THE STANDING SENATE COMMITTEE ON FISHERIES AND OCEANS
EVIDENCE
OTTAWA, Tuesday, May 26, 2026
The Standing Senate Committee on Fisheries and Oceans met with videoconference this day at 6:31 p.m. [ET] to examine and report on the commercial fisheries licensing regime on Canada’s Pacific Coast.
Senator Fabian Manning (Chair) in the chair.
[English]
The Chair: My name is Fabian Manning. I am a senator from Newfoundland and Labrador, and I have the pleasure of chairing this committee.
Today, we are conducting a meeting of the Standing Senate Committee on Fisheries and Oceans.
Should any technical challenges arise, particularly in relation to interpretation, please advise me or the clerk and we will work to resolve your issue.
Before we begin, I would like to take a few moments to allow the members of the committee to introduce themselves.
Senator Dhillon: Baltej Dhillon, from British Columbia.
Thank you, Mr. German, for joining us from Australia.
Senator Osler: I am Senator Flordeliz (Gigi) Osler, from Manitoba.
Senator Ravalia: Good evening and welcome. I am Senator Mohamed Ravalia from Newfoundland and Labrador.
Senator Poirier: Hi and welcome. I am Rose-May Poirier, and I am a senator from New Brunswick.
Senator Prosper: Paul Prosper, Nova Scotia, Mi’kma’ki territory.
Senator Surette: Allister Surette, Nova Scotia.
Senator Busson: Welcome, Peter. I am Bev Busson from British Columbia.
The Chair: Thank you, senators.
On November 18, 2025, the Standing Senate Committee on Fisheries and Oceans was authorized to examine and report on the commercial fisheries licensing regime on Canada’s Pacific Coast.
Today, under this mandate, the committee will be hearing from the following individual: Peter German, Chair of the Advisory Committee of the Vancouver Anti-Corruption Institute, as well as President and Director of the International Centre for Criminal Law Reform, coming to us via video conference from Australia, I understand. We certainly thank you for taking the time to join us here this evening, and we look forward to your remarks.
Following your remarks, I’m sure some of our senators will have questions for you. Mr. German, the floor is yours. Thanks again.
Peter German, Chair of the Advisory Committee, Vancouver Anti-Corruption Institute: Thank you, Mr. Chair and senators. I had the pleasure of spending some very good years in Newfoundland and Nova Scotia, so it is nice to see committee members from there.
Of course, I know the committee members from British Columbia. Greetings to Senator Busson, with whom I have worked closely in the past.
My remarks will take about five minutes, and I will proceed right now.
Good evening and thank you for the invitation. Thank you also for working late in the day on this important issue. I apologize for not being there in person; that certainly would have been my preference.
The Vancouver Anti-Corruption Institute is an integral part of, as you indicated, the International Centre for Criminal Law Reform. It’s a non-profit located at the University of British Columbia. We are a treaty-based institute between Canada and the UN Office on Drugs and Crime, or UNODC.
I am a former deputy commissioner of the RCMP. In my early policing career, I worked alongside fishery enforcement officers and was also, at one time, a federal prosecutor dealing with Fisheries Act violations. My current expertise is with respect to money laundering and corruption.
You are the experts on Canada’s fisheries, having sat through many hours of testimony on diverse subjects in this important sector. I am not.
What I hope to bring to this meeting is an awareness of certain unsettling aspects of the industry at home and internationally. These issues pose a serious threat, not only to conservation and resource sustainability but also to public safety and economic integrity.
Over the past decade, enforcement of Canada’s fishery laws has struggled to keep pace with increasingly complex pressures. Fishery officers and conservation and protection staff have consistently reported under-resourcing, high-risk conditions and growing volumes of illegal activity.
Several reviews and labour investigations have described officers facing armed individuals, intimidation, dangerous nighttime operations and significant safety gaps.
The UN Office on Drugs and Crime categorizes crimes within the fisheries sector into two categories. The first are those that do not have a direct connection to fishing, including the use of fishing vessels and export channels to move illegal goods such as drugs and firearms.
The second category encompasses crimes in the fishery value chain, such as illegal fishing, corruption, money laundering and tax evasion.
