OTTAWA –
The NDP accuses the Liberals of basing their sanctions regime on “political theatre” as data suggests few funds have been frozen and none seized.
“This government constantly pats itself on the back for adding individuals to the sanctions list,” NDP MP Heather McPherson said in the House of Commons on Tuesday.
“Liberals claim that sanctions are a key piece of our foreign response, but there is no enforcement, no investigation and almost no asset seizures.”
The federal government has been announcing sanctions on an almost weekly basis that prohibit people associated with authoritarian regimes from having financial transactions in Canada and from entering the country.
Yet publicly released RCMP data shows little change in the amount of money frozen in Canadian bank accounts between June and December last year, despite hundreds of people being added to sanctions lists.
As of June 7, Canada had ordered a freeze of $123 million in assets within Canada and $289 million in transactions had been blocked, both under Russia-related sanctions bans.
In late December, the RCMP said $122 million in assets had been seized and $292 million in transactions blocked, despite hundreds more people associated with Russia being placed on the sanctions list.
Police did not have an explanation as to why the amounts reported by financial institutions had barely changed during that period.
In late December, the RCMP noted that no bank had informed them of any sanctioned Haitians or Iranians holding assets in Canada.
Meanwhile, parliamentary disclosures requested by McPherson show that Ottawa has yet to use a law passed last June that allows the government to seize funds from sanctioned individuals and divert them to victims of wrongdoing.
The government issued a property restraining order in December to begin the process of forfeiting $26 million held by a company owned by Russian oligarch Roman Abramovich, but has yet to file an application in court.
McPherson argues that Canada is using sanctions as a token tool, without taking steps to actually discourage support for autocracies.
Foreign Minister Melanie Joly responded to the criticism by offering to work with the NDP on using sanctions to seize assets and divert them.
“We are the first country in the world to do this and we will lead,” he told the Commons.
“We have imposed extremely strong sanctions against the Russian oligarchs, the Belarusian oligarchs, the Haitian elite and the Iranians.”
Sanctions experts have long argued that Canada lacks the means to properly monitor its regime, such as tracking financial transactions and tracking how assets are traded.
For years, the US State Department has considered Canada a “major money laundering country” due to its weak enforcement.
In March 2022, the department included Canada in a published list of 80 countries it believes have inadequate tracking of financial transactions.
Canada’s new asset forfeiture law is the first among the G7 countries to attempt to seize financial holdings using sanctions law.
Analysts and lawyers have said it marks a major shift in how countries use sanctions, which are typically created as temporary measures to try to change behavior, with the idea of unfreezing accounts later.
Instead, the new law seeks to punish people accused of human rights abuses. Funds can only be used to compensate victims, rebuild affected states, or support peace initiatives.
This report by The Canadian Press was first published on January 31, 2023.
