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Nov. 17, 2022 - Viva & Barnes
10:09:05
Emergencies Act Inquiry - Nov. 17, 2022 - Live with Chat
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And the other one.
The Public Order Emergency Commission is now in session.
Good morning.
Bonjour.
Nice wintry day.
We're starting off with some bulk entries, I believe.
That's correct, Commissioner.
Eric Brousseau, Commission Council.
This is just to formally enter 286 documents by way of bulk entry, which is actually the sort of combination of a couple of weeks of lists.
We are playing catch-up.
Objections were removed.
They are being dealt with.
These documents are largely sort of municipal and provincial documents, including documents produced by the governments of Manitoba, Saskatchewan, Nova Scotia.
The institutional report for the government of Manitoba and Saskatchewan and several witness statements as well.
And it was circulated to the parties.
The final list was circulated recently and they will be entered as exhibits today.
Okay, thank you.
And now I understand we have a panel judging by the arrangement.
I gather there are three.
Okay.
and Commission Council.
Good morning.
Bonjour.
Thank you.
Bonjour.
Bonjour.
Okay.
Good morning, Mr. Commissioner.
Gordon Cameron, on behalf of Commission Council, and you have before you this morning a panel of witnesses representing the Department of Finance of the Government of Canada.
Could I ask that the witnesses be sworn or affirmed?
Ms. Jacques, will you swear on a religious document, or do you wish to affirm?
I swear.
Will the Bible, the Quran, or the Torah available?
of the Bible.
For the record, please state your full name and spell it out.
Isabelle Jacques, I-S-A-B-E-L-L-E-J-A-C-Q-E-S.
J'aurez-vous que le témoignage que vous allez rendre devant la commission sera la vérité, toute la vérité et rien.
Do you swear that you will speak the truth and nothing but the truth, I swear?
Will you swear on a religious document or do you wish to affirm?
The Bible's good.
For the record, please state your full name and spell it out.
Michael Sabia, M-I-C-H-A-E-L, S-A-B-I-A.
Do you swear that the evidence to be given by you to this commission shall be the truth, the whole truth, and nothing but the truth?
Yes, I do.
I do.
Thank you.
Good morning and bonjour, panel.
We will begin with some formalities, the adoption of your witness statements and the such, and I will ask you questions for 20 minutes or so.
Then I will hand it over to my colleague, Mr. Hebar, who will cover a specific topic with some of you, and then I'll come back up to finish it off.
So if we could begin with those formalities, we want you to put onto the record some of the documents that you've prepared for the Commission and that Commission Council prepared in conjunction with you.
And in particular, if I could begin by talking about the institutional report that was filed by the Department of Finance, and it doesn't matter which of you adopts it for these purposes, but I'll...
Ask you, Mr. Sabia, if you reviewed that document, confirmed it for its accuracy, and can adopt it as part of the evidence of the Department of Finance before the Commission?
Yes, I can.
Thank you.
And you were interviewed as part of a panel, and an interview summary was generated as a result of that interview.
For each of you, I'd like to confirm that you reviewed that summary of your interview for accuracy, that you do believe it is accurate and that you adopted as part of your evidence before the Commission today.
Can I ask each of you to confirm that?
In my case, yes.
Yes.
Yes.
Thank you.
Now I'll ask you the easiest questions, I think, for today, which is to introduce yourselves to the Commissioner.
With a description of who you are and what your role is in the Department of Finance.
And so let me begin with you, Mr. Sabia, if you could tell us your title, your role, and how that fits with the Department of Finance.
I'm the Commissioner.
I'm the Deputy Minister of Finance.
So I'm the most senior non-elected official in the department, and we all work.
And I report directly to the Deputy Prime Minister and the Minister of Finance, Chrystia Freeland.
Do you want me to talk about what the department does?
That'd be helpful, what the department does and how you oversee those activities.
Well, how I oversee those activities is an interesting question.
So we're, I guess it would be fair to say we're the government department that's charged with the oversight, stewardship, if you will, the oversight of the Canadian economy.
That has several dimensions in our work.
So we're responsible for tax and fiscal policy on behalf of the Government of Canada.
We're responsible for the financial and fiscal dimension of federal-provincial relations.
We're responsible for international economic policy, especially related to trade and some other things.
Spending side of economic development and social policy of the Ghana across the government and my two colleagues who will introduce themselves.
We're also responsible for economic analysis and economic forecasting on behalf of the government of Canada.
That's what Rhys Mendes on my left is responsible for and then on my right.
Another dimension of our work is our responsibility for policy with respect to the financial sector in Canada, and Isabelle Jacques is the Assistant Deputy Minister responsible for that.
Well, thank you.
And with that introduction, perhaps, Miss Jacques, you could describe your responsibilities in the Department of Finance?
Yes, I'm Isabelle Jacques.
I'm the Assistant Deputy Minister responsible for the financial sector policy.
We're responsible for the development of policy in the financial sector, as I mentioned.
In my team, I have five directorate, five divisions.
Two of them were involved in the work that we did for the economic order.
The first one was the Financial Crime and Security Division.
The second one was the Financial Institution Division.
We are involved in a number of policy work, and in this case, we worked on both the Proceeds of Crime, Money Laundering and Terrorist Financing Act, and also did work with respect to potential amendments to the Bank Act that made their way into the emergency order.
Just so that I can make sure it's clear to the...
People observing who aren't as familiar with all of this process as some of us have become so far.
Is it correct to say, Majak, that you and the people who work with you in your section were primarily responsible for developing the legislative instruments and, in particular, the emergency economic measures order that we will end up talking about today?
That is accurate.
Thank you.
Mr. Mendez, could you describe your role?
Yes, I'm Assistant Deputy Minister for Economic Policy in the Department of Finance.
I report to Mr. Sabia.
My branch is divided into two divisions.
The first division focuses on assessing the current state of the economy, monitoring the evolution of the economy in the near term, and assessing the economic outlook.
That was the division that was involved in assessing the Thank you very much, and I think we'll probably find that most of Ms. Shuhebar's questions will be directed to you, but if you have something to contribute to the questions I ask, please feel free to do so.
If I could begin by asking you...
Beginning at the beginning, chronologically, when, from the Department of Finance's point of view, the convoy and protest events that we've been talking about in this commission first came on the horizon as an issue for the Department of Finance?
um we as a standard practice um review on a real-time basis uh events that We believe that are occurring that can have a meaningful impact on the Canadian economy.
That's a core part of what Reese's Group does.
So this issue came on our radar screen, I would say, sort of late January as events were unfolding.
There were the beginnings of blockades at the Canada-US border.
So let me just back up a little bit from that and explain why this became such a focus of concern on our part.
There are two, I think, quite important things playing out in the background here.
First, As you'll recall, at the time, there was a great deal of speculation, and indeed in retrospect, Russia's invasion of Ukraine was imminent, and that was something that we were very focused on and very concerned about the economic consequences that that would have globally and the therefore spillover consequences that that would have for Canada.
And then second, Because it was late January and February in the usual budget cycle, we were fully engaged in the preparation of what became the April 22 budget of the Government of Canada.
And as you know, budget making is a lot about understanding what the next period of time looked like for the Canadian economy.
And this is, I think, important in understanding The origins of our concerns.
So, if you'll recall, January, February of '22, our economy was just exiting from all of the COVID lockdowns.
And we were very concerned about the extent of that recovery, the pace of that recovery.
How fast we would recoup lost output, how fast we would recoup lost jobs, because really throughout the COVID crisis, one of the government's objectives had been to minimize any economic scarring, longer-term scarring, that would be the result of the COVID crisis.
So that, given our focus on economic recovery and the pace of recovery, there were two or three things in the environment that we were especially concerned about.
These are not necessarily new things.
One, as everyone knows now, the extent of the damage to supply chains and the impact that that would have on the pace of recovery.
Relatedly, at the time, incipient issue of inflation, something that was partly the result of the supply chains, but also it likely would flow from Events in Ukraine because of the sanctions, et cetera, that would follow and the impact on the energy markets and how that would also flow through into inflation.
So supply chain was an issue.
Inflation was an issue.
And then third, so was the level of business investment, which is a chronic issue for Canada.
So all of these things and business investment.
As you know, Commissioner, business investment is very much something influenced by business confidence.
So you take together all of these factors, and then these disruptions come along, and they obviously contribute to the extent of the concern that we have because the Canadian economy, in our view at the time, was at a very, very fragile moment.
So that was one set of concerns and very significant concerns on our part and on the part of the government.
Relatedly, particularly to the issue of business investment, playing again in the background of all of this activity was pretty big changes in what was going on in trading patterns in the world.
Now, that sounds like an abstract idea, but it's actually not, because the Americans at the time With Build Back Better, with the rejigging of their own supply chains, of the tendency within the United States to want to have more resilient supply chains,
many of them anchored in the United States itself, that represented a very, very major challenge to Canada because of the degree of integration of our economy with the United States.
75% of our exports go into that market.
So as a result of that, and we were doing work with the Americans at the time, for instance, with respect to the treatment of electric vehicles, something that was critical to the future of the automotive industry in Canada, there was a tendency in the United States to want to treat that as an America-only issue.
And then again, these disruptions come along and raise issues.
In the eyes of the United States and in the eyes of the U.S. administration, raise issues around the reliability of Canada as a trading partner.
Significant issues to the point where issues, you know, I'm sure we'll end up discussing this, where issues that rose to the level of President Biden and our Prime Minister in bilateral conversations.
So these were very meaningful issues that arose in the Canada U.S. So that, too, very much entered into our thinking here that if these border disruptions that we were experiencing at the time,
if they were to continue for a period of time and became an even more significant threat to the American perception of Canada as a reliable trading partner, that that was something with very severe long-term consequences.
Not just for the Canadian automotive industry, but for a whole range of industries that we export into the United States, but the automotive industry was the centerpiece, at least at that time.
So that was the backdrop of why this was on our radar screen and how it became increasingly important on our radar screen going forward.
That was very helpful, including because it just cleared out about five pages of questions.
So now I don't feel so bad about having talks along.
No, that's exactly what I was hoping you would talk about.
And as a matter of fact, you said we might get into more detail about the specifics of how these events had an impact on your thinking about Canada's reputational concerns and trading concerns.
So if you have more to say about that, please elaborate.