The UNODC is currently engaged in a project, dubbed FishNET II, which has three objectives: strengthen the legal and policy frameworks associated to the fisheries sector; enhance criminal justice and law enforcement capacity, and strengthen the capacity to address corruption.
Canada is not immune. A galling example of Canada’s vulnerability comes from our West Coast. The illegal harvesting of crabs and their sale to processors is a cash business in which profits are great. Although there has been enforcement, the fines are simply insufficient to curb illegal activity in that industry. Fines become the cost of doing business.
The involvement of organized crime shifts fishery issues from being regulatory challenges to public safety and national security issues. Organized crime is not a distant or hypothetical concern. Licences and quotas are financial assets that can store or integrate criminal funds. These are valuable, transferable assets.
Opaque ownership structures make the system vulnerable. The adoption of a beneficial ownership registry in fisheries and the federal government’s recent commitment to a beneficial ownership registry for corporations are steps in the right direction. We cannot simply allow our fishery to be sold to unknown people using unsourced funds.
Recent investigative reporting and intelligence from FINTRAC, our financial intelligence centre, also point to suspicious activity within the fishing sector, including underground banking networks and unusual patterns in licence-related financial activity. Unfortunately, fish quotas and boat sales are not reportable to FINTRAC. This is regrettable, as it eliminates an important source of intelligence.
Canada must strengthen: enforcement capacity, including to deal with organized crime and money laundering; inter-agency cooperation and coordination with the RCMP, CBSA and FINTRAC; beneficial ownership transparency for licences and quotas; data systems and a public registry in fisheries to enable accountability; and proactive enforcement.
The proposed Canada financial crimes agency, announced in conjunction with the recent budget, is a recognition of the fact that fraud and money laundering are critical issues in Canada.
I caution, however, that the creation of a start-up, quasi-law enforcement agency could have the unfortunate byproduct of existing law enforcement agencies shifting their priorities away from these issues and onto an agency that could take a decade before it can be expected to make a difference.
In conclusion, Canada’s fisheries are central to our environment, economy and coastal cultures, but weak enforcement capacity, organized crime activity and real money-laundering risks threaten the integrity of the system.
Strengthening enforcement is not just about protecting fish. It’s about protecting communities, ensuring fairness and safeguarding the long-term sustainability of one of Canada’s most important natural resources.
I thank you, Mr. Chair.
The Chair: Thank you, Mr. German.
Our first questions will go to the vice-chair of our committee and former commissioner of the RCMP, Senator Busson.
Senator Busson: Thank you, Mr. German, for being here.
To ensure that we have clarity on this, Peter and I went to law school together and worked together in federal policing in the RCMP when I was the commanding officer. It is great to take advantage of your expertise here today. I’m really excited to have you here to answer some of our questions.
It is interesting that you talk about the West Coast. We have learned from a number of witnesses that on the West Coast, the number of licences and to whom the licences go on this registry are almost a secret; they are not obvious. You used the word “opaque” when you talked about the fishing licence registry.
We have had some officials from DFO describe this as privacy concerns with respect to making these licences known, out in the open and totally transparent. Could comment on that and whether the fact that these licences are not transparent has any effect on the questions around the criminality of the West Coast fishery?
Mr. German: Thank you, senator. It is, obviously, a great pleasure to be working for you once again, though in a different context here.
When it comes to corruption, it does not matter what sector of the economy we’re talking about. As they say, the best antidote to corruption is sunlight and transparency. If you do not have transparency, it goes back to the old adage, “We don’t know what we don’t know.” Certainly, transparency, knowing who beneficial owners are allows us to make decisions and come to conclusions that we can’t today.
We know that there has been a major consolidation of the fishing industry on the West Coast. We know that a large portion of the industry is held by very few people. We don’t necessarily know who those people are. Sometimes it could be numbered companies. Who owns the numbered companies? These are the types of issues that should be out in the open.
I certainly appreciate that we all respect privacy, but privacy has its limits. We have to be aware of, obviously, the public good and the greater good of disclosure in critical areas such as this. So, yes, transparency, yes, shine sunlight on what is going on, and we will be much further ahead.
