes.
That issue is an interesting subject for a different bill or another time, but this bill is not directly making any amendments to PIPEDA or anything else. This bill is specifically designated to target the misuse of people's information for criminal purposes.
Senator Baker: Finally, you referenced this question in your opening address. It is a proposed new section of the bill that may concern certain witnesses who may appear before the committee. The proposed new section 368(1)(c) says that if you transmit another person's identity information or have it in your possession, "knowing that or being reckless" as to whether the information will be used to commit a crime.
Are you concerned that the expression "being reckless" would perhaps lead to unjustified prosecutions under this act?
Mr. Nicholson: I do not think so. I looked at that when we introduced this approximately one year ago. We want to get that individual who says that he or she did not pay any attention at all and was only collecting information and sending it to a good friend who happened to be south of the border, that he or she was only helping out.
We have to get that individual who was reckless in assembling people's information and shipping it somewhere to someone else for an illegal purpose. He or she is a part of the chain; and we cannot have those people saying that they do not think about these things and only like to gather people's information. We have to get all people who are reckless or intend to participate in a criminal enterprise.
The Chair: Is there not a difference between someone who is reckless and someone who has criminal intent and criminal associations?
Mr. Nicholson: The term "reckless" is use a number of times in the Criminal Code. People who conduct themselves in a reckless manner can find themselves subject to criminal liability. We are applying it in this case as well.
The Chair: I think that is the area that Senator Baker may wish to resume on the second round.
Joanne Klineberg, Counsel, Criminal Law Policy Section, Department of Justice Canada: It is true that the term "recklessness" is used in a few sections of the Criminal Code. It has been interpreted by the courts to mean a standard that is only slightly less than actual knowledge or intent. The courts say that "recklessness" means awareness of a substantial risk that something would happen, actual subject of the awareness of the risk that it would happen and a decision to proceed with the behaviour nonetheless.
It is somewhat more than a mere inadvertence or not turning your mind to it. You actually must perceive the risk. It actually would be even more than gross negligence. Gross negligence would be a case of inadvertence that rises to the level of being very dangerous. Recklessness would require proof of a subject of awareness of the risk on the part of the accused, but not knowledge necessarily, only knowledge of the risk.
Senator Milne: Minister, I am made to feel more comfortable by proposed new subsection 56.1(2) that says:
For greater certainty, subsection (1) does not prohibit an act that is carried out . . .
(b) for genealogical purposes; . . . .
I am the family genealogist, but this line of questioning by Senator Baker has the hair on the back of my neck standing up. I regularly send personal information about people who contact me because they want more information about the Milne clan, and I send it to them. I have absolutely no idea how they are going to use it. They tell me they are genealogists. Of course, they probably are, but nevertheless, I might be being reckless.
Ms. Klineberg: Unless some circumstances could be demonstrated that would have given rise in your own mind of a serious risk that someone would use the information for criminal purposes, you would not be being reckless. If you failed to turn your mind to the question at all, or if you just assumed that the purpose will be lawful, that would not count as recklessness under a criminal law standard.
Senator Milne: Let us hope that gets me off the hook sometime in the future.
Following from what Senator Baker was saying, current Canadian law imposes limits on how long organizations engaged in commercial activities can retain personal information. It is not to be stored in perpetuity by these organizations. I understand that the Privacy Commissioner and the BC Freedom of Information and Privacy Association have noted that the risk of identity theft in the private sector would be significantly reduced if this law was actually obeyed by organizations — specifically, the law on personal information in section 4 of the PIPEDA.
I suspect from your answers that you agree with me, but why are we not doing more right now to have the government do more to enforce the laws that already exist that would help with this issue considerably?
Mr. Nicholson: The government is concerned about protecting Canadians from breaches involving loss of personal information stored by companies. Again, the legislation I have is not directed toward the Personal Information Protection and Electronic Documents Act. You are right. There is information. There is legislation with respect to privacy, and it should be enforced, of course, by all law enforcement agencies. All government agencies should be very careful.
We are not dealing today with amendments to that particular act. We are dealing with criminal activity, namely, people assembling information for criminal purposes or the theft of people's personal information. It was not meant to be an amendment to the PIPEDA.
Senator Milne: I know that. If we already have one act that is unenforceable, why are we bringing up another act that I strongly suspect will be unenforceable as well?
Mr. Nicholson: I do not agree that PIPEDA is unenforceable. It can and should be enforced, and people should comply with the provisions and be careful.
We are always looking at better ways to protect people's personal information that is held by the government or the companies. Again, we do not mind addressing these issues. We do not mind looking into them, but this bill is specific to the gaps that are in the Criminal Code with respect to the theft of people's identity.
Senator Milne: Minister, I applaud the purpose behind this act.
Mr. Nicholson: Good.
Senator Milne: I also note that almost every one of the bills that we see coming down the pike toward this committee have mandatory minimum sentences set out in them, but not in this bill.
Mr. Nicholson: I always try to keep an open mind, if you are suggesting an amendment.
Senator Milne: Why is that, minister? Is this just an oversight, or do you intend to bring in another bill to correct that?
Mr. Nicholson: We are always looking for guidelines, and that is our responsibility, senator. You might ask why we are putting maximum sentences here; it is because we give guidance to the courts. On each of these offences, we do give guidance, and we put maximums.
I remember years ago, as a member of the standing committee on justice, one of my colleagues asked why the maximum was only five years and suggested giving judges the ability because they might find it is worth seven or ten years.
We have to judge these in connection with other sections of the Criminal Code, and that is why the maximum on that particular offence was only five years, even though I had colleagues in my own party who thought it should be seven or ten years. Again, that is our job as parliamentarians, to give maximums. Sometimes we give minimums. We give guidance to the courts. I think it is a good way to handle it.
Senator Milne: It is minimums I am talking about.
Mr. Nicholson: We are not putting in any minimums.
Senator Milne: Have you any evidence whatsoever that mandatory minimums work?
Mr. Nicholson: I hear it all the time, senator, that we have to send the correct message out. We have a bill directed at people who, for instance, are bringing drugs into this country and are involved almost exclusively with organized crime, namely, criminal gangs bringing drugs into this country. In that case, we have mandatory jail terms because we want to send out a clear message that says that people bringing drugs into the country are in the business of destroying Canadian lives. We have to send out a message. We give that guidance to the courts. We do not have them on all bills and not on the bill before you. However, if you look at the penalties in it, they are reasonable and give the guidance that is our responsibility to give the courts.
Senator Milne: I notice, Madam Chair, that the minister has not given us any idea whatsoever that mandatory minimums work, and since they are not in this bill, I will subside at this point.
Senator Nolin: We will have a bill soon that will discuss exactly that.
The Chair: There are a number, I do believe.
