Canada's Original Think Tank

Committee of the Whole – Cabinet ministers on Bill C-45, An Act respecting cannabis and to amend the Controlled Drugs and Substances Act, the Criminal Code and other Acts (Cannabis Bill)

Committee of the Whole – Cabinet ministers on Bill C-45, An Act respecting cannabis and to amend the Controlled Drugs and Substances Act, the Criminal Code and other Acts (Cannabis Bill)

Committee of the Whole – Cabinet ministers on Bill C-45, An Act respecting cannabis and to amend the Controlled Drugs and Substances Act, the Criminal Code and other Acts (Cannabis Bill)

Senator Joyal: 

Ministers, welcome. My first and foremost interest in relation to Bill C-45 is its impact on the Aboriginal population of Canada, taking into account the plight of Aboriginal youth, especially the high level of suicide rates on reserves and so on, and the plight of the health condition of Aboriginal people, Aboriginal women especially. But I see my colleague Senator Sinclair and other Aboriginal senators who I hope are on the list to address those issues with you, so I will stick to my second preoccupation, one that seems to have motivated the government to move forward with Bill C-45, which is to deprive criminals and organized crime from the benefit or the profit of the sale of cannabis.

It seems to me that there’s still a big loophole in the initiative taken by the government to block organized crime from the production and sale of cannabis. Mr. Minister, I want to quote the Acting Commissioner of the RCMP, Mr. Kevin Brosseau, whom you know quite well. He testified last Thursday before the Standing Senate Committee on Legal and Constitutional Affairs. Here is what Acting Commissioner Brosseau has stated:

Given the involvement of organized crime in the illicit cannabis market, we do not expect that the legislation will eliminate organized crime’s presence in the cannabis market. . . .

. . . organized crime is constantly evolving and, frankly, one step ahead, seemingly, at times . . . .

In other words, we know that they read the paper like you and me. They have read it since the last election. They knew it was coming, and I think they have moved in a different way to maintain their presence in the market.

This affirmation that I made comes from a report that was published two weeks ago, following research by two journalists in relation to who stands behind the ownership of the 86 companies that have been authorized by Health Canada to produce and sell cannabis. Among the 86 companies, 35 are financed through “fiscal paradise.” I can give you statistics that are mind-boggling: ABcann Global, $12 million from Cayman Islands; Aurora Cannabis, $32 million from Cayman Islands; CannTrust, $2 million; Supreme Cannabis Company, $10 million; Cannabis Wheaton, $20 million; Hydropothecary, $15 million; DelShen Therapeutics $3 million; Emblem Cannabis, Cayman Islands, $8 million; Gold Leaf, $5 million; Invictus MD, Cayman Islands, $14 million; and Maricann, $9 million. I could go on. That’s only for the Cayman Islands.

My preoccupation is that the way that Health Canada is granting the permit and the way that they screen where the money comes from is not sufficient to guarantee Canadian taxpayers that in fact we’re not doing through the back door what we were trying to eliminate from the front door. It seems to me that they come back from the back door through the fiscal paradise.

After I read that report, I consulted the form that regulates the information that Health Canada requests from the companies. Of course, the information that they request is pretty simple to bypass. You don’t have Maurice (Mom) Boucher, the leader of organized crime in Montreal, incorporating under “Boucher cannabis corporation” and sending you his fingerprint to get a permit. He will do that through all the law firms and accounting firms that I don’t need to name, whose names have been published extensively, who will organize for you a way to bypass the front line of the screening. Send your money back to the fiscal paradise in the Bahamas, Cayman Islands, Virgin Islands, Switzerland, Luxembourg, Hong Kong or Singapore. It’s mind-boggling to see who is financing the companies that have a permit.

If we want to address organized crime, we have to strengthen the criteria and identify the money that comes from paradise somewhere to support those companies that tomorrow will sell the cannabis that you will buy from the provincial store.

My question is easy: Are you ready to review the criteria to make sure that we know where that money that hides behind the smokescreen of identity comes from, so that Canadians know that in fact we have not made it easier for organized crime to get the permit to sell it to the kids and to everyone we want to prevent from accessing it?

Some Hon. Senators: Hear, hear!

The Chair: Ministers, you have three minutes to answer.

Mr. Goodale: I certainly appreciate the senator’s passion on this topic. The government absolutely shares his ambition.

The fact of the matter is that today the cannabis market in Canada is 100 per cent controlled by organized crime. We’ve got to do better than that. These things are difficult to measure, as the question would imply. The experience of some states in the U.S., after four or five years of a different regime, is that the engagement of organized crime has been reduced by approximately 75 per cent. That is the kind of statistic that Deputy Commissioner Brosseau would have had in mind when he answered the question in the Senate the other day.

The RCMP will obviously be very active and proactive in tracking down the tentacles of organized crime wherever they exist in Canada, whether in the cannabis industry or anywhere else.

The present regime provides for background and security checks. Following the ample discussion that was referred to earlier, the federal, provincial and territorial finance ministers have also arrived at a common agreement that they want the true and real ownership of cannabis firms identified, and they have arrived at agreements regarding the tracking of cash to make sure we are able to do that.

Madam Chair, in conclusion, we take the senator’s admonition with a great deal of seriousness. What he has described as an objective to eliminate the tentacles of organized crime is an objective that every member of our government shares.

The Chair: You have five seconds.

Senator Joyal: Are you willing to amend the regulations of Health Canada to make sure that we know the identity of who hides behind the money coming from the fiscal paradise involved in the production and sale of cannabis in Canada, yes or no?

Mr. Goodale: We are prepared to look at every element of our implementation approach, including this one, to make sure it’s effective.