No, I think for now, that's probably our...
I mean, I think that sets the scene of why this was an issue for us.
It had meaningful macroeconomic consequences for us in the near term, particularly given this point I've made about just the sensitivity, the specific moment we were at from an economic point of view.
I mean, this was a very, very delicate time coming out of COVID.
And I think in retrospect, we've seen all that now.
It was easy to shut down an economy, but very difficult to open it up again.
And we were in the process of opening up the economy, as every other country in the world was, pretty well at the same time.
So that was, you know, it was a very, very sensitive, delicate moment from our point of view.
And then this broader issue with the United States.
I mean, we were...
There was...
You know, the governor of Michigan was very active and very critical of what was happening.
There were multiple comments in the public media from members of Congress, from Michigan and other states.
There was concern within the American federal government, within the White House, about this issue, hence my reference to a conversation between the Prime Minister and President Biden about this.
I mean, this was...
You know, this was not...
How can I put this?
This was not a second-tier issue in the Canada-U.S.
relationship.
This was a first-tier issue.
And, you know, we were subsequently able to negotiate an arrangement with the Americans on electric vehicles.
But there was no doubt that these disruptions coming when they did in that process...
Brought with them the risk that we would not be able to get the North American treatment that we were eventually able to negotiate with the Americans with respect to electric vehicles.
And as I said, electric vehicles are the future of the automotive industry.
So if we had not succeeded in doing that, then the particular consequences of that for...
The central Canadian-based automotive industry would have been very, very serious.
So I think probably I'll leave it there.
Okay, thank you.
And on that note, which I think is a good segue, I will hand the podium over to Ms. Shuhebar, who will have some questions about the economic impacts that were of concern to the department and how that played out.
so Good morning.
Good to see you again.
For the record, I'm Dalia Shahibar.
I would like to say it's nice to see you and to be here again, but that would be playing fast and loose with the truth.
Well, here we are.
Here we are.
Here we are.
So I will be asking some questions about finance's work on assessing the economic impact of the blockade, and I think you've set the stage very well with sort of the less quantifiable impacts, and now we're going to be looking at more of the quantifiable ones.
And I'll be directing these primarily to Mr. Mendez, but I, of course, welcome other panel members' views.
So, Mr. Mendez, I understand that your division produced two formal economic analyses on February 10th and 22nd.
Is that right?
Yes.
I mean, the second one was an updated version of the first.
Okay.
But yes.
And were these shared with Minister Freeland?
I shared them with Mr. Sabia.
I'd have to ask him beyond that.
Mr. Sabia?
Yes.
Yes.
And do you know if she shared them with the incident response group or with her cabinet colleagues?
Now I need some guidance.
Cabinet confidences and stuff.
Yeah, it's fine.
Inputs into cabinet are fine.
Discussions at cabinet or not.
Yes, she did.
Thank you.
So I'll be getting to these analyses momentarily, but first, can you describe the kind of information that finance was receiving from Transport Canada and other departments?
Yeah, so I would say the principal source of information that we were receiving was from Transport Canada.
There was information on the amount and type of trade that was...
Disrupted or potentially disrupted.
And there was also Transport Canada's analysis on the impacts of the trade disruptions on economic activity.
So I'd like to pull that up, actually.
So that's PBCan50840.
This is the February 11th backgrounder I think you were referring to, Transport Canada.
And this was shared with finance, right?
It was.
If we go to page three, please.
It sets out three macroeconomic scenarios on the impact of the closure of the bridge.
And I appreciate that you didn't produce this, but can you walk us through those scenarios?
Well, as you said, I didn't produce the specific scenarios, and we relied specifically in our quantitative work on the first scenario.
The first scenario really focuses on a shutdown in the automotive sector.
Shutdown in the automotive sector.
The logic of that, I believe, is really the just-in-time nature of inventory management in the automotive sector.
So in the automotive sector, a short disruption to transportation, because it's so integrated across the Canada-US border, a short disruption to transportation, even if there's rerouting possible.
Can cause disruptions because oftentimes trucks are making multiple trips back and forth between plants.
And so just an added couple of hours can disrupt the timelines, cause drivers to time out in terms of the amount of time they can safely and legally drive.
So that's why I think they focus on the...
Can I interrupt for one quick second?
You mentioned just-in-time delivery.
Can you just explain that?
So it's a form of inventory management in which...
In the case of an auto plant, the various parts that they need to produce the automobiles that they're building at the plant come in literally just in time to be used in the production process.
So they don't store a stock of inventories to any great extent.
So really, even a 24-hour disruption to sort of the flow of these inputs can cause production to shut down or at least be reduced.
Okay, thank you.
So the first scenario was about the auto sector shutting down.
Yeah, and it allowed for other sectors, I think they assumed that they could largely mitigate the effects of the blockade and continue to operate fairly normally.
And I think that's where scenarios two and three come in?
Yeah, so scenarios two and three really focus on an escalation.
So scenario two expands to take account of other.
Other parts of the manufacturing sector beyond automobiles.
These sectors also rely a lot on trade across the Canada-US border.
They are somewhat less reliant.
They tend to have more inventories in stock, and so they can continue for somewhat longer than the...
Automobile sector before they face large shutdowns.
So I sort of think of that second scenario as, you know, had the blockades continued, you could start to move into that second scenario.
And then the third scenario is a case where really it becomes very difficult to reroute, difficult or impossible to reroute around the blockades.
And in that case, The shutdowns become more widespread across the economy.
Okay.
So there were some emails produced to us from your team that suggest they thought scenarios two and three were pretty unlikely.
Did you have a view on that at the time?
My recollection is that those emails were around February 14th.
And so that was after the situation at the Ambassador Bridge had been resolved.
And so I think that there was a clear direction at that point in terms of...
So I think that it was the additional information that they had at that point that allowed them to have that view of scenarios two and three.
And what about scenario one?
Did you think that was a likely scenario?
Scenario one, we used as the basis for our main approach in terms of thinking about the economic impact.
So, yes, I mean, I think scenario one, you know, didn't play out perhaps exactly as it was modeled.
But largely as it was modeled.
So I'd like to pull up the first analysis.
It's SSM CAN 50177.
And so you said that you used the background that we just looked at as a starting point, but I understand this analysis differed in some ways.
Can you expand on that?
So this is the February 10th version.
So in this version, we really focused on...
Highlighting, number one, the amount of trade that was at risk.
The fact that at the Ambassador Bridge alone, 30% of all road trade between Canada and the US crosses that bridge alone.
Every year, about 390 million goods crossing each day.
That, to us, was the thing that we wanted to focus on in terms of communicating just how much the risk was in terms of a prolonged disruption there.
A prolonged disruption there that causes a prolonged disruption in trade traffic, and therefore a significant impact on economic activity.
I believe we also highlighted, if you can scroll down...
Could we scroll down a bit further, please?
Yeah, so at the end of that last paragraph, we also highlight...
The reputational risk that several U.S. lawmakers had pointed to the situation to argue for Buy America policies and other protectionist policies, which would mean less reliance on buying goods from Canada and obviously would have an adverse impact on Canada even over the longer term.
But at this stage, you didn't attempt to quantify the impact yet, I believe.
We did not attempt to quantify the impact in this document.
And why is that?
Well, the situation was fluid.
So at this stage, you know, quantifications would have been what-if scenarios.
And I think that, you know, quantifying sort of what ultimately happened, which was a limited, more short-lived disruption, wasn't really going to convey the larger point.
And the larger point was really that the risk that, you know, if these If the blockade spread or if they persisted, that there would be a very significant impact on economic activity and that there was a building reputational impact.
Okay.
So I'd like to go to page two.
Could I just add something to that?
So in thinking about the quantitative impact, so we actually, as part of what we do on a regular basis, we monitor economic activity in the Canadian economy.
So that means we try to come up with a view of What economic activity is in the current quarter, so before Statistics Canada puts out official statistics and what it will be in the next quarter.
We rely on various high-frequency data to do that, but we're also looking at significant events that may have an impact.
And so part of our ultimate quantitative assessment of the GDP impact was to feed into that monitoring process.
But of course, that requires having a more concrete sense of how the situation is playing out than we had at this stage.
I see.
Thank you.
So on page two, the bullet that begins economic impacts.
Scroll down a little bit.
Yeah, there we go.
So about halfway into the paragraph, it says, in the near term, most manufacturers are likely to continue producing as they find alternative shipping routes and or through inventory management in anticipation of a resolution of the blockades.
Still, the macroeconomic impacts could quickly rise depending on how long the protests last and whether they spread further, with production eventually forced to slow.
So can you expand on how the possibility of rerouting and inventory management sort of factored into it?
Yeah, so the Ambassador Bridge was completely shut down at this point, but there were other bridges nearby through which traffic was being rerouted.
I mean, you can see that in the statistics in terms of the increases in traffic.
Other bridges, which I believe is later in this document, increases in traffic at other nearby bridges.
We say most manufacturers here, and that's because, as I was saying earlier, it's specifically within the set of manufacturers, it's specifically auto production that tends to carry very little in terms of inventory on hand, and so it's most at risk of being disrupted.
Very quickly.
So as you'll note in the last sentence of the paragraph you were referring to, we were already seeing some plants starting to see reduced production.
Can you comment on...
Can I?
Can I?
Oh, of course.
Is it okay if I...
Of course.
Yeah, go ahead.
So just to build on what Rhys just said, just to elaborate a little bit on Rhys's last sentence.
Given how...
Time sensitive the supply chains are in the automotive industry and how integrated production is.
I mean, I think it's, I think parts, a car being assembled, actually, the parts cross the border between Canada and the United States six different times in the process of producing a car.
So there's a high degree of integration here.
And you add to that the just-in-time delivery of Reese's point that Reese made.
So we were seeing at the time, I mean, this was having real work.
In Canada, on the Canadian side of the border, Ford, GM, Toyota, Stellantis, and Honda were either reducing shifts or in fact had shut down some plants because parts were no longer available.
And then on the U.S. side, they were experiencing the same thing because of that integration.
So Ford, GM, Stellantis, and Toyota in the United States.
We're, again, either shut down or has substantially reduced shifts, which obviously has a pretty significant impact on not just the companies, but on workers.
So that was actually, that was happening at the time.
I mean, this was not something that was going to happen.
These plants were being affected in real time.
