9/11 – ten years later

By Christine Duhaime | September 10th, 2011

The eve of the ten year anniversary of 9/11 is a good time to look back at the pivotal changes that have shaped our legal landscape in counter terrorist financing. Ten years ago, few lawyers practiced in the area of national security and in particular terrorist financing. Since 9/11, terrorist financing and its companion, money laundering, have become more familiar to jurists and indeed to Canadians. Many believe, however, that despite changes to the law, Canada remains unprepared, legally-speaking, for the potential proliferation of terrorism.

In the 1970s, Europe and the Middle East were affected by increased terrorist activities and as a result, the international community focused its attention on legal mechanisms to address these events. International conventions were adopted to address particular forms of terrorist activity (hijackings, kidnappings, bombings) occurring in different locations. The Convention for the Suppression of Unlawful Seizure of Aircraft and the International Convention against the Taking of Hostages are two examples.

By 9/11, Canada had implemented ten of the then twelve international anti-terrorism conventions into Canadian law largely by codification of relevant offences in the Criminal Code. Despite the potential for a fiat power to permit federal prosecution of national security related proceedings, prosecutions were largely conducted by provincial prosecutors who relied on investigations undertaken by various police agencies at the municipal, provincial and federal levels.

Legal Response to 9/11

Immediately after 9/11, the international legal community responded with Security Council Resolution 1373, adopted on September 28, 2001. It condemned the acts of 9/11 and called upon countries to work together to prevent and suppress terrorist acts, noting the link between money laundering, organized crime and international terrorism. The Resolution directed countries to prevent and suppress terrorist financing and to criminalize the provision or collection of funds that are known or intended to be used for terrorism and to freeze terrorist assets. In respect of persons participating in, or supporting terrorist acts, countries were required to impose punishments that reflected the seriousness of terrorist financing and terrorist activities. Finally, countries were required to exchange information in respect of terrorist financing and money laundering, and to deny safe haven or other forms of support to terrorists or those who facilitate terrorism or terrorist financing.

Canada did not, at that time, have Criminal Code provisions to adequately deal with terrorist financing, or terrorism generally. There were no tools to prevent or disrupt terrorist activities, criminalize the facilitation, preparation or direction of terrorist activities or their financing, nor provide sufficiently strong penalties for terrorist related offences.

Canada’s Legal Response to 9/11

Canada adopted Resolution 1373 by implementing the Regulations Implementing the United Nations Resolutions on the Suppression of Terrorism. It prohibited Canadians from dealing with the assets of listed persons, facilitating transactions with them or otherwise making property or other financial services available, directly or indirectly, for the benefit of a listed person, and to report to the RCMP and CSIS the existence of terrorist property.

Canada also adopted the Anti-Terrorism Act on December 18, 2001 which amended several statutes including the Criminal Code and the Proceeds of Crime (Money Laundering) Act.

The changes to the Proceeds of Crime (Money Laundering) Act (which then became the Proceeds of Crime (Money Laundering) and Terrorist Financing Act) included:

  • expanded reporting of transactions where there are reasonable grounds to suspect are related to a terrorist financing offence; and
  • expanded information sharing powers of FINTRAC when it has reasonable grounds to suspect that the information would be relevant to investigating a terrorist financing offence or if there are threats to national security.

Changes to the Criminal Code included:

  • defining what constitutes terrorist activity (e.g. an act or omission committed in or outside of Canada referred to in the ten international anti-terrorism conventions listed in §83.01(1)(a) of the Criminal Code, or coming within the “made in Canada” general definition of terrorist activity in §83.01(1)(b) of the Criminal Code, namely conduct committed for a political, religious or ideological purpose with a motive requirement);
  • defining what constitutes a terrorist group (e.g. an entity that has as one of its purposes or activities, the facilitating or carrying out of terrorist activity or that is a listed entity);
  • provides for the listing of entities by the Governor-in-Council when there are reasonable grounds to believe that the entity has knowingly acted on behalf of, at the direction of, or in association with such an entity. Listings are made on the basis of recommendations from the Minister of Public Safety and Emergency Preparedness and once listed, an entity is a terrorist group. Being listed does not in and of itself, attract criminal consequences;
  • provides for the delisted of listed entities by application to the Minister of Public Safety and further judicial review of a decision refusing a delisting;
  • provides additional terrorist financing offences such as providing or collecting property for terrorism, or providing or making available property or services for terrorism or using or possessing property for terrorism. Certain knowledge and intention requirements are built into the offences; and
  • provides mechanisms for the freezing, seizure, restraint and forfeiture of terrorism-related property without requiring a criminal charge or conviction.

Future Changes to Counter Terrorism Law

This week, Prime Minister Stephen Harper said he would resurrect two contentious clauses from the Anti-Terrorism Act that lapsed in 2007 – the recognizance with conditions (known as preventive arrest) provisions which allow police to arrest suspects without a warrant and hold them for up to 72 hours if they have reasonable grounds to believe that a terrorist act will be carried out and reasonable grounds to suspect that the recognizance of the person is necessary to prevent the terrorist activity from being carried out; and the investigative hearing provisions which allow a judge to compel someone with information in respect of a terrorism offence to appear before him or her and answer questions.

This year, the Supreme Court of Canada is scheduled to hear several difficult cases on counter terrorism, including an appeal by Mohammed Khawaja, who was convicted of terrorist financing and other terrorism offences. He was an active member of a terrorist group whose goal was to eradicate western culture in, among other places, Canada, and establish in its place, Islamic dominance. His stated goal was to drain the economies of “kuffars” (a derogatory term for non-Muslims) of their resources, crippling their industries and bankrupting their systems by violent and the random murder of civilians.

The Court has also agreed to hear an appeal by Suresh Sriskandarajah who is appealing an extradition order to the U.S. Sriskandarajan is alleged to have laundered money in the U.S. to provide financial resources to the Liberation Tigers of Tamil Eelan, a designated terrorist organization, and to have engaged in terrorist activity financing. According to a complaint filed in the U.S. District Court for the Eastern District of New York, Sriskandarajan wrote several explicit emails instructing student couriers how to lie and bribe to officials to smuggle equiement for terrorism.

Finally, pursuant to its adoption of Resolution 1373 and the FATF standards, Canada is likely to take measures to address its record in combatting terrorist financing, including considering whether to amend the motive requirement in the definition of terrorist activity that requires proof of the motive of the perpetrator, a legal requirement that is uniquely Canadian.

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