Senator Nolin: We will be privileged to have the minister come back.
The Chair: I have a question on this line, minister, that may surprise you, coming from someone who sits on our side of the chamber, and it has to do with maximum sentences. As an example, the maximum for stealing anything sent by post is ten years, but the maximum for impersonating a police officer is only five years.
Ms. Klineberg: Sometimes when we amend the Criminal Code, anomalies appear. In this particular case, we currently have section 356 of the Criminal Code, which provides a number of offences in relation to Canada Post. It does have a ten-year maximum, so as we were adding offences to that existing offence, the decision was made to keep that penalty the same, at ten years.
In relation to impersonating a peace officer, that currently is a summary conviction offence. It is being hybridized in this bill, with the penalty being increased to five years. As the minister has suggested, it is sometimes a challenge to determine what maximum penalties should be and what the nature of the guidance you want to give the courts should be. If you look at the elements of that offence, it is one which, relative to the other identity theft offences that were created, we thought would be consistent.
Senator Bryden: With respect to the difference of the penalties, it is interesting to me that in proposed new section 368.1 of the bill, everyone is guilty of an indictable offence and liable to imprisonment for a term of not more than 14 years if various things happen, which are happening all through this.
Why was this one chosen to have a maximum of 14 years, while another one has a maximum of 10, and the others have maximums of 5? I am a great believer that it does not matter what the maximum is but whether you get caught or not, and that is the difficult part.
Mr. Nicholson: We tried to make them consistent with sections already in the Criminal Code. There are those, senator, who have said from time to time that what we should do is start from scratch in the Criminal Code, and try to reconcile every section of the Criminal Code.
You can appreciate that getting even minor amendments sometimes can be a challenge. I do not have the nerve to tackle the question of revising the whole Criminal Code. Again, making it consistent with the sections that we are placing it in sometimes guides us on what those would be. As you point out, we seldom see the maximum sentences being given out, but they are there as guidelines.
Senator Joyal: Minister, if you allow me, as part of my opening remarks, I would like to draw your attention to one of the honourable senators around this table, our colleague Senator Angus, who has been granted the merit medal of the Quebec Bar this year.
Senator Baker: Well deserved.
Senator Angus: Thank you.
Senator Joyal: Minister, my first question is in relation to clause 11 of the bill, which amends subsection 738(1) of the Criminal Code, entitled "Restitution." This is a very important amendment to the code because it adds the principle of dommages et intérêts, at least in the French version, and that is where I was struck by the concept of dommages et intérêts, which is, of course, mainly a civilian notion.
With the proposed changes, we would have to read subsections 738(1)(a), (b), (c) and (d) concurrently or in isolation. If I read subsection 738(1)(a), maybe I should say that it is the damages that could be granted by the court when the court has recognized that the person is responsible for the act.
Therefore, subsection 738(1)(a) would allow a judge to grant repair in the case of loss of property. Suppose that someone stole the identity of someone and that leads to the loss of the house; we know that has happened. There was a scheme among real estate agents and so forth recently. You might have heard of it.
Mr. Nicholson: Yes.
Senator Joyal: Then if I read section 738(1), a person who is found guilty could be fined by the court the amount of the damages that are equivalent to the loss of the property, which would be the house in that case.
Then you add proposed new subsection 738(1)(d), clause 11 of your bill, which reads that the judge can grant damages equivalent to the cost of re-establishing their identity. In other words, it would be the cost incurred in getting a new credit card, a new passport and so forth.
I applaud that, even though it raises a very fundamental question, in my opinion, which is to introduce the notions of dommages et intérêts in the Criminal Code. It is a very fundamental change to introduce that into the code. Since you do that, to compensate the person for the cost incurred to re-establish his or her identity, why do you not also cover the other costs that a person might have incurred? For instance, someone might be responsible for all sorts of expenses that have been made on his or her behalf and, of course, the person would find himself or herself open to litigation because of that and not able to be compensated by the person who authors the fraud.
It seems to me that if the principle is good for the loss of property, it should be good for other damages or expenses that the person was led to incur, other monetary losses, because his or her identity has been stolen.
Mr. Nicholson: I believe that would be covered under subsection 738(1)(a) of that as well. In your case, the person who has lost the house would be able to be provided for under subsection 738(1)(a), so, in a sense, we are adding other expenses that may be collectible.
Senator Joyal: I understand the house is covered by subsection 738(1)(a), but the person might have incurred other expenses because his or her identity has been stolen and the person has been found responsible for it.
The Chair: A credit card bill is not property.
Senator Joyal: Property, to me, is a building.
Mr. Nicholson: I will ask Ms. Klineberg to comment on that one, senator.
Ms. Klineberg: It becomes a difficult question of how remote and how far removed are the full set of consequences of the crime. The direct costs associated with rehabilitating your identity would be covered. Whether or not additional costs, such as being involved in a civil litigation action, should be covered is a very difficult aspect to balance with respect to how far you want to use the criminal law restitution power to deal with what is essentially a civil law matter. There was some concern that if we allowed restitution of many things that require a civil court to engage in a fact-finding process, to balance and measure exactly what the costs were, it would be too onerous for a criminal court in the context of a sentencing hearing to evaluate what those costs are. Those costs, as well, might not be known at the time of sentencing an offender. If there is some sort of civil action where the person has to clear, for instance, a false mortgage that was taken out on their property, it might take quite some time to determine what the true costs of discharging that mortgage would be. They would not necessarily be readily ascertainable at the time of sentencing the offender.
If you notice throughout subsections 738(1)(a), (b), (c) and proposed new subsection (d), all of the costs that are recoverable through restitution must be readily ascertainable. The point is that at the time of the criminal trial, the criminal court has to be in a position to be able to concretely say what the costs are in order to be able to order restitution. Once you fall outside those bounds, you are in the domain of civil law and civil restitution.
Senator Joyal: I do not want to prolong the argument, but it seems to me that the line is very thin between being responsible for a mortgage on a property of someone else and losing your own property because your identity has been stolen by someone and your property is sold. It has happened. As you know, we have examples of that.
When it is clear that the damage is there, the mortgage has been registered and you can see the amount because it is there, registered, and it is a real issue in that it is tangible — when the damages are tangible, as that seems to be your preoccupation in terms of concept — I do not see why we could not have a definition that allows for an expansion of the financial responsibility of the author of the fraud.
Ms. Klineberg: I would say only that it would be a question of being able to say that we could be precise about what the nature of those costs would be at the time of the sentencing.
Mr. Nicholson: If it is anything other than that, senator, you know what would happen: The whole matter would be delayed, and you would be getting into another area, which opens the question of civil damages. You and others might say that we are going too far into provincial jurisdiction, that there are civil remedies for lawsuits to proceed and ask why we are getting into this.