Senator Busson: Thank you very much.
Senator Ravalia: Thank you very much for your opening remarks.
In May 2023, you presented testimony to the House of Commons. One of the key areas you focused on was the requirement of strong legislation and cross-agency cooperation with clear and consistent enforcement. Three years on, do you think we are meeting some of those targets? Where do we stand with respect to that?
Mr. German: Thank you very much, senator. There is a difference between the East Coast and the West Coast, which I also tried to highlight previously. I should mention how I became involved in fisheries, money laundering and corruption. Frankly, it was preparing two reports for the Attorney General of British Columbia in 2018 and 2019: the “Dirty Money” reports, which are freely available on the internet.
Some of the issues that the Attorney General asked that I look at were issues raised by Ecotrust — and I’m sure you are familiar with their great work — about the very issue that we are talking about here today. So we started looking at it, but we didn’t have much time because we were looking at many other aspects of the British Columbia economy, dirty money in the casinos and so forth.
To answer your question specifically, I couldn’t say one way or the other. I do know that recently, a new enforcement head was appointed in Fisheries Canada. I know there is a great desire to do a good job there, but are we seeing actual results? I’m not certain that we are at this point and certainly not on the West Coast.
Senator Ravalia: Internationally, are you aware of any other countries that may have faced similar issues? If so, are there lessons for us to learn from those jurisdictions?
Mr. German: I would answer in a couple of ways. First, the UNODC initiative is being led by Norway, and, typical of the Scandinavian countries, they seem to be in front of issues like this that involve the environment. There is a lot to be learned from Norway.
In terms of other countries, it is a huge issue in developing countries and the Global South. Fisheries are at risk in many countries. The concern for us is not only as world citizens in Canada, but the fact that we may well be consuming fish products that have been caught in countries where the situation is less than desirable. There are examples that you can find on the internet. It goes back to this issue of a clean supply chain. We have no clean supply chain legislation in this country, and that is certainly something that could be looked at, particularly as we proceed into the world of AI and so forth. It is probably a lot easier today to look at something like that than it was in the past.
Senator Ravalia: Thank you very much, Mr. German.
Senator Surette: Thank you for your presentation. I’m not quite sure how to frame my question, but I will try.
We started looking at the West Coast fishery because we were looking at how they could implement an owner-operator fishery on the West Coast, which would be similar to the East Coast, as you probably know, since you have had experience there.
On the East Coast, owner-operator means there are many more of them than there are on the West Coast, where it is more in the hands of corporations. In some ways, I believe that creates another challenge for DFO in terms of law enforcement because there is more of them. When you talk about corruption or tax evasion, we all know that it is happening there. There are reports coming out now from the East Coast on tax evasion, especially the black market, and there is a situation of controlling agreements that are hard to get your hands on as well.
I’m just curious: On the West Coast, since it is largely corporations, does it bring it to a different level? Are we talking about a different level of money laundering and corruption than what we hear about on the East Coast?
Mr. German: Those are great questions, senator. I think owner-operator is certainly what Ecotrust and other agencies and non-profits are encouraging on the West Coast. There is a lot to be said for owner-operator because of revitalizing communities and so forth.
That said, obviously, the fishery has to be profitable, and sometimes a certain amount of concentration is probably necessary in order to have profitability. But will we witness less tax evasion with an owner-operator system than we do with a more concentrated system? That’s a hard one to answer; maybe, maybe not. The old idea of beating the tax man is something that you are going to see at all levels.
The bigger issue is what you mentioned near the end of your question, and that is this: Are we looking at larger issues when we talk about concentrated ownership? I would say yes, we are. For example, where are the millions of dollars coming from that are purchasing these quotas and licences? What is the source of funds?
The source of funds is absolutely critical when dealing with issues such as money laundering. If you don’t know where the money is coming from, you are at great risk. That’s why banks have to fill out forms and send them to FINTRAC and so forth.
Also, organized crime is there to make a profit and for no other reason. It couldn’t care less about the fishery. It is about money. It could easily be cloaked behind very large organizations. Again, transparency would be important. Thank you, senator.