It's helpful.
Thank you.
And the context, as Mr. Sabia alluded to earlier, the context here was that auto production had been adversely affected.
Prior to this, by shortages in semiconductors, principally.
And so we were coming into this after a period where we already hadn't been producing as many autos as we normally would have.
And that was having an obvious effect on the market.
Anyone who went to buy a car would have noticed that.
So if we go to page two, to the bullet that starts occupations of downtown cores.
Sorry, next page, I guess.
Yes, there we go.
So the occupations in certain cities, notably downtown Ottawa, are having important economic and social impacts on local residents and businesses.
If the disruptions remain contained and end soon, it is unlikely to have a significant impact on the wider economy, given the relatively small size of the impacted areas and likely diversion of activity to other parts of the cities.
Can you just slow down for the interpreters, please?
Absolutely.
Sorry.
So is it fair to say that during this period, finance was primarily focused on the border blockades rather than the protests in cities?
Or the economic impacts of those?
In terms of the economic impacts, we believe the border blockades pose the greater risk.
I guess they would affect the whole economy, whereas cities were more localized.
Yeah, so the impacts of the border blockade, because the affected sectors have linkages to the greater linkages to the rest of the economy.
Did have the potential to have much broader effects.
Okay, so the next bullet, implications for monitoring.
It's a big one, but let's just start it.
So up to now, the blockades had mainly delayed trade activities of goods valued at around $500 million per day and increased shipping costs.
This represents the value of goods being delayed and does not translate into direct permanent loss.
If the disruptions were to end now, most losses could be recouped, leaving little impact on economic activity in the first quarter of 2022.
So just pausing there, can you expand on the idea that the delays would not translate into direct permanent loss?
Yeah, so there's a distinction here between short delays and a short disruption and a longer disruption.
And the reason is, so if you imagine an auto plant, for instance, They lose a short period of production.
It may be feasible to make that up to a significant extent in subsequent weeks.
But there's a limit to how much production can be made up because, you know, there's only 24 hours in a day.
People can only work so much.
You can only work the plant for 24 hours a day at most.
And, you know, even that, there are limits because there's tight downtime needed for maintenance, etc.
So, a short disruption to production, it's possible to make that up.
It's not free because, you know, there's a reason that the plants and the workers weren't working those extra hours to begin with.
Most likely, you know, there's time needed to...
To maintain the plant, for people to rest, etc.
But it is possible with a short enough disruption to make up at least some of the lost production.
With a longer disruption, as the amount of lost production accumulates, it just becomes more and more difficult to actually feasibly make that up, given the constraints in terms of how much you can actually increase.
Production once the disruption ends.
Can I just, again, I just want to draw this out because I think in the subsequent discussion, this point I think is important.
And it's got to do with a short disruption is one thing.
As Risa said, a longer term one is a completely different story.
And that is what led us within the department.
To be so focused on this question about finding measures that could be delivered with speed, because the objective was to try to keep the disruptions to as short a period of time as possible for two reasons.
First, if shorter, based on Reese's analysis, then the macroeconomic effects of them are...
Other things being equal are more likely to be relatively more modest.
But second, and really importantly, if they were to continue, then on this other point that I made earlier about the impact on the Canada-US trading relationship and the longer-term consequences of the Americans reassessing Canada's reliability as a trading partner, that if we could keep things short, the damage to that overall relationship It's something that we would probably be able to manage our way through.
If, on the other hand, the disruptions continued for a period of time, then a core concern we had was that that could have, at a time when the Americans were reassessing their trading relationships with the world and certainly with us, that that could have a very significant and durable negative impact on Canada's economic prospects.
So this issue about...
Trying to move quickly to keep the disruptions to a relatively finite and short period of time.
This is something that was just right at the core of all of our thinking within the department.
That's very helpful.
And I think my colleague will be exploring a bit more about what measures you took and why, but that's very good context.
So we're going to be getting to some technical points now.
And so I think it would be helpful to clarify some concepts for those of us who are not economists, including myself.
So am I right that at a basic level, GDP is the value of goods and services produced by a country in a given period of time?
Yes.
Yes.
And it's often considered in different quarters of the year.
Yes.
Okay.
And so can you explain the difference between the level of GDP and the growth of GDP?
Yeah.
So the level of GDP is essentially what you just described, the flow value of the goods and services produced in an economy during a period of time.
The growth rate is the change in that level between two different periods.
Okay.
Thank you.
I'd like to pull up SSM CAN 403771.
I should say the growth rate is the change in the level between two different periods expressed as a percentage.
Okay, thank you.
And we'll see that this is an email from February 10th from Julie Turcutt, who I believe is the Director General of Economic Analysis and Forecasting.
And so at the top here, she says...
FYI, Bloomberg is suggesting a 0.1 PP, which is percentage points, I think, direct drag on annualized GDP growth for each week of major slowdowns seems large to me, and an extra 0.2 to 0.3 percentage points in direct effects.
Of course, too cute to be really backed by analysis and most likely overstated to make up for nice media attention.
So when they say a 0.1 percentage points direct drag on annualized GDP growth, can you explain that in simple terms for us?
Yeah, so it's basically reducing the rate of growth by 0.1 percentage point in this case is what they're saying.
I don't know exactly what they mean by drag because my recollection is that The Bloomberg article in question doesn't specifically lay out the methodology in detail, but I would suspect it means the impact on these sectors that are directly affected by the trade disruptions.
And maybe that's a contrast to the 0.2 to 0.3 in indirect effects?
Yeah, and so again, I don't know what that means.
That language often indirect is often used to refer to The impact of a disruption in one sector as it spreads through the economy onto other sectors.
So it seems like Mr. Kutch is a little bit skeptical about these conclusions.
Like, did you have a view at the time?
I don't recall having a specific view at the time on the Bloomberg estimates.
I'll say part of...
What you're seeing here is just in the normal course of assessing all of the incoming information, we do try to play a bit of a challenge function.
And I think in trying to take a skeptical view of things in order to assess the validity of a given number.
And over time, as more information comes in, that can...
Can change.
I think the 0.1, that ended up being in the same vicinity as the sorts of numbers we came up with.
If you add up the 0.1 plus the 0.2 to 0.3 and get 0.3 to 0.4, that ends up being a larger number than what we came up with.
But of course, we hadn't done that analysis at this point.
So at this point, they were just trying to sort of Have a discussion around what they thought of these numbers.
Fair enough.
So I'd like to pull up SSM CAN 6-0's 95. And these are minutes from the February 13th meeting of the Incident Response Group, which I believe, Mr. Sabia, you were attending.
Is that right?
No.
If we can go to page six once you have it up.
I think this is the only unredacted sentence.
The Minister highlighted ongoing economic losses of 0.1% to 0.2% of GDP for every week the blockades continue.
So this is Minister Freeland?
Yes.
Yes.
And as you just said, at this stage, you had not provided a figure like this to Mr. Freeland.
Correct.
That's correct.
Yes.
And she actually told us in the interview she had got this from the Bloomberg article.
And when she speaks about ongoing losses of GDP every week, is it fair to say it's not clear whether she's talking about level or growth?
Well, if it's from the Bloomberg article, they were referring to growth.
From the minutes, you're right.
It's ambiguous.
And that's something...
Reese may want to elaborate on this, but the way the Bloomberg piece got done, it established a set of numbers, and it conveyed that if it went on for X number of weeks, you would just add up that number, say 0.1 or 0.2 for each week.
And I think that's what the minister, given that this is based on Bloomberg, that that's what the minister is commenting on here.
Our thinking, and eventually in a further discussion with the minister, was that actually, while Bloomberg may have got some things right, what we think that they did not get right was that the impact grows over time.
So for every unit of time, you get more impact than just if you're able...
To contain the disruptions to whatever, a week, two weeks, whatever, but a very short period of time, that's one thing.
But as it goes on and the indirect effects spill over into other sectors, you get more disruption of supply chains, then that number will tend to grow over time as you go through it week by week.
So again, coming back to this point I made earlier, sort of time is everything here.
If you can contain it, it's one thing.
If you can't and it gets bigger and bigger, then you're facing a bigger and bigger economic problem.
As we were discussing earlier, inventories plays a key part in this, that the auto sector got hit first because it tends to operate with a just-in-time delivery model.
Other manufacturing sectors would have been hit subsequently as they started to draw down their inventories.
You know, sectors like food and beverage that rely on perishable inputs that cross the border would have started to be more affected also.
So I think that the economic impact would spread the longer it lasted, and so the number wouldn't be the same for each week it would grow.
Okay, that's helpful.
Can we pull up SSM CAN four zeros 1980?
And so this is an email that you sent Mr. Mendez to Mr. Sabia on February 22nd.
And so if you scroll down a little bit.
Yeah.
Michael, as requested, here is our best current estimate of the impact of the blockades.
With the current information, we estimate that the border blockades would reduce the level of GDP in 2022 quarter one by 0.03 to 0.05 percent.
In terms of annualized growth, this would knock off about 0.1 to 0.2 percentage points in the first quarter.
Much of the impact on the level of GDP will likely be recouped in the second quarter as production catches up.
And so when you say there would be a reduction in the level in the first quarter by 0.3 to 0.05 percent, 0.03, excuse me.
So that means the economy would have produced 0.03 to 0.05% less than expected?
Is that what it means?
Less than it otherwise would have in the absence of the disruptions.
Okay.
And then the part about annualized growth, can you just explain that one?
The reduction in 0.1 to 0.2 percentage points?
Yeah.
So that is just saying that the change, the percentage change in GDP between the first quarter of 2022 and the fourth quarter of 2021 would be reduced by...
0.1 to 0.2 percentage points.
And can you elaborate on this sentence about how the impact on the level of GDP would likely be recouped in the second quarter?
Yeah, so again, we had a discussion earlier around, you know, a short disruption makes it feasible to catch up on that lost production subsequently.
And so given, you know, this email was February 22nd, by this point, we knew the duration of the disruptions.
In the event that they were limited in duration.
And so at this point, we believe that it was possible for the lost production to be made up by subsequently people working overtime, factories running overtime.
As I said earlier, that's not free because there's a reason you don't run your factory overtime on a normal basis because you need downtime for maintenance.
Down time for people to actually rest and running over time can lead to productivity issues and stuff.
But overall, we believed it was possible given the limited time of the disruption.