This is clean, to the point, precise and easily attainable at the time of sentencing. We do not want to have anything that would delay sentencing.
Senator Joyal: As I say, the damages are tangible, as in the example I have given of a mortgage. It is quite tangible; it is easy to define, to identify. The amount is in the paper.
Mr. Nicholson: Again, senator, this is an improvement over what we have right now. It is a step in the right direction.
Senator Joyal: I am not saying that I am opposed to it.
Mr. Nicholson: I know what you are saying. You are asking why we are not going further. Usually that is not what I get when we introduce legislation. What we have is definable, defensible and a step in the right direction.
Ms. Klineberg: In the case of mortgages, the provincial level has seen increased activity in a variety of provinces. As you mentioned, senator, we have had a number of fraudulent mortgages. In a very high-profile case in Ontario, the Court of Appeal for Ontario actually said that it was the property owner who was responsible for the fraudulent mortgage even though it was the mortgage lender who did all of the paperwork. They subsequently reversed themselves in that particular decision, and provincial governments, as well, have now been legislating in this area in order to allocate any losses in terms of a fraudulent mortgage to the lender and not to the home buyer.
Just specifically with the case of fraudulent mortgages, activity at the provincial level is resolving these issues to the benefit of the property owner.
Senator Angus: Welcome, minister and Ms. Klineberg. Thank you for coming and for your initiative in bringing this law forward. In the last 10 years here, if one subject matter has repeatedly come to my attention as a member of the Standing Senate Committee on Banking, Trade and Commerce requiring study and government intervention and legislation, it has been identity theft.
Based on my understanding from your evidence, this is a first step — or a further step of many — but directed, as you say, more at the macro or organized crime aspects of it where there appears to be evidence of an international clearinghouse. That is what I would like to pursue a bit, if I may.
In Montreal, which I gather is one of the worst centres for this theft, we see cars, especially late model cars, broken into willy-nilly at night. Anything related to identity is taken. There seems to be a very precise modus operandi. They are looking either for computers or wallets with people's gas cards and so on.
Unfortunately, this has happened to me twice in the last year, and the police said basically what you said, that this is organized crime and that I will never see my stuff again. I have lost passports and similar things that were in a suitcase. One does not think of it. Of course, it is easy in hindsight: You should never leave anything in the car.
However, my question to the police and to you, sir, is with respect to what you know and what is driving this legislation. Where do these items go from there? When they are gone, either across our border to the U.S. or over to Milan — I do not know where it goes — nothing happens. I have been waiting with great trepidation. Do they wait for five years and suddenly say, "Okay, now we have had Senator Baker's or Senator Angus' stuff. They were being very vigilant in the wake of the theft, but now it is time."
What happens? Do you have a sense of that?
Mr. Nicholson: I have had a number of discussions, as you can imagine, with law enforcement agencies and people who are trying to deal with this. With your example, someone who kicks in the window of your car and steals your property —
Senator Angus: Identity items.
Mr. Nicholson: Yes, identity items. It is a crime in this country. There is no question about it. The person who steals your credit card or makes a false credit card is a criminal.
It is continuously brought to our attention that this is a larger scheme and that we are not getting everyone. It is similar to auto theft; the laws are out of date, and you will have auto theft before you at some point. People tell me the same thing: "Oh, there is a provision in the Criminal Code if you are in possession of the stolen property."
What about the guy who was over here? What about the guy who was marketing this? Many people involved are not captured, and this is what they are telling me about this. When I was in Montreal a year ago with this, a reporter asked me if this was my attempt to get ahead of the bad guys, and I replied that I just want to catch up with the bad guys. This is what we are dealing with; it is ongoing.
Senator Angus: The whole chain of it.
Mr. Nicholson: It is the whole chain.
This is why the proposed legislation is targeted to catch everyone who is in that business. This is what we have to do because these are sophisticated operations. It is not tolerable to only get the person who is actually using the credit card, or the person who actually stole it out of your wallet or out of your car. You have to catch everyone who is part of assembling this for illegal purposes. That is what this proposed law does, and this is why it will be welcomed.
As Senator Wallace indicated, all those individuals who wanted to be there at the press conference who are intimately involved with this whole question are saying that we should update the Criminal Code of this country. This is the challenge we always have with the Criminal Code. People comment that it was written in 1992. However, it was just assembled in 1992. Some of those provisions were 100 years old back then.
We must constantly be looking at these to try to ensure that the sophisticated criminal element out there today is not getting ahead of us.
Senator Angus: You talked about the Internet. We are now dealing in that world of cyberspace.
Mr. Nicholson: It is not confined anymore. It is similar to child pornography. If you go back 50 years, someone produced the child pornography and then sold it. No money is being transferred anymore. Many times, these things are no longer produced in Canada. We have to continuously be looking at the laws to ensure we are capturing the type of illicit activity that is happening out there.
Senator Angus: We are all wrestling with this issue. The car window gets kicked in, stuff happens and the police say to me: "Well, good-bye, Charlie. We have 96 of these a night on average in Montreal between University Avenue and Peel Street, for example. We will never find it. You can look in all the garbage pails yourself, but you will not see it again."
Therefore, I am asking you how this will help.
Mr. Nicholson: It gives them the tools to ensure that anyone who becomes involved in transporting your information, collecting it, shipping it overseas; anyone who is part of the criminal organization will now be covered by this particular legislation. That is exactly what we need to have in this country. We need to have auto theft and child pornography covered — right across the board.
When this type of activity comes to our attention, we have to update the Criminal Code to ensure all of this is captured. This is what this bill does.
[Translation]
Senator Nolin: Thank you, Madam Chair. We will now switch to the language of Molière since it is Canada's second official language.
Thank you, Minister, for making the trip to meet with us today.
Senator Joyal: It is one of the two official languages, not the second.
Senator Nolin: Thank you, Senator Joyal.
Minister, I would like to discuss clauses 7 and 9 of the bill, which set out exemptions for government employees, public servants, who make false documents for the federal or provincial governments.
Just under 10 years ago, Parliament enacted section 25.1 of the Criminal Code. My first question is this: Will the procedure set out in section 25.1 apply to the exemptions that you are introducing in clauses 7 and 9 of Bill S-4?
[English]
Mr. Nicholson: Senator, are you asking me if there are exceptions? There are exceptions for people who, in good faith, produce documentation, even false documents, if it is pursuant to a legitimate reason.
Senator Nolin: Minister, you are introducing two exceptions. I think those two exceptions are valid; I am not questioning the validity of them. I know the experts have criticized those amendments that were introduced to the Criminal Code in 2001, if my recollection is good. That was section 25.1. Here in the Senate, we introduced some amendments to that bill at that time to ensure the process that was introduced in the code would be respectful of the rule of law and a series of principles.
