Is RCMP stretched too thin to combat Organized Crime?
GARRY W.G. CLEMENT
© 2019 FrontLine Security (Vol 14, No 1)

Is it time to modernize the RCMP mandate?

There is no denying that the Royal Canadian Mounted Police (RCMP) has a proud history, having served Canada well since its establishment in May 1873 as a central police force. When it comes to national law enforcement, the RCMP has endeavoured to be all things to all people. Today, its scope of operations is expanding an all five key areas: Serious and Organized Crime; Financial Crime; National Security; Protective Policing; and Criminal Intelligence. In addition, they also protect VIPs; have jurisdiction (uniform contracts) in eight provinces and three territories; and, through its National Police Services, offer resources to other Canadian law enforcement agencies.

Organized crime, terrorism, illicit drugs, economic crimes, and offences that threaten the integrity of Canada’s national borders are all on the rise, stretching enforcement and investigation budgets to the breaking point. For example, following 9/11, the focus of the RCMP was directed at potential terrorist threats resulting in many officers being tasked with this required mandate. However, the Govern­ment failed to provide the necessary budget requirements, which has resulted in a total erosion of the RCMP’s ability to tackle trans-national organized crime, money laundering, cyber-crime and sophisticated financial crime.


(RCMP Photo)

The inability of the RCMP to tackle these growing issues has attracted the attention of mainstream media, leading to repeated calls for the RCMP to narrow its area of responsibility by offloading contract policing such as municipal and provincial patrols.

Revelations from two key reports shine the spotlight on how massive money laundering, primarily orchestrated by trans-national organized crime groups, has become entrenched in many major Canadian cities.

The 2015 Charbonneau Commission, in which Justice France Charbonneau concluded that corruption and collusion are “far more widespread than originally believed”, found political links in the granting of construction contracts in Quebec. That report noted that organized crime had indeed infiltrated the industry. A few years later, former deputy RCMP commissioner Peter German was asked to look into why so few money laundering cases have been prosecuted in British Columbia despite allegations that the practice is rampant at BC casinos. His investigation, detailed in a report submitted in 2018, found that BC didn’t have a single RCMP officer dedicated to investigating money laundering. This newsflash led to a frenzy of media reporting, giving his 2018 report on money laundering widespread public attention of late.

Such concerns have been building for many years among those dealing with financial crime. As the Charbonneau and German reports, among others, demonstrate, the RCMP is an organization facing enormous challenges. It is clearly time to accept reality and come up with a plan for the 21st Century.

As difficult and varied as these challenges are, they also present an opportunity for change and modernization where institutional leadership shows a willingness to recognize and accept that challenge, and even crisis, is part of a process of transformation. In a law enforcement organization like the RCMP, this means recognizing that while tradition or past practice supports excellence, it does not define or guarantee it.

I also want to highlight that I see an opportunity, which has seldom occurred in recent memory, relative to the impacting change within the RCMP. An opportunity exists to work within a framework established by the current Government that has an unprecedented and welcome focus on developing and implementing reforms focusing on trans-national organized crime and money laundering. While this requires a commensurate focus by the RCMP, it is, in my view, an unparalleled  opportunity to revitalize the Force and consequentially drive significant public safety and security improvements for Canadians.

Experience has shown that criminal and terrorist organizations remain fluid and proactive – and taking full advantage of technology. To combat this, we need a national police force that is comprised of acknowledged experts who are willing to rise to the challenges presented and remain committed to their areas of expertise. The day of the generalist police officer is no longer sustainable and therefore the RCMP must become the FBI, DEA and National Security Investigative Force of Canada.  


(RCMP Photo)

Although the history of the uniform policing contracts with provinces and municipalities has been beneficial in the past, I would argue it is time to reconsider whether this is sustainable in the future. As contracts are renewed, we need to study these models and ensure that we have a system that remains balanced throughout Canada, relative to costs being absorbed by the Federal Government, and ensure that all funds are channeled for the betterment of national enforcement in Canada and not for the sole purpose of maintaining uniform contracts.