And so if the level could possibly be recouped, does that also mean that the effects on annual growth could be offset or do they not operate that way?
It may not completely offset.
You mean in terms of annual growth quarter to quarter?
So basically what this means is that you'd see growth in the second quarter being a bit stronger than it otherwise would have as you see the catch up in production.
And so the next bullets we've sort of covered already.
You talk about the supply chains being under stress already, and then the major impact of the auto disruption.
If I could, when I look at that, and indeed, when that analysis surfaced, I hope you'll understand what I mean when I say this, but that analysis says to me, Success.
Success in that the disruptions, at least at that point, it seemed as though we had succeeded, the government had succeeded in keeping those disruptions within a relatively short period of time.
So the fact that almost ex post, Reese's and his folks...
Could do that analysis and say, well, we pretty much know what the duration is.
Therefore, we have a pretty good idea of this.
That said to us that.
Well, as I said, that's pretty much success, given the disruptions that we faced earlier on in the decisions that needed to be made when the duration of the disruption was still an open question.
The fact that we were able to do this ex post said to us, you know, in a way.
Uh, success or mission accomplished.
Right.
Um, so it could have been way worse, but thankfully it wasn't basically.
Okay.
So the last two bullets, they say the ultimate impact will, among other things, depend on the ability of affected businesses to increase production beyond normal levels to catch up on lost output in the coming weeks.
And these economic impacts could quickly escalate in the event that blockades were to reemerge and if other crossings had become unavailable.
So I think we've sort of covered these points, but anything you want to add about those?
Yeah, I think we've covered the first point in terms of The length of the disruption is really what drives the ability of businesses to catch up, in part.
On the last bullet, I think that just speaks to the point Michael just made, that it was really the fact that the blockades had been ended within a limited time is what prevented the economic impact from escalating much further.
I'd like to pull up SSM CAN 407571.
And this is the second analysis from February 22nd.
And I don't propose to walk through in the same way because I think we've covered a lot of it.
And would you agree that a lot of it expands on your email that we just saw?
Yes.
Yes.
But I will look at a few things.
So in the big economic impacts paragraph on page one, there's a fair bit of detail about the delays in trade and effects on auto production.
The last two sentences say, though the bridge has reopened, it will likely take time to return to the pre-disruption pace of trade and production.
In addition, the fallout could be even greater if producers choose to source their supply chains elsewhere in the longer term for fear of these disruptions reoccurring.
And so this idea that producers might source their supply chains elsewhere, was this something that finance was hearing?
Well, look, I think that's just another way.
Reese may want to elaborate on the point because there's an analytical point here.
But, I mean, that's consistent with the point I made earlier about the strength of the reaction that was being reported in the public media from U.S. lawmakers.
At a time when they were attempting to pass legislation that could have a pretty significant impact on the reengineering of their supply chains to repatriate.
I mean, you'll recall, I mean, this issue is still very much, you know, in front of us today, that as we move to a different structure of global trade than we have had for the last 25 or 30, 40 years.
All of these issues about sourcing and structure of supply chains, these are all, they've all become open questions.
So, you know, the concern that we had here was, again, this is in the world of confidence and perception.
If American companies or the American government began to think that they could not count on us as a reliable source of supply, then they probably would shift production.
And if they were to shift production, that would have a very significant impact on both the level of GDP and the growth rate of GDP.
Yeah, and I guess I would say that this sentence is in part trying to convey the longer-term uncertainty.
But, you know, the limited duration.
The fact that the blockades were ended within a limited duration, I think, helped to avert some of the near-term risks.
Michael talked about the negotiations with the U.S. over electric vehicles.
That is clear that it was helpful in the near term.
What we don't know is five years from now, when an automaker has to decide, Where to put their new plant?
Will this be a consideration?
Hopefully, the fact that the disruptions were relatively short-lived mitigates that issue.
But that sentence was just a reminder that there is that longer-term uncertainty.
Okay.
If we go to page five, please, to the second table.
It's called Economic Impact of Border Blockades.
And so the first column says value of goods per day prevented of free flow, $511 million per day at the peak.
And the second column says estimated economic cost per day between $28 million and $56 million per day at the peak.
Can you explain the two columns and how they interact?
Yeah.
So the first column is the sum of trade at the Ambassador Bridge.
And at the points of entry at Emerson and Cootes that were blockaded.
The second column is our estimate of the economic impact, so the impact on GDP per day during the week where we think the impacts peaked.
So that was, I guess, the week of February 6th or 7th, the week during which the Ambassador Bridge was Blocked.
So that second column, the way we come up with that is we take as a starting point Transport Canada's scenario one, which we discussed earlier, which estimated an impact from the Ambassador Bridge disruption at $45 million a day.
We then make assumptions.
To get effects on, you know, get estimates of the impact stemming from the disruptions at the points of entry at Coutts and Emerson.
And that gets us from the 45 to the 56 million dollars a day.
The 28 million reflects the, you know, there was uncertainty about the overall impact.
You know, you saw in discussions earlier, in one of the emails I think you put up earlier, there was a discussion around how should we think about the $45 million disruption that Transport Canada had?
Should we think of it as an upper bound?
So the 28 reflects that uncertainty.
So we wanted to be cautious in terms of the economic impacts that we estimated.
It's simply half of the $56 million to reflect that there's a range of uncertainty about what the true impact is.
I'd like to pull up SSM CAN 403807.
And so this is a draft of the Section 58 explanation, so the formal explanation the government gave for the Emergencies Act.
And I can pull up an email if you'd like, but do you recall it being sent to you, this draft, Mr. Mendez, on February 16th?
I remember a draft being sent to me.
I don't remember the precise date.
Okay.
If we go to page six, please.
The second full paragraph, it says, the economic impact to date is estimated at approximately 0.1% of Canada's GDP per week.
However, the impact on important trade corridors and the risk to the reputation of Canada As a stable, predictable, and reliable location for investment may be jeopardized if disruptions continue.
And so I can pull it up if you like, but do you recall writing an email saying that you had asked for this paragraph to be removed?
I had asked for the reference to the GDP impact to be removed.
And why did you ask for that?
So a few reasons.
One is that we hadn't completed our GDP impact estimates.
Because in part we were still evaluating the situation, it was evolving.
I did not think that the, as Michael discussed earlier, the per week characterization, I thought missed the point that the GDP impact would rise with each subsequent week.
It wouldn't be the same every week, the longer that the effects went on.
And I think most importantly, The real issues here were the risk of a more prolonged or more widespread disruption to cross-border trade that would have led to a much larger GDP impact and the reputational risk that affected our reputation as a reliable trading partner and as a good destination for investment.
I just have one last document.
So, it's SSM CAN 40498.
And so this is a memo from April 6 that was prepared by the Privy Council Office for the Prime Minister.
We can see at the top it's called Merchandise Trade in February 2022.
If we go down to page two, just the first bullet under PCO Comment.
February data confirmed that the border crossing blockades in February had limited impact on the flow of goods, as lower traffic at the impacted border crossings was partly offset by increased trade activity at other crossings.
This suggests that border protests did not significantly disrupt the Canadian economic activity in February, in line with the advanced real GDP estimate, which anticipates a growth of 0.8%.
Do you agree with the conclusion that there wasn't a significant impact on the economy?
So I think the last estimate we did of this was the 0.1 to 0.2% impact on the first quarter, quarter over quarter growth.
And so we haven't revisited that.
That said, I think that it's fair to say that the economic impact was limited, but it was limited because the duration of the blockades was limited.
So I think, again, it comes back to the fact that because the duration was limited, there was some ability to ramp up production after the blockades had ended and trade had resumed.
Because the blockades weren't more widespread than affecting bridges that were being used to reroute some of the traffic that would have gone over the Ambassador Bridge in particular.
That helped to limit the impact.
But had the blockades been more widespread or longer lasting, the impact would have been much bigger.
I would also just add that it's not possible to say that they didn't have any impact because we know that many auto plants had either shut down or reduced hours, reduced shifts.
So there was clearly an impact in real time.
That information is...
It's clear in the public record.
When we look at the data, so data collected for instance by Wards, which is a company that collects data on the automotive industry among other things, if you compare their forecast for what February production would have been when they've made the forecast at the beginning of February versus what it actually turned out to be.
It ended up being close to 10% below what their initial forecast is.
And I think it's reasonable to assume that at least part of that was due to the blockades, given that we know that there were shutdowns and reduced hours at many plants.
Just as my last question, I understand that finance didn't do sort of an after-the-fact assessment.
And can you explain why, of the impact of GDP?
Yeah.
So, I mean, you know, we often do...
Assessments of things, of events that are likely to have an economic impact in real time, because as I was mentioning earlier, we are trying to monitor the evolution of the economy.
You know, we try to come up with an estimate for GDP in the current quarter and the next on an ongoing basis.
So we're often doing real-time assessments, whether it's, you know, a flood or other weather event or something like the blockades.
We generally don't do Ex-post assessments of the impacts of events like this.
The reason is it's very difficult to actually identify the impact ex-post.
So, you know, you think about all of the February data that we're looking at.
So whether it's the trade data or GDP or labor force data, there were confounding factors affecting things.
For instance, there was an Omicron wave in January of this year, which would have adversely affected economic activity and therefore would have affected the growth rate of economic activity between January and February, would have affected hours worked.
And so there was also, for instance, there were auto production issues in January.
Unrelated to the blockades, but related to shortages of semiconductors and other inputs, which caused auto production in January to be adversely affected.
So, you know, there would be normally some ramp up in February to try to make up for that if the parts started to come in.
That sort of confounds the ability to see the full effect of the...
The blockades on auto production.
So there are these various confounding factors that are always in play because there are always multiple things going on in the economy that make it difficult to provide an ex post estimate of the impact with any degree of confidence.
Basically, it's hard to isolate the impact of one single.
Precisely.
So those are all my questions.
I'll turn it back to Mr. Cameron.
Thank you.
Thank you.
Thank you.
Thank you.
Well, the good news for you, Mr. Mendez, is you can probably get through the rest of this without answering any more questions.
Feel free to if you have input, but you've had your work out for this morning.
Where we'd like to go now is Approach that the department took as the convoy was becoming an issue and your department was being approached to consider possible options from the Department of Finance's point of view for dealing with the issues that the government was facing with respect to the convoy.