Senator Surette: The follow-up to the question, then, is this: Some people told us that you should be able to follow the money, so we should be able to track this and get to the challenges or the difficulties we’re facing here.
We should probably look at ways we can set up tools that would work in our favour. If fish quotas and boat sales are not on FINTRAC now, that’s an example of what we should be doing, I assume. The registry you talked about is another tool that should be out there. DFO or government could use that tool to manage the fishery.
Mr. German: That’s right. I agree with you, senator. I would say two things. You need intelligence, as in data and so forth, to make informed decisions. You can acquire that in different ways. We have a financial intelligence unit, and, yes, they should be in a position where they can gather the type of data that you need. A corporate registry would do the same thing.
There is nothing stopping the police from investigating a specific issue within the West Coast fishery or the East Coast fishery. They would start an investigation. They would obtain search warrants and execute those search warrants. Again, unless someone is suggesting a specific crime committed by a specific person or entity, the police aren’t going to become engaged. You need to have this basic information. You have to know what you are dealing with first, and I think that’s where all these data sources can certainly be of great assistance. Thank you.
Senator Poirier: Thank you for being with us and providing the information that you are giving us today.
I was just curious, in your view, what lessons from other sectors that you examined, such as real estate, luxury goods or financial services, could be applied to better regulate the fisheries sector? In particular, are there specific tools or measures that could be adopted to improve transparency and reduce the risk of money laundering in the fisheries?
Mr. German: Thank you, senator. It goes back to transparency. It goes back to what I have already been referring to in terms of having information at your fingertips.
Regarding the real estate market, I will give you an example. If you recall, when Prince Harry and his wife moved to Canada, there was a lot of discussion in the papers that they were renting a property on Vancouver Island, and no one could figure out who owned that property. The media was going crazy trying to find out who the ultimate beneficial owner of that property was. Well, maybe Prince Harry and his wife themselves did not even know who the ultimate owner was, but that’s the issue. With real estate, you want to know who owns property. Do we have organized crime hiding behind a numbered company or some person who is not the beneficial owner? It is no different in the fishery. You need that basic information.
You mentioned luxury goods. Some luxury goods are reportable to FINTRAC. Others are not. The example I always use is used cars. Cars generally are not reportable to FINTRAC. You could purchase a $250,000 car with cash, and that’s not reportable. We have these gaps, and we outline those gaps in our “Dirty Money” reports. We have to fill those gaps in order to get the information to the financial intelligence agencies so they can be effective.
Senator Poirier: In your view, what specific challenges do agencies face in detecting and investigating money laundering within the fishery industry? What recommendations would you make to tackle these challenges?
Mr. German: I’m being a bit repetitive, but, again, I believe you need a vibrant beneficial ownership registry, I believe various aspects of the fishery industry have to be reportable to FINTRAC. I believe, quite frankly, there has to be very specific, dedicated research on this topic using data sources that are available or that could be made available. No one is really looking at this.
I don’t profess to be an expert in fisheries by any means. We really happened upon this sector by chance, when we were asked to take a look at it. I’m not too sure that anyone is looking at the fishery industry on the West Coast, for example, from the perspective of organized crime, money laundering and corruption. Someone should. Does that mean a public inquiry? Does that mean robust consultant work or contract work? I don’t know, but I think someone has to look at it.
Senator Poirier: From your point of view, should that be the top priority that the federal government should look at to address problems related to money laundering in fisheries?
Mr. German: Yes, I think it is important that we find out what we’re dealing with. Ecotrust has raised issues. We looked at some of the issues Ecotrust raised, and we do see connections there. There are connections between people who have large quotas, who are very wealthy and who may also be, for example, gamblers in casinos. You see this interrelationship. Is it necessarily illegal? Are these people necessarily conducting criminal activity? I don’t know, but that’s the whole question. We don’t know.
Senator Poirier: Thank you.
Mr. German: If I may, I did mention the financial crimes agency, and my concern there is that a lot of people will say, “The financial crimes agency will be coming shortly, and it will take care of all of these issues.” Frankly, it will not. It will be a very small start-up agency for many years, and it will be very important that the fisheries enforcement folks have the expertise to look at these areas, as well as the RCMP and other agencies. We don’t want them to walk away from it now that we have a financial crimes agency coming on stream. Thank you.