I want to know if those two exceptions that you are introducing through Bill S-4 will be included in the process introduced in section 25.1. You are repeating in the bill what is already in the code. That is why I want to know why it is you are repeating it. Do you want to exclude those exceptions from section 25.1?
Ms. Klineberg: There are sort of two ways to come at this question.
Senator Nolin: That is exactly why I am asking the question.
Ms. Klineberg: First, in the consultations we held with law enforcement, even independent of this particular piece of legislation, they were especially concerned that the making, the carrying and the using of false identity documents to maintain their covert identities in undercover operations were not easily justified by virtue of section 25.1.
Section 25.1, on their understanding of it, contains a requirement that there already be an investigation under way. In other words, section 25.1 was created to justify, in advance, violations of the criminal law by law enforcement in the course of an investigation that was already underway. Law enforcement told us that they routinely develop and create false covert identities long in advance of there being a particular investigation.
Senator Nolin: I was anticipating that answer. To be honest with you, I was afraid I would hear that answer.
When we introduced section 25.1 in 2001, we had a long discussion about the police doing something illegal. We said that we would agree to that, even though the jurisprudence and the Supreme Court had accepted the principle, but decided to enshrine it in a series of checks and balances, which is fine. The government of the day decided to amend the code. Then the Senate decided to say, "Let us go the full nine yards and really bring Parliament into the loop and ask for a report by the various authorities to tell us, not the detail of the covert operations, but how the rights of Canadians are protected by the police having those extraordinary rights."
When I read the bill and saw those two exceptions, I was afraid I would hear what I just heard. It is tough. We decided to go around the obstacle because the police were asking for that. That is exactly why section 25.1 is there. We do not want to go to the Supreme Court and say that we have a series of excuses, and it was for benefit of law enforcement. That was pleaded before the Supreme Court, and the court decided to enshrine that in a more scrupulous structure.
Ms. Klineberg: May I try the second angle?
Senator Nolin: Of course. That is why we have sober second thought.
Ms. Klineberg: One thing to bear in mind from the outset is that the offence of forgery actually contains a fairly low mens rea threshold. The mental state required for making a forged document and using a forged document is simply the intent to deceive. It does not actually require the intent to defraud. For instance, if I wanted to pretend that I have graduated from Harvard Law School and make a phoney certificate on my computer and put that on my wall, maybe with the intention of deceiving someone who walks into my office, that technically speaking might be the offence of forgery, so it is a fairly low threshold.
We understand from law enforcement they may violate that every day when they are acting in an undercover capacity because every day they are acting in an undercover capacity they might be using a credit card or a business card in the name of their covert identity. It is repetitious. It is many acts of a fairly trivial nature, so it was thought we could justify separate exemptions for this.
Some other offences in the Criminal Code also have exemptions, and child pornography is one of them. Explicit exemptions exist for the possession of child pornography for a purpose related to the administration of justice. Some offences technically are a violation of the law for some people to do, but law enforcement will be in possession of contraband when they receive it, when they confiscate it and when they forfeit it during a criminal investigation. This is just a simple way of saying that they are actually doing their jobs in relation to this small slice of offences, not offences involving bodily harm or involving defrauding anyone, but merely possession of certain types of documents. We thought it was justified in this particular case.
Senator Nolin: I hope the court will agree with that. However, my concern was exactly that because in section 25.1 there is the civilian oversight, the checks and balances and the minister's report just to ensure that someone else is looking after the person who is trying to do his job in good faith but sometimes may, well, cut corners a little bit for the benefit of law enforcement. I hope the court will support and uphold Bill S-4.
Senator Merchant: Minister, thank you for giving us your time to hear our concerns. I have a three-part question, and maybe I will ask all three parts at once.
You spoke of the international dimension of the identity theft. First, have you been engaged with other countries? Are we cooperating with some countries and sharing information with certain countries now?
Second, on a national scope, are you contemplating creating a database as we have for other organized crime in Canada?
Third, I am interested in what we can do to educate the public to understand how to protect themselves against identity theft. We have had one example about people breaking into cars, so we know we should not leave anything in our cars. We frequently see things about how to protect yourself when you go to withdraw money from the bank. Are there things that we should be doing to educate people to try to protect themselves?
Mr. Nicholson: Thank you for those questions, senator.
We share our concerns with other countries, and we have greater cooperation than we have ever had in the past. I give the example of the question of pedophiles. You will notice now that when they are looking for these individuals, these pictures go around the world. This is fairly recent. It is a new innovation to try to track down these individuals so that they have no place to hide. Yes, there is greater cooperation around police forces. Again, it is not specifically related to the justice portfolio, but Interpol and other organizations cooperate with each other to try to track these people down. In terrorism, for instance, we know of the cooperation between our country and Great Britain and the United States and other countries in terms of trying to track down these individuals because we are all exposed to the damage these individuals can cause.
I do not have any specific plans on a database with respect to this legislation, but I thank you for your comments on that.
We are making these announcements and bringing in people from the private sector as part of this education process. Certainly in my conversations with stakeholders, I say the same thing to them that they have to get this message out to their customers and to people. I do think there is a greater awareness today. People understand the pitfalls and the challenges of protecting their own information. Between government, private sector and individuals, the message is getting out there that this is a continuous problem, and it could get worse, which is one of the reasons we are bringing this legislation forward.
Senator Merchant: Specifically, how will you educate people to protect themselves? I am talking about government, not about people talking to their customers.
Mr. Nicholson: I am not announcing any new program. We have announced programs on a national anti-drug strategy. We keep announcing programs. We work with NGOs and community groups. I am not announcing any specific program to launch identity theft awareness. However, again, in my discussions with stakeholders, I tell them that they have a great deal at stake here in ensuring that the message gets out. I have been pleased with their response.
Senator Bryden: Thank you, Minister, for coming.
I will be brief and also get off topic a little and talk about some of the drafting that is in here, or the terminology. The first one that hit me is in proposed new section 56.1(1). I think I understand it, but I am not sure.
Every person commits an offence who, without lawful excuse, procures to be made, possesses, transfers, sells or offers for sale an identity document that relates or purports to relate, in whole or in part, to another person.
Why is the phrase "procures to be made" there? It is a strange combination of words.
Mr. Nicholson: I will ask the drafter the question.
Ms. Klineberg: In that context, we were thinking that if an individual were to use false information to make an application — for example, a passport or driver's licence — it would be the act of trying to get the document issued, in and of itself, in a false name. That is what we were trying to capture by "procuring" to be made.
Senator Milne: Therefore, it should be "causes" to be made, not "procures" to be made.
Ms. Klineberg: I could not tell you how many times we go around in circles in drafting this. I could not say that we have necessarily got all the words in the only form in which they could have been drafted. However, that is what was intended with that wording.