And let me ask you to just begin by describing when this approach was made to you.
How did The Department of Finance view the tools that it could add to the government's kit for dealing with this situation.
Sure, let me start and then, Isabel, you may want to add.
So, look, as the disruptions on the one hand continue to materialize and in some cases intensify, and the disruptions in Ottawa There was a general sense across the government and,
you know, an interest that was expressed to have every department trying to think about are there ways in which we can develop ideas that would help bring to an end, in a good way, this very difficult situation.
So there was a general Interest and in developing ideas, which obviously included us.
But beyond that, the sort of general interest, there were a couple of other things in our minds motivating our work to try to find things that could contribute to a solution.
On the one hand, I won't belabor this again, because, you know, with the previous conversation and recent comments.
I think the extent of our concern with respect to the economic issues is pretty straightforward, pretty clear.
And this intense focus we had on, are there things that can help end this quickly?
Because as Rhys and I have tried to explain, duration is everything here in terms of its disruptive impact on the Canadian economy.
So quite a side, or in addition to the general interest in...
Due to various departments, can they develop ideas that can be helpful here?
We wanted to, given our responsibilities for the Canadian economy, we wanted to find ways, and that was a significant motivator.
The other one was, we are also, given our responsibilities for the financial sector, we also take seriously our responsibility to ensure the integrity of Canada's financial system.
And Canada's financial system being used for these kinds of purposes is not consistent, in our view, with maintaining the integrity of the financial system.
So it was both our response to a general request for ideas, but within the department, it was, what can we do to shorten the duration of these disruptions?
Given their economic consequences.
And then finally, this concern that we take very seriously about the integrity of Canada's financial system and that we safeguard that integrity all of the time.
So those three factors led us to start some work on what can we do, given the legislation that we're responsible for.
So we began thinking about Are there ways in which we could use the Bank Act or other pieces of legislation that really centered pretty heavily on the Bank Act?
Also, the money laundering and terrorist...
PCMLF.
The acronym's too long.
Proceeds of Money Laundering and Terrorist Financing Act.
She's got it.
Those two pieces of legislation.
So we started thinking about, okay, well, is there something constructive that could be done through Fintrac, which is the agency responsible for proceeds of crime, money laundering, and terrorist financing or terrorist activity?
Could we do something there?
And could we do something using the minister's authority for the Bank Act?
And then to make a long story short, It was widely publicized, and it was very public, that crowdsourcing platforms were being used as a source of financing for these activities, similarly payment processors, and neither of those were within the regulatory perimeter of FinTrack.
So one thought process was, well, is there something that we can do around that?
And then the second...
With respect to the Bank Act, is there some way that we can use the Bank Act to give banks the capability to freeze bank accounts if, in their judgment, those bank accounts are being used for an inappropriate purpose?
Now, again, just a high-level summary here.
There are a series of issues with that.
One, we couldn't do anything outside of federal jurisdiction because the Bank Act only applies to federally regulated financial institutions.
But there's a whole raft of financial institutions in Canada that are not federally regulated, particularly So, because we couldn't do anything outside of federal jurisdiction, that really made pretty academic whether we could or could not do anything in federal jurisdiction because money is fungible and it can just move from one institution to another.
So, if we couldn't do something that was more comprehensive, that was a pretty significant limitation on what can be accomplished.
There was also A fairness issue there.
I'll give you an example.
In Quebec, the Banque Nationale, that's a federally regulated institution, but Desjardins is not.
And Desjardins, anyone who's lived in Quebec knows that Desjardins and Banque Nationale compete pretty intensively between the two organizations.
So to treat one one way and the other another way, that's just one example, but that seemed to us to be a pretty big problem.
So that was one piece.
The second piece, come back to something earlier that I said, was whatever we could do, we wanted to do quickly, because doing it quickly meant shortening duration, and shortening duration meant avoiding the worst economic consequences that we were concerned about.
But of course, pretty much anything that we could do would require a legislative change.
And legislative changes, by their nature, take an extended period of time.
So if our thinking process was, how do we manage duration here of the disruptions?
Anytime we bumped into something that required a legislative change is something that was, by its nature, less attractive because we couldn't do it quickly.
And by not being able to do it quickly, it didn't really deliver what we needed, which was relatively speedy action to shorten the duration of these disruptions.
Okay, well, for the reasons you just mentioned, we'll leapfrog your initial interest in seeing if there was something you could do under either the proceeds of crime legislation or the Bank Act.
But the memo that you did for your minister on that point happens to capture some thoughts that I want to use as we move ahead into the legislation that was actually used.
So if I could ask the clerk to call up SSM, can.
4-0 is 3764.
And this is a memorandum from you, Mr. Sabia, to the Deputy Prime Minister and Minister of Finance, Minister Freeland.
And because you seem to have some law against dating documents in the federal government, I've had to figure out that this is a February 9th memo.
Does that sound about right?
Yeah, that's about right.
Maybe we're eight or nine, yes.
That's about right.
If it makes you feel any better, it drives me crazy too.
And this described, if the clerk could just scroll down, it basically describes exactly what you just encapsulated in your earlier comments.
Mr. Sabia, keep scrolling, please.
There we have the initial point, the possibility of looking at this under the proceeds of crime legislation, and then there's a page of that, and if you get up to the top of page three, where there are some redactions, you see...
Now, these are options under the Bank Act, as you'll remember from the time at which this particular memorandum was developed, but they ended up being brought forward.
Into the legislation.
And by the way, please feel free to chime in if this is your territory.
But in terms of what we'll call freezing accounts, I think there's a more cumbersome way of describing it, refusing to have dealings with or transactions with the customer, et cetera, et cetera.
But I think you'll understand what I mean when I talk about freezing accounts.
The two options here, if I can describe them compactly, the first one is that the government creates some sort of authority which simply directs banks to freeze accounts without the bank having any discretion in the matter.
Is that right?
That is correct.
And then the second option is one in which the bank is...
The person is identified, but the bank then exercises its discretion as to whether or not that person is engaging in activity that should result in their bank accounts being frozen.
Is that fair?
That's fair.
had to review their business relationship to see whether any of the funds were used in a manner that was concerning all right And in these options, of course, under the Bank Act, these would not apply to, you know, provinces nor territories.
Right.
And so, as Deputy Minister Sabia said, the option that had more attraction to you because it was much faster, you didn't need legislation, and because it was national and could cover both categories of institutions.
And I think, just to complete that point, Mr. Sabia, you would add the ability to capture the insurance industry if you were able to have a regime that covered the whole country.
Correct.
But at the time, certainly when we're looking at these options, the situation was evolving.
So we started from a situation when we're monitoring these activities where there seems to be...
peaceful manifestation ongoing and certainly this situation degenerated so when we started looking at this where we're looking at options uh under the bank act right
At the time you were developing these options, and this is February 9th, things were moving quickly at this stage and transitioned into consideration of the possibility of incorporating similar authorities in emergency legislation.
I understand you were having consultations with the financial services industry as to how they would be able to work with these if you did enact them, and if one of you could describe that for the Commissioner.
Yeah, that...
That started...
I don't recall the exact dates, but sometime in the week of this memo, I think a little bit earlier, I had some...
I mean, as the principal regulator, OSFI and...
We have a lot of contact with the Canadian banks, Canadian financial institutions in general.
So I am, as is Isabelle and her team, we are in regular contact with Canadian financial institutions pretty much of all kinds.
A, because of our role in that sector, and B, because they're a very good way of listening.
And understanding more about what's going on in the Canadian economy at any one point.
So I had some conversations, particularly with bank CEOs, during that week to get their sense of what was happening and reaction to these disruptions.
And in those conversations, we were talking about that, their general take on On these events and what they thought the government should or shouldn't be doing about it.
And then, second, general conversations around what could be done.
In those early days, I did not raise the specifics of these options, which would have been inappropriate at the time.
We were not at that point.
We had not had conversation with our minister about it.
So these specifics in those early conversations were not really on the table.
Then a little bit later, I think toward the end of that week, I started having conversations, collective conversations with all of the bank CEOs.
The minister eventually joined me in some of those conversations.
Now, can you describe the feedback you got from those institutions, in particular their reaction to how they would administer a regime in which they were being asked to freeze accounts?
Yeah, well, need to be careful here.
Prior to the possibility or likelihood that the government would invoke the Emergencies Act, that was a very important dividing line here.
So prior to that, in the week that we're talking about here, my conversations there would have been much more general and much more focused on You know, what are they hearing from companies?
What are they hearing from investors?
How do they gauge the situation?
It was much more our trying to understand by talking to other people whether or not our perception of the situation was aligned with how other people were perceiving it.
I would say there was very much alignment around the concerns that Reese and I have talked about earlier and what we were hearing.
From institutions that basically span the Canadian economy and are constantly in touch with clients, and their clients are businesses and individuals across the Canadian economy, so they're good listening posts.
So that was prior to the possibility of the Emergencies Act, because as per this memo, as you can see, the conclusions that we were coming up to...
They were arriving at were conclusions that actually there wasn't really, other than through FinTrack in that side, there really wasn't a lot that we could do in the near term without passing legislation, which, as I said, would take a considerable period of time.
Now, as the possibility or likelihood of the Emergencies Act being invoked, then that That changed the nature of those conversations.
And through, I think, that weekend, I forget, the dates would have been the sort of 12th, 13th or something.
You have to double-check the dates, but 11th, 12th, 13th, somewhere in there.
We then...
We began to have conversations about in the event that the government were to decide to move down this path, because it hadn't been decided yet, how could this be done?
And I would say that the reaction that we got to those initial conversations It was pretty much consistent with what I had heard in the earlier conversations, which is to shorten what were long conversations, that this is a serious issue and a threat to Canada's economy.
What can we do to help?
So there was an openness on the part of the bank CEOs to working with us to try to find solutions that would bring a peaceful end to What was a difficult circumstance?
So in those conversations, we did talk about, you know, how could this work?
What would you do?
What would be feasible for you?
Because we wanted to learn as much as we could about the actual operation of this from the people who actually operate in the day-to-day financial system of the country.
So that was the nature of those conversations.
As the weekend and time progressed and it became more apparent of the possibility that the government would move in this direction, then Minister Freeland joined me for one or two of those calls, where at that point we were saying, okay, well, if we're going to go down this path, our expectation would be for you to be able to do A, B, and C. Are those feasible things?
