Financial institutions say Emergencies Act needs more clarity, less onus on banks

By Laura Osman, The Canadian Press on November 17, 2022.

OTTAWA – Banks and credit unions want more clarity about how extraordinary powers will affect their customers’ accounts the next time the Emergencies Act is invoked, a parliamentary committee heard Thursday.

Representatives of the Canadian Bankers Association and the Canadian Credit Union Association testified before an all-party committee studying the impact of the act’s powers invoked last winter.

Prime Minister Justin Trudeau declared a public order emergency on Feb. 14 in an effort to stop protesters from blockading the downtown streets of Ottawa and several international border crossings over their opposition to COVID-19 public health restrictions.

The act granted extraordinary powers to police, governments and banks, including the power to freeze the accounts of people associated with the protests.

The committee heard that in the first few days after the federal emergency was declared, some customers started making major withdrawals from their credit union accounts because they were fearful the government would seize their money.

Some of those withdrawals were hundreds of thousands of dollars, said Michael Hatch, the vice-president of government relations for the credit union association.

“Of course there was panic, people didn’t know what the orders meant,” Hatch told the committee Thursday.

In the end, the orders affected a relatively small number of customers, the committee heard: only about 10 with credit union accounts and another 180 associated with banks.

But customers weren’t the only ones with questions about the emergency powers and how they worked.

RCMP provided a list of names to banks and financial institutions with instructions to freeze their accounts because of their association with the protest.

But banks were also ordered to use their own monitoring systems to determine if their customers were involved in the protest — freeze those accounts as well — explained the bank association’s lawyer Angelina Mason. No specific criteria were given to the banks by the government about how to do that.

“Financial institutions shouldn’t have to be put in the position of determining whether a conduct is illegal,” Mason told the committee.

The bankers association asked the government whether there were any exemptions for particular accounts or scenarios, like the payment of child support as an example, but was told there were none.

That is in contrast to the system set up to enforce sanctions laid out by the government, Mason said.

The association asked the finance department for more information, but the situation was soon considered moot because the orders were revoked on Feb. 23.

As soon as the order was lifted all the accounts were unfrozen, with the exception of those that were frozen as part of a court order, Mason said.

The all-party parliamentary committee was struck to investigate how the powers were used, and is working in parallel with the Public Order Emergency Commission, an independent inquiry led by commissioner Justice Paul Rouleau.

The committee also plans to examine the role of fundraising platforms in the protests, but those efforts were stalled Thursday when the co-founder of GiveSendGo, Jacob Wells, showed up more than an hour late, with just 10 minutes left to hear his testimony.

When he logged in for his virtual appearance he cited a family emergency.

The chair, NDP MP Matthew Green, had initially told the committee Wells pulled out of his virtual committee appearance just minutes before he was expected to take questions from parliamentarians on his involvement in fundraising for the “Freedom Convoy” protest that rolled into Ottawa in late January.

Wells was closely involved in the protest organizers’ fundraising efforts, though most of the $12 million in donations collected on the GiveSendGo platform was ultimately returned to donors.

His testimony is expected to be rescheduled to Dec 1.

This report by The Canadian Press was first published Nov. 17, 2022.

24
-23