Senator Bryden: Senator Milne, I think the word "causes" is well understood by most people.
Mr. Nicholson: We will look at that and get back to you.
Senator Bryden: Having done some drafting myself, there is a tendency for some drafters to want to write poetry so as not to repeat the same word over and over. However, you are trying for clarity not poetry in preparing a piece of legislation.
Clause 5 of the bill amends subsection 342.01(1) of the act, which states that:
(1) Every person is guilty of an indictable offence and liable to imprisonment for a term of not more than 10 years, or is guilty of an offence punishable on summary conviction, who, without lawful justification or excuse, makes, repairs, buys, sells . . . .
I understand that and it appears in the bill a couple of times. However, I have a Senator Baker piece here that I could not pass by. Clause 4 of the bill says:
Every person who, fraudulently and without colour of right, possesses, uses, traffics in or permits another person to use . . . .
Why would you choose to use the terminology, which some might say was archaic, of "colour of right" in this?
Mr. Nicholson: I did not know it was that archaic, senator. I thought that term was rather common.
Ms. Klineberg: Clause 4 pertaining to amendments of subsection 342(3) of the Criminal Code is an offence currently in the Criminal Code. It has that phrase in it. You might see different language in that offence than you would in the offence from clause 5 pertaining to subsection 342.01(1). Clause 5 in the bill deals with the making, possession, import and export of instruments — actual things — whereas clause 4 pertaining to subsection 342(3) deals with misconduct in relation to another person's credit card information. There is an element of fraud, deception and dishonesty involved in the use of another person's information that is not present in relation to the offence for making or repairing instruments for use in crime. That is why you would see something like "fraudulently" used in the one offence and not the other.
Again, these are offences currently in the Criminal Code. It is another of those difficult decisions we face: Should we take the opportunity when amending the legislation for one purpose to make it consistent with other offences in other ways? Oftentimes, we decide not to do that because it creates difficulties for police and prosecutors who would have to prosecute offences worded slightly different. We sometimes decide simply to maintain the wording where there does not appear to be a problem with interpretation or application of the offences.
The Chair: While on the subject of prose, I understand how it came to be, but I draw your attention to proposed new section 56.1(3):
For the purposes of this section, "identity document" means a Social Insurance Number card, a driver's licence, a health insurance card, a birth certificate, a passport as defined in subsection 57(5), a document that simplifies the process of entry into Canada, a certificate of citizenship, a document indicating immigration status in Canada or a certificate of Indian status, issued or purported to be issued by a department or agency of the federal government or of a provincial government, or any similar document issued or purported to be issued by a foreign government.
I read that three times before I was sort of satisfied that all of the documents it refers to had to be issued or were purported to be issued by a department or agency of a government. I wonder if it might not be possible to reword it slightly to make it clearer from the outset. I know that the entire section is headed "Official Documents." However, that particular paragraph strikes me as virtually indigestible and unusually the French was not much help. Often the French is clearer than the English, but I did not find it to be so in this case.
Mr. Nicholson: Do you suggest we come up with a better definition of government documents?
The Chair: No, simply make it clearer that every single document listed, and not only the last one in that list, is to be a document issued by a government. You have a series of commas and after one of the commas you have "issued or purported to be issued by a department or agency of the federal government." As I say, I found it quite indigestible. Maybe every lawyer in the land finds it crystal clear. I did not.
Senator Nolin: No, it is worse.
Mr. Nicholson: I thought lawyers liked definitions like that.
The Chair: They are very lucrative.
I have been informed that minister has a vote in 10 minutes. Minister, we did have more questions. Could I ask Senator Baker and Senator Joyal to pose their questions? Maybe you could write back to us or perhaps Ms. Klineberg could remain and answer them if they are within her purview. I am sorry, honourable senators; I did not know this was the case.
Senator Baker: My question relates to Senator Joyal's line of questioning. As you indicated, the civil remedy is brought into the Criminal Code for compensation purposes that result from the commission of a crime. Am I to understand that this will be a procedure similar to that of forfeiture under the Criminal Code? In other words, it will be a procedure after sentencing, after someone is found guilty. Then there will be a judgment by the court as recommended by the Crown as to the extent of the damage. In other words, will it mirror a forfeiture judgment after sentencing?
Senator Joyal: When Bill C-27 was introduced, the Privacy Commissioner raised the issue that the bill as drafted at that time did not cover the spam or phishing initiative, a common crime to induce people to believe that you are a person in authority to phish information. We know there are many "victims" of that initiative. Is it correct that that preoccupation expressed by the Privacy Commissioner is not covered by Bill S-4 as drafted now?
Mr. Nicholson: I will leave Ms. Klineberg with you. I will confer with her on the answers to that, and we will get back to you on any other information you may need.
The Chair: We thank you, and I apologize. Votes matter, and I did not realize you had one coming.
Do you have answers to those questions, Ms. Klineberg, before we continue?
Ms. Klineberg: With respect to the second question, Senator Joyal's question, I was just informed as the minister's staff was leaving that the Minister of Industry has just tabled a spam bill.
Senator Joyal: Will it be covered individually?
Ms. Klineberg: Unfortunately, I am not in a position to say much more on it.
Senator Angus: Yes, I think that was intention.
Ms. Klineberg: I think it is a comprehensive legislation.
The Chair: I am informed that that is Bill C-27. We can inform ourselves about it as we proceed.
Ms. Klineberg: With respect to phishing, to the extent that a phishing attack is designed to elicit from people their own personal information, it could constitute an attempted identity theft, so it is not explicitly dealt with in the bill. However, phishing is a method of committing identity theft; it is one of the many methods of doing that. A phishing attack, if that is its purpose, could be an offence of attempted identity theft. If it is successful and people do respond by providing their information, that would be an identity theft.
Senator Joyal: Should we not spell out the attempt clearly in the bill?
Ms. Klineberg: I think section 24 in the Criminal Code is the general provision for attempt. Attempting to commit any offence constitutes an attempt, so for most offences, we do not spell out that attempting to do something would constitute an offence. We usually just leave it for the general application of section 24 in the Criminal Code.
Senator Joyal: On clause 11 of the bill, again, on the wording of the examples that are given as expenses that someone might incur to re-establish their identity, I read "including expenses to replace their identity documents." That is easily understandable. If you want to replace your passport, that is easy, or if you want to have another birth certificate or another social insurance number or health insurance card and so on.
More problematic, and I am looking at Senator Angus on this, is the part that says, "and to correct their credit history." What are the expenses to correct the credit history?
This concept is very broad because we can imagine any type of situation. If I have to re-establish my credit history with a bank, a financial institution, a credit card company or any institution that deals with credit, it might mean a lot because the institution might ask for me to pay back expenses that they had to incur to face the responsibility and so forth. This is a very broad concept.