How would you do that?
And in A, B, and C, we'll just talk about A and B. And the first is you're saying to the banks, we can either give you a list of people whose bank accounts need to be frozen and then you freeze them.
That's option one.
Or you, the manager of the bank, can watch the news and read the paper and look at your customers and try to figure which ones of them are engaged in The way I've described it, Mr. Sabia, I think you're probably going to foresee what the reaction was of the financial industry as to which of those two options they would have found easier to administer.
sir yeah i think the less um I think statement of the obvious, the less discretion that they had, or in other words, the less onus you're putting on the financial institutions, you know, from their perspective, the easier for them.
Right.
And again, for one of you, perhaps now we're over to Majak again.
As I read the...
Emergency Economic Measures Order, it ended up being a hybrid of those two options, one and two.
Can you describe that for us?
Yes, it was.
So basically under the Emergencies Act, certainly financial institution had an obligation to review on an ongoing basis their relationship with their clients to ensure that they were not...
Using property to further the illegal activities that were ongoing.
And certainly in doing so, if they found out that they did have any of this property, they would have to suspend the services they provide, namely to freeze those accounts.
Right.
So in trying to come to the knowledge and conclusion as to whether you had a business relationship of such nature, they could do two things.
The first...
They could, on their own, on an ongoing basis using their algorithm or processes that they have, identify suspicious transactions.
Or, as we specified in the legislation, obtain information from enforcement officers.
It could be from federal or provincial.
So we provided for information to be shared by the federal.
Or provincial or territorial governments with the financial institution to help.
What occurred in the end was that the RCMP shared information with the financial institutions, financial service providers to help them identify those people and vet the information they received.
And so you trailed off at the very end?
And vet the information they received.
So the obligation was on the financial institution to determine In the end, whether or not they were going to freeze bank accounts.
Now, I want to chase down exactly those last words you used, including the word vet.
So the ideas of the regulation as you conceived it, and as ultimately it was enacted, was that the banks would receive some information from police authorities, as you say it turned out to be the RCMP, and then they would vet that information.
And exercise some discretion as to whether or not they should take measures under the order to, as we're saying, compactly freeze the accounts.
Is that right?
Yes, I would say so.
I mean, if you received information from the RCMP, the financial institution, financial payment service providers would have to review the information they receive and ensure that the people that are named are actually the people that have accounts with.
That financial institution.
So that's number one.
Certainly, they had to ensure they had the right people.
But also on their own, as I mentioned before, they could review the information they have, use the systems they have, their algorithm to detect suspicious transaction, which they did.
And on their own, they did freeze bank accounts without information received from the RCMP.
Okay.
So they could take...
Option number two, if they were able to, with, as you described, their algorithms, if they could detect suspicious activity, they could come to their own conclusion and freeze an account.
But to go back up to option number one, which is the one that I was concentrating on, if the RCMP gave them information, you described them as vetting that information and deciding whether they should freeze the account.
What I mean by vetting is being...
If you read the language of the legislation, the financial service providers are responsible for taking the action, ultimately.
It's their responsibility under the Act.
So certainly, they received information from the RCMP with respect to persons, entities involved in illegal activities.
They looked at the information and had to certainly confirm.
I don't know what their internal processes were, but I certainly know that they reviewed the information to ensure that the people...
That, you know, with whom they had business dealings were the people that were signaled or identified by the RCMP.
but I'm sure that the financial service providers could tell you exactly how they went about that.
If we could call up Mr. Clerk PB CAN 50781.
Thank you.
I don't know if any of you would recognize this.
Denis Beaudoin is an officer with the RCMP, and he filed this affidavit in the context of some of the litigation that's going on in connection with the invocation of the Act.
And if you could scroll down...
Sorry, they filed this with respect to...
Sorry, if it's important to you, I'll just explain.
This is an affidavit that was filed in court in the context of litigation that was initiated in challenging the invocation of the Act.
So the RCMP is explaining what they did with the regulations that we're talking about here.
The regulations or the order?
Sorry?
The regulations or the order?
Sorry, the order, yes.
And if you could scroll down, Mr. Clerk.
It's just through the body of the...
Paragraphs 8 and 9 of this affidavit, he's describing your regulations and then as not specifying a procedure through which the financial services providers would identify individuals.
And then in paragraph 9, Can you scroll down a bit further?
Thank you.
He says, "In practice, the police provided financial service providers with information about particular individuals or entities which the financial service providers could use in conjunction with other information at their disposal to make their own determinations about whether they needed to take any steps to comply." With the order, do you see that?
Yes, and that's what I mean by a vetting.
Thank you.
Thank you.
Now, do you recall that in your...
your own institutional report and Mr...
I wish we could keep two things up at once.
Mr. Clerk, I might ask you to go back and forth, but in any event, if you could call up DOJ.IR8030.
uh go to to uh page 11 of that document And then a little scroll down just a bit further.
Thank you.
That's perfect.
The paragraph that begins the Department of Finance did not have any information.
That's not surprising.
If you look at the second sentence, the Department of Finance played no role in the process through which financial institutions identified the accounts that they froze.
The RCMP has stated that at no time did it provide a list of donors to financial institutions.
The Department understands that the RCMP provided a list that included identities of individuals who were influencers in the illegal protest in Ottawa.
And owners and /or drivers of vehicles who did not want to leave the site.
At no time was that list provided to the Department.
Now, what we have here then is the Department of Finance, and this is your regulation, Nizhak, so you probably had something to do with the drafting of this part of your institutional report.
Is that correct?
Yes, it was our emergencies measure order.
Yes.
We did not take part in drafting the regulations.
Fair enough.
Did the emergency economic measures order, in effect, get drafted by you and your department?
The policy was developed by the Department of Finance.
My branch and the drafting was done by the Department of Justice, yes.
Fair enough, okay.
And the point here is that you take no responsibility for, that is, the Department of Finance takes no responsibility for which accounts got frozen.
That is, you just drafted the regime that allowed that.
That freezing of accounts to take place.
Is that right?
Well, you have to go back in time, certainly.
When we were working and that there was a decision to...
We found out that there's a possibility that the Emergency Act would be enacted.
We started looking at policies and options as to how we could implement and take action fairly rapidly.
So we did.
Obviously, develop a policy that would enable for a number of federal, provincial players, like the enforcement, the RCMP could share information with the financial service providers.
So that was something that was important to help financial service providers to identify people that could be So that was number one.
And number two, we were thinking that knowing that on their own, they could also detect fraudulent activity or suspicious activity, that they could do that as well.
But as far as sharing the information, the Department of Finance does not receive information from the RCMP that was solely between the RCMP and the financial service providers.
And it was up to the financial service providers.
To make the determination as to whether or not to freeze bank accounts based on the information they had.
So it could be their own information or a mixture of information received using their own risk-based analysis to make a determination as to whether they would freeze.
Okay.
Now, Mr. Clerk, as I said, we are going to hop back, if we could, to 781.
Same section.
So the RCMP gets, I'm going to call it a hot potato, but gets tossed this hot potato of these regs to freeze bank accounts.
And it's about to toss the potato over to the banks.
And with the caveat that Officer, or I believe it's Superintendent Baudouin, makes that...
I'm reading from paragraph 9. Thank you.
The financial services providers with information about particular individuals, which the service providers could use in conjunction with other information at their disposal, etc.
Now you might have...
I heard or seen in the CBA's institutional report in this proceeding that as far as they were concerned, and I think they gave this feedback directly to the Department of Finance as well, when they got that list from the RCMP, they considered it to be effectively binding on them to seize the account, that they did not in fact have any discretion.
Do you remember hearing that from them?
Well, what I certainly heard is that they heavily relied on it, but that they did some analysis to ensure that The people that were on the list were banking in their institutions and that knowing that they were involved in illegal activities and that they had accounts, they made a decision to freeze.
But it's certainly based on, I heavily know that they relied on the information provided by the RCMP that is accurate.
Right.
When you say part of the exercise of their discretion was making sure the person whose name was given to them by the RCMP was one of their customers, that's just a name check, right?
That's not an exercise of discretion.
Well, in the end, the decision, maybe not exercise, you call it exercise of discretion, the decision was lied in accordance with the emergency order.
Lied with the financial institution to make the final decision.
So they do a name check and that's the extent of their final decision?
I do not know.
You would have to talk to the financial service providers to see what procedure they put in place.
Once they receive, you know, we were not party to that.
So I know that the RCMP did provide information.
I do not know the nature and the extent of the information.
And how did the bank go about freezing the accounts after that?
What analysis did they do and how they went ahead?
I'm not privy to the details of those operational steps.
Okay, fair enough.
Mr. Clerk, could you just scroll further down in this document?
We're going to go a few pages down until we get to Exhibit A. Right there.
So this is an exhibit to the affidavit of Superintendent Baudouin.
And if we go down, we see...
Do you recognize that form, Jacques?
No.
No, I do not.
I've never seen that form.
We don't have enough time, so I'm going to ask you to take my word for it.
This is the form that the RCMP developed to give to the banks.
Okay?
And then there's some verbiage there that we're going to come back to in a second, but Mr. Clerk, can you scroll down a little bit further?
There's the page where the RCMP fills in the information, the owner of the vehicle, perhaps, that's parked in the blockade, or who knows what other information.
CPIC checks the Canadian police information.
Centre and other information.
So this is the form that goes to the bank.
I've never seen the form.
We were not privy to any exchange of information.
I take your point.
As you put it earlier, we were not a party to that process.
So I will accept that qualification.
Now, Mr. Clerk, could you go back up to that paragraph that the thing the bank sees when they get this form with?
A name on it that they've got it aside as one of their customers.
And look at the paragraph that begins the information.
The information which I'll ask you to go along with me.
It's the information that I just scrolled you down to about the information on the person who might be the bank's customer.
The information being disclosed is relevant to individuals or entities that are engaged directly or indirectly.
In an activity prohibited by sections two to five of the above noted emergency measures regulations.
And the paragraph above that, the second sentence, I am engaged in the collection and disclosure of information to entities.
That's the banks, right, Mishak?
Two entities that have a duty to determine as defined in section three of the emergency.
Economic measures order.
