Shady finance investigations let go amid police constraints: RCMP note

The RCMP says many tips from Canada's financial intelligence agency about possible crimes "may not get investigated" due to a lack of policing resources and conflicting priorities.

The Mounties make the candid admission in a briefing note prepared for Public Safety Minister Marco Mendicino on the working relationship between the national police force and the Financial Transactions and Reports Analysis Centre of Canada, known as Fintrac.

The Canadian Press used the Access to Information Act to obtain the briefing memo, which was approved by RCMP Commissioner Brenda Lucki last Sept. 1.

The RCMP receives financial intelligence from Fintrac, which could shed light on money laundering or terrorist financing, in two ways.

The first is through a response to a voluntary information record, which advises Fintrac of potential criminal activity and might prompt the centre to release information related to suspects.

The second is through proactive disclosures from Fintrac when they point to possible criminal activity gleaned from analysis of information the centre receives from banks, casinos and reporting organizations.

The RCMP briefing note says Fintrac's analysis is of "significant tactical importance" to the force, as it may uncover previously unknown conspirators, assets, transfers and relationships.

"In some files, assets may only be identified through Fintrac intelligence — which is key for the RCMP to obtain restraints and forfeitures," it goes on.

However, receipt of intelligence through voluntary information records, or VIRs, "can be a lengthy process," the note says.

Fintrac's turnaround time to produce a non-urgent financial disclosure can take several months, "which affects the ability to investigate in a timely manner" and can hinder probes.

"Many of the proactive disclosures provided may not get investigated based on the capacity of law enforcement to analyze the information in a timely manner, as well as conflicting operational priorities," the briefing note adds.

"Fintrac should prioritize the disclosure of intelligence based on VIRs provided by law enforcement before any proactive work."

Asked about the note, Fintrac said its proactive disclosures to law enforcement and national security agencies are key to helping protect vulnerable Canadians, fulfilling the centre's "detection" mandate and meeting international obligations.

It pointed to Project Protect, a public-private partnership combatting human trafficking for sexual exploitation, in which 90 per cent of the centre's disclosures to law enforcement were done proactively, "identifying criminals and criminal networks that were previously unknown and helping to rescue and save the lives of numerous victims across the country."

Overall, Fintrac's financial intelligence contributed to 335 major, resource-intensive investigations in 2021-22 as well as hundreds of other individual investigations at the municipal, provincial and federal levels, the centre said.

"Many of the recipients of Fintrac's disclosures have told the centre that they will not start a major project-level investigation without seeking out its financial intelligence."

The addition of almost $90 million in the last federal budget is helping Fintrac upgrade tools to ensure its financial intelligence "is even more timely and responsive," the centre added.

Mendicino's office declined to comment on the briefing note.

RCMP spokeswoman Robin Percival had little to add, saying the force's partnership with Fintrac is key in the fight against money laundering and terrorist financing.

"The RCMP continues to work collaboratively with Fintrac in both an investigative context and on proactive crime prevention efforts."

The RCMP note suggests the government consider broadening the scope of federal proceeds of crime and terrorist financing legislation to include other criminal offences, as the "current narrow focus" limits Fintrac's analysis.

Percival said changes to information-sharing practices between the RCMP and its partners require legislative change, which takes time.

"The RCMP continues to work closely with the Department of Finance and Public Safety, providing recommendations on potential improvements to the anti-money laundering regime."

This report by The Canadian Press was first published Jan. 10, 2023.