What do we have to understand by re-establishing credit history? What do you include in that?
Ms. Klineberg: With Equifax, for example, I think you can obtain one free copy of your credit rating per year, so if you were to try to obtain many of them to verify that changes you had made were being incorporated into their documents, there would be costs associated with ordering those.
The examples you mentioned might also apply. It was, as you say, meant to be somewhat broad. We did not want to be listing specifically all of the potential things for which people might seek restitution. As you say, we went for the concept instead, so that people or the Crown on behalf of the victim could make arguments that certain costs should be covered.
I can not give you much more in the way of detail to what that could cover, but the idea was direct costs related to the victimization of a person having their identity stolen.
It would be for the Crown to argue exactly how that might play out in any particular case.
Senator Joyal: That is subject to the last sentence, the last words, "if the amount is readily ascertainable.
Ms. Klineberg: Exactly; that always has to be part of an order for restitution because the criminal court is not in a position to engage in the same sort of analysis that a civil court would do to determine remedies. The criminal court needs to have put before it on the part of the prosecutor readily ascertainable and relatively clear costs associated with the crime. It will always be subject to that particular qualification, but the nature of the claims might be subject to some broader interpretation.
Senator Baker: My question relates to my earlier question, which was not addressed. The reason I ask the question is precisely the line of questioning that Senator Joyal was following.
Under the present sections of the Criminal Code, when you have forfeiture involved, under various sections, it is readily available because the forfeiture provisions have a value already done, or it is the forfeiture of money to the Crown, a forfeiture of the value of the offence that was committed. It is readily available, so that if someone pleads guilty to an offence and the trial does not go on for a year, two years, three years or four years, as some do, the Crown is able to immediately identify an amount of money.
However, in this case, as Senator Joyal has pointed out, it could have ramifications down the road. That is why in civil actions you usually wait for two to five years to find out the results of the offence for which you are trying to collect compensation.
In this case, it has to be immediate, with some formula in advance. Do you anticipate, have you had any representations or have you turned your mind to the sort of a formula that would be suggested to the Crowns to address that very serious problem? It could be something happening two years in the future.
You could say that we will turn to the civil courts, but you have it now here in legislation. Have you turned your mind to a formula?
Ms. Klineberg: Nothing that I would quite call a formula. I would anticipate that Crown prosecutors would undertake the same sort of analysis they would for other claims that they try to make for restitution under subsections 738(1)(a), (b) and (c) of the Criminal Code. There might be physical injuries, the remedy for which is still ongoing after the time of trial, which would not be covered by a restitution order. It is not meant to replace a civil proceeding. Restitution is designed as part of the sentence to instill a sense of responsibility on the part of the offender. It is not meant to be a road to complete recovery and remedy for the victim.
Senator Baker: If that very question were adjudicated in the criminal court, you are surely not suggesting that someone could then ask for a reajudication of the same question in the civil action following?
Ms. Klineberg: No, it is a different route to a remedy for compensation. There is overlap as well in terms of subsections 738(1)(a), (b) and (c). Those losses as well could be claimed in a civil suit. Alternative methods are available for the victim to obtain some form of restitution.
There is an advantage from a criminal-justice perspective to this being part of the sentence because it, as part of the criminal law, as opposed to a civil law, creates a sense of responsibility and a duty to repair the crime on the part of the offender, which is a slightly different way of approaching the situation civilly. It is an alternative route to the same sorts of things, but it is much more limited, and, therefore, the amounts have to be readily ascertainable much more quickly. It is also easier for the victim who would not have to go through the process of suing if the restitution they could get criminally were sufficient for them.
Senator Joyal: Once you are found guilty, compensation as provided in clause 11 is almost automatic.
If you go to civil litigation, it is a totally different type of action, and you might not get as much as you get on this one, especially in terms of re-establishing. Look at what it means: credit history and credit rating. In some circumstances, it could be quite something, especially if you think about those organized groups that are "well oiled" in trying to extort money through all sorts of devices.
It is a very important concept we are introducing in there. Senator Nolin knows the issue of claims or damages in civil litigation. It is a whole set of different kind of approaches in the Criminal Code that we have in there. Those are intangible damages, while section 738(1) is property. Property is hard, whereas a credit rating or history is intangible.
Senator Angus: No, she was talking about direct costs involved in re-establishing the intangible. It is different.
Senator Joyal: It is much different. That is why I draw the attention of the minister, you and honourable senators to this. I am not opposed to it in principle, but how do we evaluate it? How do we frame it? What are its side consequences?
In my opinion, those are very important issues. We might want to hear about this from other witnesses because I feel it is an important element of this bill.
Senator Angus: If I understand it, this is an additional penalty. You have fairly strong penalties of imprisonment and so on. This restitution is an additional sanction of some kind and, therefore, I imagine, designed to be a deterrent. That is what these penalties are all about; to make them such that the criminals are deterred and encouraged not to commit the crime.
I think you are saying that it is not that clear and these direct costs are probably de minimis in most cases. If Equifax charges $50, the costs involved really with Equifax and the credit agencies — in the experience we have seen at the Banking Committee — are much worse than that. You have to hire lawyers. It takes seven years of no unpaid bills to wipe your slate clean.
I do not think the Criminal Code should be getting involved in that area. I do not know if that is your point, but clearly we are into an area that is worthy of further examination.
Senator Joyal: I have a question about the concept of reasonable inference on page 7 of Bill S-4, the proposed new section 402.2. Could you give us an indication where other sections of the code would help us to understand what "reasonable inference" means?
Ms. Klineberg: The best example for an offence that is framed in that same way is section 351 of the Criminal Code, which is the offence for possession of housebreaking instruments.
Senator Baker: Breaking and entering to commit a crime is an indictable offence. Of course, that is in the tools.
Ms. Klineberg: I believe there may be one or two more, but we usually turn to section 351 as the prime example because this particular offence has been interpreted by the Supreme Court of Canada in the case of Holmes back in 1988, I believe. The Supreme Court interpreted that phrase in circumstances giving rise to a reasonable inference that the person or that the instrument had been used or was intended to be used. The Supreme Court said, in the criminal law —
Senator Joyal: To which case are you referring?
Ms. Klineberg: The Holmes case.
The Supreme Court interpreted that phrase as actually requiring the normal criminal standard of proof beyond a reasonable doubt that the accused person actually intended to use the instruments. Even though it is phrased as "circumstances giving rise to a reasonable inference," the courts said that any reasonable inference still, in the criminal law, has to be proof beyond a reasonable doubt that the person actually had the intention.
Senator Joyal: Therefore, you still have to prove the intention?