So can you follow the thrust of this document, that this is what the RCMP gave to the bank to do what has been called, both by your description and your information, sorry, your institutional report, and by the RCMP and Superintendent Boudoir's affidavit, the exercise of their discretion whether or not to freeze this bank account?
They are being told that they are being given information about a person who is a designated person under your emergency measures order, right?
Well, as I mentioned before, I've never seen this form, but if I put myself in the shoes of a financial service provider, seeing this form and basically saying that...
This is information about a person involved in illegal activities, and they're providing that information to the financial service provider.
I mean, that is information on which I would rely.
And as it says here, it says that the entities have a duty to determine as defined in Section 3. So I'd have to refresh my memory and look to Section 3, but I presume that, you know, once...
Ah.
uh Yeah, Section 3 says the entities must determine on a continuing basis whether they are in possession or control of property that is owned, held, or controlled by or on behalf of a designated person.
So if the RCMP comes to them to say, this is the information about a designated person, the financial institution is reviewing on an ongoing basis their relationship, and this is a client of theirs, I would think that, you know...
They will do, as I said, they will do their vetting.
Is this one of my clients?
I'm informed by the RCMP.
Yeah, this form that the person is engaged in these illegal activities, I would rely on that.
Personally, so if the financial institution did, I...
I wouldn't be surprised.
But I can't.
Again, I'm making a lot of presumptions.
But I think you've captured well what probably the average reader would infer from the documents we've just been looking at.
If you're a bank manager and you get this, the RCMP sends you this form and it says the person listed below is a designated person under the emergency measures regulations and you as a financial institution...
I'm sorry.
The form doesn't actually say the person is a designated person.
So this is a form the witness hasn't seen before today.
And if you're going to characterize it, please be very accurate about it.
Let's take that quibble from the Government of Canada's Council.
It doesn't say the person is.
It says the information being disclosed is relevant to individuals or entities that are engaged directly or indirect.
Indirectly, inactivity.
And Ms. Jacques, you know that what that is is the definition of a designated person under the order, right?
Yes, I know that.
Thank you.
But I agree.
I mean, to answer your questions, I have to make a lot of suppositions, but I take it for granted that...
If you're a bank manager and you get this piece of paper from the RCMP and you do the name check, you freeze the account, right?
I do not know that, but...
That would seem reasonable to me.
Thank you.
So you say we were not a party to this part of the process.
We had Deputy Commissioner Duem say, I didn't write this law.
We just implemented it this way, and it was up to the banks to decide.
And so the question is, if the government is saying that these measures were the right thing to do, right?
And the Department of Finance says we had no part in the enforcement of this, and the people who had enforcement in this say we didn't write this law.
Who takes responsibility for the fact that these accounts were frozen, that people couldn't pay their rent, that people couldn't buy their groceries?
Who takes responsibility for that?
We certainly designed the measures, and with respect to the implementation, we...
Once, you know, had discussions with various departments as we...
You have to understand that this moved very, very quickly.
We went from a situation where we're looking at potential policy options under the Bank Act to very rapidly looking at the possibility of implementing the Emergencies Act and developing these orders.
In developing those orders, we tried to be as practical and targeted as possible.
And that's why we wanted to ensure that information could be shared with various enforcement forces, including the RCMP.
We had discussions with the RCMP and with the financial institution to ensure that we basically implemented and or helped to the extent possible, provide the information.
With respect to the Emergencies Act and these orders.
These are not the type of orders.
I mean, it was the first time, I think, in 35 years or if ever that the Emergencies Act was ever used.
We're working on very tight timelines and the implementation was quite rapid.
We're also working with evolving facts.
We didn't know what we were looking at.
You know, the situation was evolving.
There were various information circulating.
And when you're trying, anybody that has tried to develop policies, even in normal circumstances, and to ensure that these policies are properly reflected into law and to apply that law, I mean, just even that is not a simple factor.
So I think to the extent that we developed the emergency, the order, and that we had a successful implementation of that order, in my view, It was quite a feat because the focus was on the people that were involved in illegal activities and that were funding those illegal activities.
We also told people ahead of time that if they continue to fund illegal activities or be involved in those illegal activities, that the bank accounts could be frozen.
People had noticed ahead of time.
And if a decision was made to stay on the premises.
To continue to stay involved in those activities, these people knew what could happen.
Let's move to that point exactly.
In your institutional report, and we can call it up if you want, but you described one of the purposes of the Emergency Economic Measures Order as to dissuade ongoing participation in the protests.
Do you remember that?
Yes, I do.
And you might not have...
I heard the evidence of Deputy Commissioner Duem, but he used the expression deter and disrupt.
So the concept of deterrence from the RCMP, from the Department of Finance, we have the concept of dissuasion, so probably synonyms for the same concept.
I think a better word for how we were thinking about this is to create a set of incentives.
To bring a peaceful end to these disruptions.
I'll just expand on that, or allow you to expand on that, Mr. Sabia, because I think that's a good point.
One of the prime objectives of dealing with the convoy problems in the way that the emergency economic measures order was fashioned...
Was to find a way to bring a peaceful end to the demonstration, because if you could do it with freezing bank accounts or whatever other measures were necessary, that was an awful lot better than having to go in with police and clubs, right?
I think, again, a statement of the obvious, a peaceful end to almost anything is better than a non-peaceful end.
And that's very much what we were focused on here, was to create.
As I've said, a set of incentives for the point having been made.
I mean, people have every right to protest.
That's an important part of our democratic system.
And there were no easy answers here.
But finding instruments that create an environment where people have an incentive to go home, having made their point, that seems to us to be a path worth pursuing.
And again, I think I'm trying to amplify your point better than going in with the police, if you can get it to happen the way you just described.
Well, I think, you know, if you, from what I understand, the testimony that this commission's been hearing from law enforcement and indeed, I think, from Superintendent Baudouin as well, I think there's a pretty wide acknowledgement that these financial measures did By
all means.
I will admit to being a little puzzled about your point.
So in my mind, this is actually pretty straightforward.
Now, you know, I didn't go to law school, so maybe I'm missing something.
That's an advantage.
Well, my daughter is finishing law school, so I don't know.
I'm of two minds about whether this is a good thing or a bad thing in any event.
So what did we do?
At the Department of Finance, we basically set policies.
So we set a policy that said under the authority of the Emergencies Act, the Emergencies Act having already declared certain activities illegal, we set a policy that said the financial system, bank accounts, other types of accounts, should not be used in support of what was then declared illegal activity.
Point one.
Point two.
We, the way the system worked, which seemed to us to be pretty logical, which is the RCMP working with other areas of law enforcement, the people on the ground who had the information, were then providing that information to a set of financial institutions who had their own processes, which they use every day for other types of fraud and other things, as Isabel has mentioned.
And they put those two things together.
So that seemed to me to be a pretty good outcome in that the people who had the microscopic information or the micro information of who was doing what was feeding that into financial institutions and financial institutions were using that as a positive input into the decision making that they were going to have to do.
And then empirically, I mean, I think of the 280 Accounts that ended up being frozen, I want to check my numbers, but something like 256 or 257 of them came from the RCMP.
So obviously there's a pretty high correlation there.
Doesn't mean that the banks didn't do some additional things because obviously there's a difference between 257 and 280.
But yes, your point being that the RCMP's work based on...
In the field, understanding of who was doing what, had a significant bearing on what the banks did.
So that seems to me to be pretty reasonable, in terms of implementing a policy, pretty reasonable set of ways of going about doing it.
It's a logical sequence.
What I'm trying to find is who says we were the ones who seized.
The bank say we were told to do it.
The RCMP says we didn't tell anybody to do it.
You say we weren't involved in this.
But we set a policy.
We set a policy and we are accountable for that policy.
Thank you.
That is exactly what I wanted to make sure we got to before we finish with the panel.
Now, on a related point, I was moving on to the issue of the idea of the use of these account freezing or otherwise preventing people from dealing with their savings as a deterrent as opposed to a tool to stop.
The criminal activity or the illegal activity because you'll appreciate you're nodding, Mishak.
There are two different concepts.
One is you cut off the flow of money to stop the illegal activity and the other is you deprive the person of access to their funds as a deterrent so they go home and hopefully go home without the police having to engage in public order.
Those are the two different concepts.
Yes, as a deterrent on your second point.
Yes.
And one thing I should clarify, when I say we, I mean, the Department of Finance, we're not, I mean, we as in the government.
Thank you.
That's how I understood it, but I appreciate the refinement.
As I say, the first concept, I think, is...
It's intuitive to the observer, that is, stop the money from going to the people who are committing the activity.
But did you appreciate that you were moving to a different level?
I mean, in the first, when you go to the deterrent mode, because you're starting to affect more than the protester, and you know that, right?
In the first scenario, you're saying to the protester, we are going to cut off the money you're using to buy gas for your...
Truck or whatever.
And in the second mode, you're saying we are going to cut off your family's money that they use to buy grocery and pay their rent so you'd better get out of this protest, right?
You're nodding.
Well, I'm nodding.
I mean, I just understand what you're saying.
The question is...
And the question is, did you appreciate the significance?
Are there other examples where the Department of Finance has used its...
The government has used the authority on the instruction or advice of the Department of Finance to have that type of effect, where you're not just trying to stop illegal activity by cutting off the funds that flow to it, but you're trying to deter the illegal activity by getting at the family and the other people who need that money.
Well, that's not accurate.
The intent was not to get at the family.
Or to have any, you know, of those impacts.
That was not the focus.
The focus was to be able to act quickly.
And it had two prongs.
Like we're thinking, you know, we wanted to stop the flow of funds to fund those illegal activities.
And we wanted it to act as a deterrence.
So for those people on the Hill...
Or in other border crossings involved in illegal activities, we wanted to dissuade them from continuing their participation.
As we said rapidly, what was important is that one of the key features was we wanted to act quickly, as we said before.
So as quickly as we could freeze, though the accounts could be frozen, they could be unfrozen as well.
And the person that made a decision to stay involved in those criminal activities or illegal activities, it was their decision to stay there.
Certainly, are we conscious of the fact that we do not want, of course, you know, we did have questions and we had discussions with the CBA with respect to, you know, court order, like for child support, for example.
We certainly said, as you saw in the emergencies order, There is a section that basically indemnifies people from implementing and doing their best to use their judgment to implement the order and the measures that are there.
