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News Release

As International Anti-Corruption Day Passes By, Canadian Governments Continue to Fail to Fulfill UN Convention Against Corruption Requirements

Tuesday, December 9, 2008

OTTAWA - Today, on International Anti-Corruption Day, Democracy Watch called on all federal, provincial, territorial and municipal political parties and politicians to close key loopholes in laws,  regulations and ethics codes across Canada that allow for corrupting secret donations to many political candidates, and secret lobbying of politicians, political staff, appointees and government officials.
Democracy Watch also called on the federal government to fulfill its commitments under section 52 of the United Nations Convention Against Corruption, and the international Financial Action Task Force (FATF) standards, by amending the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA) to require Canadian financial institutions to monitor the bank accounts of senior politicians and government officials and their families and associates in all levels of government, thereby adding them to the watch-list of the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC).

In December 2006, federal politicians quickly and quietly passed Bill C-25, which only added foreign politicians and key officials and their families to FINTRAC’s watch-list.

As well, because of loopholes the federal Conservatives’ so-called “Accountability Act” left open, and because of loopholes in provincial, territorial and municipal laws, it is currently effectively legal:

  • to make a secret, unlimited donation of money, property to a nomination race or party leadership candidate (and, in some jurisdictions, to an election candidate) who is not a sitting politician (as long as they don’t use the donation for their campaign);
  • to make a secret donation of services to a political campaign (because of lack of requirements to disclose who is providing services to campaigns);
  • for political parties and riding associations to have secret trust funds (some governments even allow such trust funds to benefit sitting politicians);
  • for politicians, their staff and government officials to accept valuable gifts (because they only have to disclose property they own worth more than $10,000), and;
  • for an in-house corporate lobbyist to lobby in secret (usually as long as they lobby only 20% of their work time on average).
"All Canadians should be very concerned that politicians across Canada have left open loopholes that legalize secret, unlimited political donations and secret lobbying, both of which are a recipe for corruption," said Duff Conacher, Coordinator of Democracy Watch. "International standard-setting agencies have concluded that to combat corruption effectively, governments must close these loopholes and require financial institutions to track the bank accounts of politicians and government officials and report suspicious transactions to enforcement agencies."

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Duff Conacher, Coordinator of Democracy Watch
Tel: (613) 241-5179

To see details about the UN Convention Against Corruption, clic k here

To see Bill C-25, click here
and to see the related news release and backgrounder, click here

To see details in the Department of Finance's June 2005 consultation paper,
Chapter 1, section 1.5 entitled "Politically Exposed Persons (PEPs)", click here
and to see the related news release, click here

To see federal Finance Minister Jim Flaherty's October 11, 2006 speech to the
Financial Action Task Force meeting in Vancouver, click here

To see Democracy Watch's list of the loopholes in the federal government's accountability system, click here

Democracy Watch's Money in Politics Campaign

Democracy Watch's Government Ethics Campaign