Ms. Klineberg: Yes. However, we sometimes see much interest on the part of police or prosecutors in this type of formulation for offences because, while any criminal offence can be proved on the basis of inferences, proof beyond a reasonable doubt of a person's intention can still be made out by circumstantial evidence and inferences drawn from circumstantial evidence. Sometimes, law enforcement and prosecutors like this formulation of an offence because it builds the notion of the inference right into the offence in the way it is drafted.
Nonetheless, it is interpreted as if it had been written that the person intended to use the instrument or the information. It is a different way of saying the same thing.
Senator Joyal: Yes, however the word "circumstances" would be probably the proof to be made to the court to draw the intention or to support the intention.
Ms. Klineberg: Right, but that is the case no matter how you draft an offence. An offence will always be proved on the basis of inferences that we draw from circumstances. Unless you actually have a wiretap, for instance, and a person who says, "This is what I intend to use this information for," you will be asking the court to be concluding proof on the basis of inferences that they draw from the circumstances, in most cases.
Senator Joyal: Finally, on the issue of the definitions that were raised at the beginning on proposed new section 56.1(3): "For the purposes of this section, "identity document" means a Social Insurance Number card. . . ." and so forth.
I receive my income tax file from the government, which has my insurance number and personal information, and I file it. The bank might ask for my income tax declaration, for instance, to get credit, a loan or a mortgage or whatever I want to deal with, financially. Since it is a government document, why is it not covered in 56.1(3)?
As Senator Fraser has mentioned, "identity document" is defined as being issued or purported to be issued by a government department. The document I receive from the income tax department is issued by a government department, and it has very private information that could give anyone the opportunity to steal any identity.
Why is such a document excluded from this definition? Is it because it is limitative in terms of the enumeration you give in the definition?
Ms. Klineberg: Yes. As the minister indicated earlier, this offence has a very low threshold for conviction because it does not require proof that there was any intention on the person's part to use the document in any sort of fraudulent way. Mere possession or transfer of these documents is sufficient to make out the offence, unless, of course, the person has a lawful excuse or fits into one of the enumerated grounds. It has a very low threshold for proof of this offence.
Due to the low threshold, it was our view — and for Charter reasons, in particular — that the class of documents had to be very limited. It is similar to a trade-off: The lower we want to go in terms of the fault element for the offence, the clearer, narrower and more circumscribed we really have to be in terms of what constitutes an offence.
In this particular offence, we were trying to get at documents that are used by individuals for identification purposes — not documents that contain information, not their financial statements, not a number of other documents you might receive from the government that contain a number of pieces of information of a private or confidential nature, but the foundational identity documents that govern individuals' relationships with the government and the private sector. These are the documents that form the basis of what identity is. In the interests of ensuring the maximum likelihood of this offence being found to be constitutional, we tried very hard to limit the types of documents to those core identity documents that regulate all of our interactions with the private sector and the public sector.
Senator Joyal: What about a death certificate? You have a birth certificate listed here, but a death certificate could be as useful for someone trying to re-establish the identity of someone as a birth certificate. In fact, sometimes it could be even more useful, for obvious reasons, because no one will claim that their identity was stolen.
Senator Angus: You are familiar with the electoral lists.
Senator Joyal: I am an old pro, like you.
A death certificate is a government document. There is no doubt about that. It is a provincial government. It is as useful and as needed by those who want to re-establish the identity of other people or claim the identity of other people as any other document. Why was the death certificate not included?
Ms. Klineberg: The honest answer is that it did not occur to us. We developed this list in consultation with a number of other government departments. We held consultations with a range of government departments that issue these sorts of documents. Together, we tried to determine the core documents that we should be including on this list. I can only imagine that death certificates did not occur to us. As you say, it is a provincial document. Everyone has their own birth certificate. None of us, as yet, have our own death certificate. I do not think it occurred to us. It seems to me as though it might be a valid addition to the list.
Senator Nolin: This type of crime is not limited to one province. It is international. It involves many jurisdictions. The cost of a law enforcement organization going through this type of investigation could be a deterrent to the implementation of Bill S-4. The minister would probably have been the right person to answer this. As we all know, the provinces will have to operate the system. What will we do to help them? Do you have in mind some type of information sharing to help them do the job?
Ms. Klineberg: As far as I know, nothing of the nature of an information-sharing database is being contemplated at this time. In terms of additional funding for law enforcement, that is something I would not want to speak to; I am sorry.
The Chair: We can write to the minister, or you could just convey to the minister that question, which might be a little faster. It would be something we would be interested in learning.
Senator Nolin: There is no point in making laws if we are just creating a bigger monster for those who have to enforce them.
The Chair: As we were reminded earlier today in another context, the RCMP is the police force in many provinces. That is not even provincial. That is direct federal responsibility.
Senator Nolin: I thought the minister would have been the right person to answer that. That is why I stopped there.
Senator Milne: I have a supplementary to what Senator Nolin has just asked, but also a further question, if I may.
Will this bill in any way force companies to notify customers when their identity has been stolen? Is there anything in the bill that will force companies to let people know?
Ms. Klineberg: No. We would not use the Criminal Code for that sort of mechanism.
Senator Milne: This is where the data bank would come in handy.
Ms. Klineberg: I know that matter has been debated in consideration of amendments to the Personal Information Protection and Electronic Documents Act, PIPEDA. Unfortunately, I am not up to date on the status of their decision making on that particular issue. If you like, I would be happy to convey that to my colleagues at Industry Canada.
The Chair: I would like that because I want to know the justification for saying that this is not something we would do in the criminal law. In a sense, this goes back to our discussion about reckless earlier.
Senator Milne: It goes back to enforcement.
The Chair: When people know that serious personal information has been stolen, why should it not be a criminal offence to fail to notify the person to whom the information refers, since so much else is being made criminal, and I think rightly so, from all we have heard.
Senator Milne: There is an example in case law about identity theft. This is the case of R. v. Boyle, 2005. It was, I believe, out in British Columbia. Mr. Boyle was convicted of fraudulently impersonating a man who was dead with intent to gain an advantage for himself. This is contrary to section 403(a) of the Criminal Code. He appealed his conviction. It was not successful. In this case, the trial judge ruled it was only required to find that the appellant had the intent to gain an advantage by impersonating someone else. That is already in the Criminal Code. In your opinion, how would this bill change that?
Ms. Klineberg: That, as you have correctly noted, is the offence of personation, which is what we could call the end stage of the identity-theft spectrum. It has been in the Criminal Code, I think, since 1892, but I would have to verify that for you. Various forms of fraud, as well, cover the end stage where people pretend to be someone else, for instance, to take out a fraudulent mortgage on someone else's piece of property. The end stage of identity crime is already covered by the Criminal Code.