The Chair: With the mention of the RCMP, we have great representation here from that organization also. With that, we will go to Senator Dhillon.
Senator Dhillon: Thank you, Mr. Chair. Good to see you again, Mr. German. Thank you for being here today.
I will try to pull some of the commentary. I know it is repetitive, but I think it is worth having it repeated so that it really instills in this committee some of the concerns that you are highlighting and the flags that you are raising for us. The Cullen Commission came as a result of the reports that you brought to the province of British Columbia, identifying a variety of industries that were suffering and being used for money laundering, to the point where it was going to create incredible pressures on the economy itself. It was also ripe for organized crime and gangs to continue to grow. They are aware, and they are illicit enterprises.
Our concern or worry, and what we have heard from some of the witnesses thus far, including yourself, is that there is smoke here. We need to turn our minds to it or it is going to get away from us, as it did in other areas, for example, casinos, real estate and so on. The folks who are going to suffer the most are the fishers, the people in the industry and Canadians who take advantage of and benefit from the fishery industry.
First, to that point, I want to say if you feel anything I said needs correcting, I invite that correction.
Second, I’d like you to, if you could, summarize for this committee, in your view, where some of the soft targets are within the fishery industry. I think you mentioned this a few times.
Finally — and I’m sorry for giving you a compound question — you spoke about FINTRAC, the lack of transparency and the lack of contribution into the FINTRAC system when it comes to the fisheries industry. Where are those areas, and what could be improved upon there?
We certainly hear that there is work that will be done with licence transfers, quota ownership and vessel sales, as well as that illicit transactions in fisheries are being transferred through FINTRAC in their poaching and fishing program, but I’m not sure that’s working. They have used the term “neural network.” It is starting to connect. I’m not sure that the neural network is actually connecting with something at this point.
Again, I apologize for the long-winded question and for where I started and ended, but I’m really looking for you to lean into some of your worries, concerns and fears as an expert in this area regarding what we are going to face if we don’t turn our minds to this in a meaningful way and get ahead of the issue, given all the flags and the smoke we’re seeing today.
Mr. German: Thank you, senator, and good to see you again. Thanks for your contribution to the Senate.
I like that term, “smoke,” because that is what we’re seeing. It’s smoke. We have to get through that smoke. We have to get through the fog and find out what’s really going on in this industry.
More generally, organized crime will move where the risk is lowest. That’s a given. People wonder if organized crime is out of the casinos after all the work that was done on the casinos in British Columbia. The answer is that, yes, they’ve probably moved elsewhere. They’re not going to leave the casinos for good, but they will move somewhere else where the heat is not on them. That’s what happens. Then they’ll move to another sector until that gets too hot and they move elsewhere.
I see fisheries as a very vulnerable sector, particularly on the West Coast, for this type of organized crime at a fairly high, sophisticated level, and also as an opportunity to dump money. If we don’t know the source of that money, that’s definitely a vulnerability.
So, what are we looking at? We need to have a strong enforcement capacity. Someone has to be looking at this from an enforcement perspective, whether that’s the fishery officers or that’s the RCMP. Somebody has to be looking at this issue. We have to get that beneficial ownership registry up, running and effective. What they often say about beneficial ownership registries is “garbage in, garbage out.” You need an effective registry where you know who owns what.
We have to solidify the data and the information that goes to FINTRAC and deal with any gaps. I think those are just givens.
You asked me to lean into it. That’s certainly where I’d be starting.
Senator Dhillon: Thank you. I want to emphasize the fact on the record as well, and you said it very clearly, that if the RCMP, Fisheries or anyone who is going to be investigating this, it will only be useful or effective if they have the data or a complainant to that matter.
Mr. German: Correct.
Senator Dhillon: Without any of that, you can have all the agencies in the world ready to do the work, but there’s not going to be much there to follow. Am I correct in saying that?
Mr. German: Yes. We can use casinos as an example, senator. With the issue in our casinos, allegations of organized crime and money laundering in British Columbia casinos had gone on for years — certainly about a decade.