There is a growing realization of the special importance of the national investigative and enforcement responsibilities of the RCMP. This is especially acute today and in most effectively balancing the RCMP’s obligations. Keep in mind that when the RCMP entered into its contract policing roles, the internet didn’t exist – and terrorism, organized crime, money laundering, human smuggling and cyber-crime were concepts far from Canada’s shores. Just as the criminal landscape has changed, so must the RCMP.

The argument to off-load contract policing is an emotional issue that has simmered for years. Many senior RCMP leaders owe their careers to the contract policing stream, and are not anxious to see it end.

Under the leadership of then Commissioner Philip Murray, I was part of a team of three senior officers assigned to review the issue of the RCMP’s para-military structure, wherein rank is a means of achieving higher-level pay. The team was comprised of two contract officers and myself as a federal officer. The two contract officers argued strongly in favour of maintaining the status quo, while I, having witnessed the loss of expertise due to members having to seek promotions in other areas of the Force in order to achieve raises and thus a loss of expertise in specialty-skill positions, strongly encouraged either a move to skill-based pay in federal units or permitting promotions not based on the number of subordinates. Unfortunately, the contract model won the day and has resulted in the continuous rotation of qualified members from specialized areas to other areas of the Force, often contract positions. The end result has been ineffective federal investigative units due to the ongoing erosion of skills.


(Photo: J. Brunelle)

As someone who started his career in contract policing I do know the value, however, having been on the outside for the past decade and, as someone, who is still working in financial crime, my 3-plus decades of experience has hardened my position that the current structure of the RCMP and its way of dealing with federal resources is not only unsustainable but is contributing to an ever growing organized crime problem in Canada. The RCMP needs to re-evaluate its multitude of mandates and recognize that the time has come to move forward to effectively discharge its federal responsibilities as a partner within the Canadian and global law enforcement communities.

In turn, the Government must also accept that, as has been well articulated through the media, the problem cannot be solved by throwing money at the issue. The last Financial Action Task Force Evaluation of Canada’s money laundering (ML) regime highlighted some major issues that still need addressing. The most pressing issues were identified as:

  1. Law enforcement results are not commensurate with the ML risk and asset recovery is low.
  2. Financial Institutions, including the six domestic systemically important banks, have a good understanding of their risks and obligations, and generally apply adequate mitigating measures. The same is not true for designated non-financial business and professions, “DNFBPs”. Real Estate firms have gradually increased their reporting of suspicious transactions, but reporting by DNFBPs other than casinos is very low.
  3. Legal persons and arrangements are at a high risk of misuse, and that risk is not mitigated.

Some of the above-noted gaps have contributed to the proliferation of organized crime and trans-national crime groups relying on Canada as a safe venue. It is for this reason that the U.S. Department of State has designated Canada a “major money laundering country” where foreign drug-trafficking gangs are exploiting weak law enforcement and soft laws. The March 2019 strategy report on money laundering, places Canada on a short list of countries vulnerable to significant drug money laundering transactions – along with Afghanistan, the British Virgin Islands, China, Colombia and Macau. Being included in this list underlines the number of threats being reported for the past year by Global News investigations, such as the laundering of fentanyl-trafficking proceeds from China through casinos, real estate and underground banks in British Columbia.

A full gap analysis, with a goal of devising both short-term and long-term strategies, will be a big help in confronting organized crime head on. Investigations of this nature are complex and require investigators and prosecutors who have worked in this arena for several years in order to become value-added and capable of being seen as a threat to organized crime. As there is a huge shortfall in expertise today, only through public/private partnerships will Canada be able to accomplish the kind of immediate impact necessary. In the long term, with dedicated resources, and with the proviso that they remain in the federal enforcement arena, we will begin to see an ability to combat trans-national crime effectively.

The Government needs to accept that the legal profession is vulnerable to being utilized by organized crime for the establishment of offshore trusts, shell companies and in facilitating real estate transactions. Notwithstanding the fact the Bar Associations successfully argued that everything a law firm engages in has solicitor client privilege attached to it, there needs to be a mechanism for providing oversight of all legal firms’ activities. A requirement to have a designated compliance officer reporting to each law society, with fiduciary responsibility for ensuring the firm does not contribute to money laundering, may be a good start.