One of the amendments that we have not talked about yet is that the offence of personation in Bill S-4 will actually be renamed "identity fraud." The new offences that are being created in Bill S-4 apply at the early stage of the identity-theft spectrum. They are offences that target the gathering of information with intention to use it later, the trafficking in the information, being reckless knowing that someone else would use it later. The new offences cover the earlier stages of the identity crime. The offences we already have in the Criminal Code cover those quite nicely. We will rename personation "identity fraud" and create some identity-theft offences, and the hope is that this will create a more coherent understanding of the full range of identity-theft activities or identity-crime activities, you could say.
A great deal of inconsistency in the use of terminology exists in this area, which is also one of the reasons we have renamed personation to "identity fraud." If each one of us were to give our definitions of identity theft, we all might define it slightly differently. Some people use the term identity theft to encompass personation when they are actually just different phases of the same activity.
Bill S-4 fills the gaps, as the minister said. The gaps are at the early stages: the collection of the information, the manipulation of the information and the trafficking of information. We have heard numerous times from law enforcement that they will uncover an operation where they have a warehouse full of documents, identity profiles and forged documents, but they cannot prove that any of them had been used yet. Had some of those documents been used, you might be at the stage of personation or fraud, but in advance of them being used, currently there is not all that much that the law can do. Bill S-4 fills that gap.
Senator Joyal: I apologize to my colleagues.
What about the biometric documents that the government would develop to cross borders? We know those sorts of documents will be used and developed more in the future because the technology is proceeding.
Why do you not have a definition included that would cover that possible development? The development is underway. If we are to address that problem in the future, why do we not cover that here?
Ms. Klineberg: The short answer is that we did try to take into account the NEXUS pass and the CANPASS Air in the definition in proposed new section 56.1(3). We included a passport, but also "a document that simplifies the process of entry into Canada." We were aware of the NEXUS card, and we tried to cover it.
With respect to future documents created, the information contained in those documents would fall within the definition of "identity information" in proposed new section 402.1. That information would be covered and included in the offences of "identity theft" and "trafficking in identity information."
You are correct to point out that new documents would not be included in the document offence unless a coordinating amendment was made to the Criminal Code at the same time as passage of that legislation. We had been advised to give this offence the greatest chance of surviving a constitutional challenge; we had to be very circumscribed in the scope of documents included. To leave room for new documents that may be created one day would introduce a degree of vagueness that we were concerned might make the offence more vulnerable.
Proposed new section 56.1 is the only offence where we have received criticism from legal associations on that very point that it does not contain much on mental state. It is really only possession of these documents. They are not contraband documents. We all have them. At any given time, I might have my mother's passport, et cetera.
A risk exists with this particular offence. You may hear that if you have legal associations testify before you. We have closed off that list solely for the purpose of giving it the greatest chance of surviving.
Senator Joyal: I understand that the bill, as drafted, does not cover the case whereby someone fabricates an identity with elements taken from various sources, which is creating a new person not.
Senator Baker: That is interesting.
Ms. Klineberg: The offence of personation, which is an existing offence in the Criminal Code, is limited to a person living or dead.
We were very aware of this concern during the creation of the new offences — identity theft, trafficking in identity information and the document offence. When people read the bill, I do not think they tweak to what we have done to address this issue. You will notice the phrase "an identity document that relates or purports to relate, in whole or in part, to another person."
When you go to proposed new section 402.1, it says the definition of "identity information means any information . . . of a type that is commonly used alone or in combination with other information to identify or purport to identify an individual."
We have specifically used those words to signify that even if the person is not a real person, but the information is presented as though it were relating to a real person, it should be covered.
Some people who read this legislation, if they are not familiar with reading criminal legislation, might not pick up that that is what those words are meant to do. However, we clearly intend to cover wholly fictitious identities as well as composites where some fictitious information is combined with information belonging to a real person.
The Chair: I should point out that Senator Joyal is "deeply" familiar with reading criminal legislation.
Ms. Klineberg: That is true.
Senator Baker: She did not mean him.
Senator Nolin: You raised my concern when talking about carrying the passport of your mother. Some Canadians are listening to us and — I am sure — are very nervous in hearing your answer. I assume you would be protected when Bill S-4 uses the language "without a lawful excuse." Is that what you mean by a lawful excuse?
Ms. Klineberg: We have done even better. If you look at proposed new section 56.1(2)(c), it says, "with the consent of the person to whom the identity document relates."
Senator Nolin: That means you need to prove the consent of someone. If you have your mother's passport in your purse, and she cannot give her consent, but needs a passport to go through immigration, do you have a lawful excuse?
Ms. Klineberg: Yes.
Senator Nolin: Okay, good.
Ms. Klineberg: The lawful excuse is the backup if those explicitly listed exclusions do not apply.
The Chair: Under that same proposed subsection, I assume you would be the "person authorized to consent," if you are ushering your mother through customs.
Senator Wallace: Ms. Klineberg, you have mentioned that there are new offences in the bill dealing with the use of credit cards and credit card data. There is no mention of debit cards or ATM cards though, which are obviously somewhat similar. Is there a particular reason why they were not included?
Ms. Klineberg: This is another of these unfortunate situations where we put a definition in one part of the code that is slightly removed from the offences. Section 321 of the Criminal Code has a definition of credit card that includes debit cards.
Senator Wallace: Okay.
Ms. Klineberg: It says:
"Credit card" means any card . . . distributed for the purpose of being used . . .
(b) in an automated teller machine, a remote service unit or a similar automated banking device to obtain any of the services offered through the machine, unit or device; . . . .
We have the definition in section 321 of the Criminal Code rather than having to use both "credit card" and "debit card" each time it appears in an offence. It is simply a drafting convention, but unfortunately I have noticed that again it seems to be confusing.
Senator Joyal: That definition certainly makes it clearer.
Ms. Klineberg: Yes. Without any doubt whatsoever, law enforcement, Crown prosecutors and the courts are well aware that debit cards are covered by the law even though if you were simply to read the offences, you might not think that is the case.
The Chair: Why then do you refer to "credit card number" and "debit card number" in proposed section 402.1?
Ms. Klineberg: This is what happens to a Criminal Code after more than 100 years. It is quite unfortunate in some ways.
The definition in section 321 applies only in Part 9 of the Criminal Code.
The Chair: Okay.
Ms. Klineberg: We would have had to say as well that credit cards include —
The Chair: No, that is fine. It is not good, but it is a comprehensible answer.
Senator Wallace: It is picked up in the definition. That is a clean answer. Thank you.
The Chair: It was an extremely interesting session. Thank you, Ms. Klineberg. It is not often that one person is willing to sit and take many technical questions. I congratulate you. You did very well indeed.
Honourable senators, we shall meet again in this room at 10:45 a.m. tomorrow morning to continue our study of this bill.
(The committee adjourned.)