There was every reason given why that was not the case or how it could be something different. The media is very good also at opening up issues. They did that. Every couple of years, there would be a media story about the casinos, but then it would blow over and we’d be back to where we were.
It took, as I said, about 10 years before people finally realized we had a problem and it was out of control.
You could easily face a similar scenario. I don’t want to be a fear monger by any means. But potentially, that’s what you’re looking at in fisheries. All of a sudden, there could be an explosive news story that asks, “Do you know who owns a certain percentage of your quotas?” Then we’re all left flat‑footed and saying, “Well, not really.”
Thank you.
Senator Osler: Thank you for being here today, Mr. German.
At the risk of being repetitive, I’m going to drill down more on Senator Dhillon’s question, some of what you’ve shared and some of the other questions from around the table.
You mentioned in your answer to Senator Dhillon that there are data gaps related to the information that’s reportable to FINTRAC. I’m going to give you some time.
Can you expand on that and tell us what the fishery-related information gaps or data gaps are related to the financial transactions reportable to FINTRAC? In your opening remarks, you mentioned fish quotas and boat sales. Can you tell us specifically what some of those gaps are?
Mr. German: Thank you, senator. You’re hitting on them right there. We’re really talking about quotas and licences; those are the big things here, as well as that consolidation issue. Yes, I believe those should be reportable to FINTRAC. Boat sales would definitely be of interest as well.
FINTRAC is probably the best judge of what they could gather and what would be helpful for them in terms of putting an analysis together. I really think it boils down to the transparency around licences and quotas and making that reportable to FINTRAC.
There are many protections built into FINTRAC in terms of the data it receives. There’s no reason to suggest that there are not. It’s really not even a privacy issue because there’s an acceptance that FINTRAC has a role to play. The banks are feeding data overnight from bank accounts from across the country. There are millions of pieces of data that go to FINTRAC all the time, so I don’t see why we’re not looking seriously at information from the fishery.
In terms of the specifics, I don’t profess to be an expert in that. But I think generally licences and quotas are what we’re looking at on the West Coast.
Senator Osler: Do you have any recommendations for a specific financial threshold that should be reported to FINTRAC?
Mr. German: Yes. Generally speaking, in terms of a threshold, FINTRAC uses $10,000. For example, you can’t cross the border without declaring $10,000. That’s a figure used internationally as well in equivalent currencies. That may well be a good starting point. However, again, I’m not an expert on how much people pay for licences and quotas. Some might say that’s far too low.
What you don’t want to do is burden the industry with paperwork, which has always been the argument — and why car dealers say they shouldn’t have to report because they sell so many cars and it’s too much work.
But there comes a time when government has to say, “You must report,” as the banks were told many years ago. We have to find that threshold, and $10,000 may be it, but it might also be higher.
Senator Prosper: Thank you for your work and testimony, Mr. German. It’s been an eye-opening experience to listen to your testimony and, with the questions here from my colleagues, I am trying to get a grasp on the magnitude of this issue and what needs to be done. It’s obvious that many things need to be done.
I want to look at the lack of capacity in enforcement. I put a question to the minister previously here in committee, looking to see what the correspondence was between Indigenous fishery guardians who are out on the water.
There are mechanisms within the Fisheries Act that can allow them to have powers related to fishery officers. Under the Fisheries Act, there seems to be some momentum, or certainly some discussion there to build on that momentum. It seems to be a win-win type of situation to have more enforcement.
What are your thoughts on that? In particular, it’s not going to be the solution. It seems to be wider in scope. But is it a positive thing, in your mind, to utilize the Fisheries Act to allow Aboriginal and Indigenous fishery guardians to have that type of power to increase enforcement capacity and help address some of these issues? That’s my first question.
My second question relates back to enforcement.
Do you have an idea in terms of the gap and the type of lack of capacity here? You mentioned not putting all our eggs in the basket of the financial crime agency, which is going to take some time to get things together and get some real traction and movement.
I know there are a number of questions here. Could you also get into the type of enforcement? I just went to an AI seminar earlier today and was learning about the beneficial aspects of AI. Certainly, technology and coordination among various agencies and departments come to mind. From a technology aspect, is there anything that you think is a mechanism that can offer some hope?
