Thursday, October 12, 2006

OTTAWA - Today, Democracy Watch called on the federal Finance Minister Jim Flaherty to close a key gap in Bill C-25 by adding senior Canadian politicians and government officials to the bank account watch-list of the Financial Transactions and Reports Analysis Centre of Canada (Fintrac).  This change is recommended by the international standard-setting Financial Action Task Force (FATF) and Article 52 of the UN Convention Against Corruption.

The FATF, meeting today in Vancouver and now headed by former Department of Finance financial institutions’ policy director Frank Swedlove, recommends that the accounts of all “politically exposed persons” (PEPs) be tracked.

Article 52 of the UN Convention Against Corruption states that:

"...Each State Party shall take such measures as may be necessary, in accordance with its domestic law, to require financial institutions within its jurisdiction . . . to conduct enhanced scrutiny of accounts sought or maintained by or on behalf of individuals who are, or have been, entrusted with prominent public functions and their family members and close associates...."

However, Bill C-25 only adds the bank accounts of foreign politicians and key government officials and their families to Canadian financial institutions’ and Fintrac’s watch-list, not Canadian politicians or government officials.

“The federal Conservatives are playing the same dangerouslynaive game that all past Canadian governments have played by pretending that corruption only affects foreign governments,” said Duff Conacher, Coordinator of Democracy Watch. “While the proposed Federal Accountability Act includes a much-overdue ban on secret donations to election candidates and politicians, and the Criminal Code bans bribes of politicians and government officials, international standard setters have made it clear that such bans are impossible to enforce effectively unless the bank accounts of politicians and government officials are tracked closely.”