Additionally, as noted by the U.S. State Department, Canada’s current legal framework is unsustainable. If we want to be effective through enforcement, this may require new legislation such as a wire fraud statute. The U.S. has defined wire fraud as: “a crime in which a person schemes to defraud or obtain money using electronic communications or an interstate communications facility.” In the USA, the statute of limitations to bring a wire fraud charge is five years, unless the wire fraud targeted a financial institution, which doubles the statute of limitations is 10 years. Implementing a similar practice would assist in prosecuting any criminal organization that moved money through electronic means that was criminally derived.

Another element Canada should consider implementing, is the Racketeer Influence and Corrupt Practices statute in the United States. It covers “Any act of bribery, counterfeiting, theft, embezzlement, fraud, dealing in obscene matter, obstruction of justice, slavery, racketeering, gambling, money laundering, commission of murder-for-hire, and many other offenses covered under Title 18 of the Criminal Code.

Lastly, we need to find a balanced and measured approach for dealing with the ramifications of the 1991 Stinchcombe decision in which “the Crown has a legal duty to disclose all relevant information to the defence. The fruits of the investigation which are in its possession are not the property of the Crown for use in securing a conviction but the property of the public to be used to ensure that justice is done.” Never in the history of common law has such a decision had such an impact on the ability to seek to obtain convictions when confronted with organized crime and trans-national organized crime cases. The burden of disclosure and the reluctance by foreign authorities to cooperate due to the full and frank disclosure requirements has contributed to a lot of what is occurring today. This has resulted in what many police leaders refer to as the trial of the investigation and not the accused.  

As government searches for ways to close loopholes, others say it’s time to restore resources to the RCMP and “go hard” at prosecuting money laundering. Port Coquitlam Mayor Brad West has been calling for “a Charbonneau-style Com­mission, that has the power to be able to compel people to testify, to lay criminal charges.”

The RCMP leadership appears to have been listening to the outcry flowing from the German report and media scrutiny.  Deputy Commissioner Michaud told the National Post that they will be revising their recruitment strategy to replace some of the retiring investigative officers over the next two years with civilian positions (ranging from cyber to accounting) to help pursue cyber criminals, money launderers, and other sophisticated criminal activity.

On the surface, this could be seen as a step in the right direction, however, it will not achieve measurable results for several years. Clearly, we are in an era where organized and transnational crime groups are exploiting everything – from nano­technology to quantum computing and artificial intelligence – to carry out their illicit activities, thereby creating myriad challenges for law enforcement and intelligence agencies. For instance, the criminal element has already embraced blockchain technologies and the cryptocurrency arena, which are still not well understood by law enforcement. Thus, expertise is required quickly in order for there to be any measurable successes in the future.


(Photo: Serge Gouin, RCMP)

One dilemma facing the RCMP is that they have already acknowledged a lack of investigative resources, and therefore, diminishing investigative capacity for the purpose of engaging support experts is counter-productive.

Secondly, the organization still has not come to grips with its archaic paramilitary system of promotions, which continues to result in a revolving door of personnel in specialized investigation units. That approach needs to be dissolved and replaced with skills-based pay. Without such a revision, how can the RCMP expect to retain subject matter experts when these same skills are highly valued by the private sector (at a substantially higher pay scale)?

Considering the 38% drop in police applications in recent years, this clearly highlights the need to develop a strategy that makes a career in the RCMP attractive – whether it be civilian or officer. The FBI is way ahead of us on this, and has already adopted a STEM strategy for recruiting:

“Science, Technology, Engineering and Mathematics: meet investigations! STEM backgrounds are an inherent part of all FBI jobs. From crime scenes to the state-of-the-art Lab at Quantico, we use STEM skills to protect our nation. Are you ready to apply your knowledge to a higher calling?”

Wrapping up, the RCMP would be well advised to begin training existing qualified federal officers to meet current challenges now, and to recruit replacement federal officers with STEM skills. The most recent revelations have clearly detailed the empirical and practical consequences of the non-performance of the current RCMP structure and the legislative shortcomings that need addressing – and the time has come to deal with it now.

___
Garry W.G. Clement is the former National Director for the RCMP’s Proceeds of Crime Program. He is currently President and CEO of the Clement Advisory Group.

RELATED LINKS

Comments