I know this is a compound question, but I hope it’s clear enough for you to take a run at. Thank you.
Mr. German: Thank you, senator. I worked in the Mi’kmaw lands in Nova Scotia at one time. We used to refer to it as Eskasoni. I have many good memories of there and further down Highway 4 toward Isle Madame.
There are three questions there, but it all boils down to enforcement. I’m a strong believer that you must have enforcement. If you don’t have enforcement, people say, “What’s the downside?” Enforcement is a given.
Question number one is really related to who can do the enforcement. I have personal experience living in a place called Tsawwassen in British Columbia. We have the Tsawwassen Native band right beside us. Their fishery guardians are out there on the water, in front of our house, so to speak. From all indications, they do a great job of policing the fishery. That involves crab there as well.
In terms of your second question, I see it as an issue of capacity. The type of organized crime money laundering we’re talking about requires very specialized knowledge and enforcement capacity. You can’t ask a generalist enforcement officer to become a money-laundering specialist or something. It’s like asking someone to work in a crime lab if they don’t have a science background.
You have to develop a certain expertise in this area of money laundering. There certainly are people with that expertise in the police forces, but it is not what it was a few years ago; let me put it that way. The RCMP is re-creating its money-laundering capacity in its financial area in federal enforcement. I think that’s a good thing. It is possible the financial crimes agency may be of some assistance, but I caution that’s down the road.
I think the fishery officers themselves have the ability to get engaged. Create a unit that looks at proceeds of crime money laundering. I think that would be beneficial, because when you talk about the RCMP or other law enforcement agencies, they have a lot of competing claims on their time. We do know that fishery officers are specialists in that area. They know the language, just as you do, senators. They know what fish quotas and licences are, rather than having to inform a police department that may not deal with fisheries issues on a daily basis.
I do think that Fisheries enforcement officers can develop that capacity.
Your third question dealt with AI and so forth. Again, I’m not an expert there. I do see block chain in terms of a clean food chain, and I see AI in terms of what you can do with respect to the criminal justice system. Lawyers and police are definitely looking at AI. There’s no question it’s going to be of great assistance down the road, but I’m probably not the right person to comment more on that. Thank you.
Senator Busson: Again, Peter, it’s great to see you. I was very interested when you were talking and briefly alluded to one of the issues in your Dirty Money – Part 2 report, which talked about the concern that perhaps there was smoke — that a lot of these fishing quotas had been bought by overseas investors.
Of course, our study is focused on the owner-operator policy, specifically on the West Coast. We see that, in this day and age, to sell a licence or to deal with quotas, we’re talking about six and seven figures for the transfer of these investments. There’s a suspicion that a lot of these are overseas investors.
Without getting too much deeper into the weeds, we all know there have been issues around foreign ownership of properties, specifically in British Columbia but in other parts of this country as well. Does that raise concern for you generally about corruption and money laundering, when another added piece to this puzzle is the suggestion that overseas investors are heavily involved in our natural resources in the fishing industry?
Mr. German: Thank you, senator.
Yes, definitely. Whether it’s our real estate on land or our real estate in the water, it’s really all the same thing, isn’t it? Organized crime, as I mentioned, is going to look for that soft underbelly. If that’s the real estate market, they go there. If that’s casinos, they go there. If that’s fishery quotas, they go there.
It goes back to this issue of the source of funds. That is so critical. That’s what really all of our money-laundering legislation, FINTRAC, and so forth is all about: determining the source of funds.
If a company is going to do business with another company, either domestically or internationally, they’re going to hire due diligence specialists to determine certain things. For example, let’s say you’re trying to acquire a business, either domestically or internationally. You’re going to hire a due diligence specialist who will look at the company that you potentially wish to buy. You’re going to look to determine if it is a clean operating company and if it’s effective and so forth. You’re going to look at their funding.
If you’re going to engage in a joint venture with another company, you want to know the source of funds of that partner. The source of funds is so critical, and we just don’t know that in this industry. We don’t have that information, so I do agree with your premise.
Senator Busson: Thank you very much.
Just to clarify, as we’re moving forward, would you say the biggest problem around getting to the bottom of that and finding a place to start and perhaps — pardon the pun — put down an anchor is around the issue of the registry?
Mr. German: The registry is certainly an important aspect, as is providing information to FINTRAC, because it all goes to shining a light on these areas and providing that transparency that is so important. The largest or the most prevalent NGO in the world in the area of anti-corruption is referred to as Transparency International. That’s its name. It’s a very fitting name for that reason alone, so definitely.
Senator Surette: I want to drill down a little bit more into your smoke.
My first question is at the tail end of what you just answered there. Even if you had the registry, it seems like, in some cases, controlling agreements behind that seem to be much more difficult to detect and to enforce. I don’t know if that’s an issue.
Going back to the smoke, I know in some of your reports you say there’s quite a bit of hearsay and indirect evidence but no concrete evidence of money laundering and organized crime. By “organized crime,” I mean money laundering and tax evasion.
I’m just wondering — are there certain areas that are more obvious than others? There are corporations involved here, independent fishers, First Nations and then there are a lot of different types of fisheries on the West Coast. Where do you see the most smoke? Why do you think there’s smoke there? What are the indications?
Mr. German: Thank you, senator.
I’ve actually spoken with crab processors in the Greater Vancouver area, as well as consultants working with the crab fishery. Quite frankly, some of those individuals are afraid to go public with what is taking place in that industry for fear that either they’ll be blacklisted or will suffer some sort of issue as a result of disclosing what is taking place. That all revolves around a cash-based fishery, crab that is being loaded and not being declared and so forth.
I think it’s more than smoke. My understanding is that there are some real issues there. There have been fines issued by the fisheries enforcement people. As I mentioned, however, it’s almost like the cost of doing business. If people don’t end up in jail or have some really serious repercussions financially, they’re probably going to continue with this type of behaviour.
I’m certainly not in a position to point fingers at any particular ethnicity. I don’t think this is necessarily a First Nations problem. It really goes to a lack of knowledge of who is the ultimate beneficial owner of quotas and licences. Where is the money coming from that they’re using to purchase licences from owner-operators and so forth?
Senator Surette: My next question is going back to enforcement.
You didn’t mention anything about improving legislation, policy or regulations. From what you see, are those all okay? Do you just need more enforcement?
Mr. German: I’m reluctant to say we need new legislation because we’ve had Criminal Code provisions dealing with proceeds of crime and money laundering since 1989. It’s not that we don’t have the laws.
However, we have issues in our criminal justice system that make it very difficult to investigate and prosecute complex crimes, such as onerous disclosure requirements and time limits on prosecutions. Those issues are out there, and I don’t want to minimize them. But I don’t think we necessarily need a new offence, such as “being bad in the fisheries industry,” so to speak. We have those Criminal Code offences already. It’s really a matter of gathering the expertise to investigate and to prosecute.
If I may go back to your earlier question, I wanted to say with regard to beneficial ownership registries — I alluded to it earlier — is this: garbage in, garbage out. What I would hate to see is a beneficial ownership registry created and everybody saying, “It’s done. We’re good.” The experience internationally with those registries is you have to certify the data going in. If you don’t, then anyone can submit the information that they want. There has to be a checking process so that it is accurate. Otherwise, you get that syndrome of garbage in, garbage out. Thank you, senator.
The Chair: I want to thank our witness. Certainly, there’s been some great commentary and some suggestions that I’m sure we’ll be able to develop some recommendations from. Thank you for taking the time to join us this evening.
If there’s any parting advice that you would like to give the committee on our work, Mr. German, I want to give you a minute to do that before we finish up here this evening.
Mr. German: Thank you very much, Mr. Chair. It is a great honour to appear before you. I am so pleased to know that you are looking at this issue. I regret that we don’t have harder information to present. I’m sure NGOs, such as Ecotrust and others who are right there on the ground, can probably provide a lot of information. I did want to provide a sort of larger look at the potential issues that are out there, and I appreciate you all listening. Thank you, and have a great evening.
The Chair: Thank you, Mr. German.
(The committee adjourned.)