Certainly, we said the goal was not to punish or prevent payments of child support.
That was not the goal.
The goal was to ensure that people that were involved would make a decision to leave.
Those funds would have been unfrozen if they had, you know, made that decision very quickly.
Right.
And I don't know if you followed the evidence before the commission, but apropos the point of the deterrence, there have been police witnesses who've said they saw your measures work because they heard of people getting calls back from North Battleford or whatever, come home, the account's frozen, and I can't buy groceries.
The police saw that as your measures working because they were affecting people who had nothing to do with the protest other than that they were family members.
And I put it to you that you must have realized that would be one of the effects of freezing the accounts in the way that they were.
Develop the policy where we're focusing on those people involved in illegal activities.
And certainly in our daily discussions with the CBA and, you know, we had discussion with the RCMP, certainly these issues came to life.
That was not the focus of the policy development.
We understand that that was maybe some people were impacted, but we had discussions in the application to say our focus.
Was certainly on these people involved in the activity.
Thank you very much.
And Mr. Commissioner, I've used up my time, so I'll pass the podium over to those who want to cross-examine and perhaps pursue some of these issues further.
Okay.
Thank you.
I guess we'll take the morning break at this point to give everyone a chance to stretch a bit.
So we'll come back in 15 minutes.
Start with the cross-examinations.
The Commission is in recess for 15 minutes.
The Commission is in recess for 15 minutes.
The Commission is in recess for 15 minutes.
The Commission is in recess for 15 minutes.
Thank you.
Order a lot.
The Commission has reconvened.
Okay first the convoy organizers please.
Good morning.
My name is Brendan Miller and I am counsel For Freedom Corp, which is the entity that represents the protesters that were in Ottawa in January and February of 2022.
I have a few questions for the three of you, and hopefully we can get through this in the 20 minutes that I have.
So first, I want to talk to you about money laundering and terrorist financing.
You've kind of mentioned that previously.
And of course, That's dealt with via the Fintrac legislation, correct?
That is correct.
And you can agree with me that the protesters in Ottawa were not terrorists, correct?
I have no information to that effect.
You have no information to the effect that they were terrorists, right?
That is correct.
That's not information that I'd be privy to.
And you have no information that the protesters in Ottawa were laundering money?
Isn't that right?
The Department of Finance did not receive any information to that effect.
It's not information that we would typically receive.
But Deputy Minister, you can agree that during the IRG meetings, you were present?
Yes.
Right.
And at no time during those meetings were you ever informed that...
Any of the protesters in Ottawa were terrorists or were money laundering?
Sorry, just to interject for a moment.
As far as the questions asking what ministers may have discussed amongst themselves in those meetings, that would be covered by Cabinet.
I'll rephrase.
Between the dates of February 10 and February 14, 2022, at no time were you informed that there was terrorists within the protesters in Ottawa.
Correct?
All I can say in reaction to your question is that the responsible agencies were watchful on that point and it was not an area where we had any expertise.
Sir, I understand that, but I'm not asking that.
I just want a yes or no.
You were never informed that these individuals in Ottawa, between the dates...
February 10th and February 14th were terrorists, correct?
We had no information one way or the other on that issue.
Right.
So the answer is no.
I said we had no information one way or the other on that.
So you have no information one way or the other.
Let's make it clear.
You were not informed.
You were given no information that these individuals in Ottawa protesting were terrorists.
Yes or no.
Well, I'm not going to give you a yes or no answer, because my answer is that we didn't have information on that one way or the other.
It's just not an issue that we were involved in, cognizant of, etc.
But was it not...
I understand from the records that FinTrack and the Ministry of Finance...
Based on a report in the media on January 25th, with respect to the crowdfunding, all right?
That is what brought this to their attention, and FinTrack and the Department of Finance started to look at these individuals in Ottawa with respect to financing.
Can you agree with that?
Well, no, I can't, because I don't have enough information to enable me to.
I mean, at the time, we are not, and it's quite appropriate, we are not privy to information that Fintrac has.
That information, Fintrac, as you know, is an agency that is all about intelligence gathering, detection, etc.
It's not about information.
And so that information, just hang on one sec, that information...
Goes directly in the case of suspicious transactions or concerns about money laundering or whatever.
That information goes directly from the leadership of FinTrack to law enforcement authorities.
It never comes our way.
Right.
And I take it that between February 10th and February 14th, no law enforcement official informed you that there was money laundering going on with respect to the protests in Ottawa, did they?
I was not informed of...
Anything with respect to money laundering one way or the other.
So, and I think, you know, it's fair to say then that the FinTrack legislation and the legislation dealing with terrorist financing and money laundering simply had no application to the protesters, did it?
Yeah.
No, it did.
Maybe I'm misunderstanding your question, but it did in that...
Through that process, it confirmed that we needed to adjust the regulatory perimeter of FinTrack to include crowdfunding platforms and payment processors.
So we did do that on a temporary basis under the authority of the Emergencies Act.
And we applied it only to, in that act, only to crowdfunding and payment processors who had information with these illicit activities, and then we made it longer term.
Before that protest, and before the invocation of the Emergencies Act, there was no authority to do that.
Right?
That's why you're saying that's why you needed this.
Is that fair?
That crowdfunding platforms and payment processors were not subject to review by FinTrack.
Yes, that's accurate.
But even if they were not the crowdfunding, etc., if there was terrorist financing and there was money laundering, then you could apply FinTrack and the criminal code to crowdfunding, right?
Without the Emergencies Act.
I can't answer that question because I'm not expert enough in FinTrack's legislation.
Okay.
So I want to talk to you a bit about some crowdfunding.
With respect to crowdfunding, you can agree it's done by way of people donating to a fund online, right?
Yes.
And people donate to that fund typically to support a cause?
Yes, that's one yes.
And can you agree with me that some causes set up in crowdfunding are set up for a political cause?
I'm sure that's probably true.
And can you agree that a protest of a government policy or legislation is a political cause?
Well, I'm not going to answer your question in my capacity as the Deputy Minister of Finance.
I guess I'm going to answer your question in my capacity as a citizen.
And I guess my answer as a citizen is, yeah, that sounds like it makes sense to me.
Right.
And can you admit that the GoFundMe and the Give, Send, Go for crowdfunding set up by Ms. Litch and the protesters in Ottawa were a crowdfund set up to support a political cause?
Well, I guess, you know, as you know well, GoFundMe ended up, in effect, refusing to continue to provide its platform for these funding activities.
We'll get into that.
So GoFundMe obviously came to some conclusions about what was underway here that caused them to be uncomfortable enough that they wanted to...
Right.
Restrict this from their platform.
Right.
I understand that.
But can you agree that when the GoFundMe was set up in January 14th, prior to the protest, prior to them arriving here, that this GoFundMe, this crowdfund, was set up to support a political cause?
Well, it was set up to support the fundraising activities of the people who were...
Protesting both in Ottawa and I guess across the country.
Right.
And you agree that the protests are a political cause?
Well, they're about a political issue.
Yeah.
Right.
And so let me just put this to you.
This is in one of the reports already that's overview reports that has been put in evidence.
And I'm just going to read it to you and then ask you a question about it.
The original GoFundMe on January 14th as amended later in...
To our fellow Canadians, the time for political overreach is over.
Our current government is implementing rules and mandates that are destroying the foundation of our businesses, industries, and livelihoods.
Canadians have been integral to the fabric of humanity in many ways that have shaped the planet.
We are a peaceful country.
That has helped protect nations across the globe from tyrannical governments who oppress their people, while now it has happened to us.
We are taking our fight to the doorstep of the federal government and demanding that they cease all mandates against its people.
Small businesses are being destroyed, homes are being destroyed, and people are being mistreated and denied fundamental necessities to survive.
It's our duty as Canadians to put an end to this mandate.
It is imperative that this happens because if we don't, our country will no longer be the country we have come to love.
We are doing this for our future generations and to regain our lives back.
We are asking for donations to help with the cost of fuel, food, and lodging to help ease the pressure of this artist's task.
But it's a small price to pay for our freedoms.
We thank you all for donations and know that you are helping reshape this once beautiful country back The way it was.
So, can you agree that premise that I've just read to you for seeking donations, I know speaking as a citizen, you can agree that that's asking for donations to support a political cause, right?
I think it's asking for donations to support somebody's particular view about a public issue.
Right, and that's a political cause.
Well, I'm not going to judge whether it is or not.
It's a public policy issue that people have a right.
Perfect right to agree with or disagree with.
And I guess this group of people were out using a crowdfunding platform as a source of raising money for it.
Obviously, it ended up being pretty problematic because GoFundMe walked away.
And we're going to get into that.
So you agree that many people donated.
To both the GoFundMe and the GiveSendGo, right?
I don't know what the numbers are, how many people donated.
And you know that those donations, based on what I've just said to you, were made on the premise of that statement.
The money donated was to be used to support the protest, right?
I can't speculate as to why people made those donations or not.
I don't have any access to that information.
As the Deputy Minister of Finance, I'm sure you know that before the protesters even got to Ottawa, that as of January 25th, the GoFundMe had already raised more than $4.5 million.
You know that, right?
I do not.
I did not know that at the time, no.
All right.
And I take it you are aware and had some discussion that donations to political causes I'm aware that the Charter protects the right to free expression.
Right.
And were you aware that donations to a political cause have been interpreted and continue to be interpreted by the highest court?
As being part of freedom of expression.
Were you aware of that?
Yeah.
Look, the issue here, at least in my opinion, is not about donations because nobody acted.
Even in the context of the Emergencies Act, no one, I mean, the RCMP was, I think, quite clear and publicly clear.
That their intention here was not to take action on people who had made, in most cases, I think, relatively modest donations.
So there really wasn't action here, as best I can detect, action here with respect to the activity of making donations.
I understand that.
But the making of the donation, right?
You make a donation.
Under the asbestos that it's going to be used for the cause, right?
That's how the donation, why the donation is made.
You can agree with that.
Well, I guess that would be the donor's expectation, whether or not it happened or not.
It's something that I can't comment on because I don't know.
And so when the government interferes with what is to be done with those funds, do they not, can you not agree that it interferes with those donors?
Freedom of expression.
Can you agree with that?
Look, the government took a decision that these activities were illegal.
Right.
And we've been having some trouble in establishing what that is, and we're going to get into that.
But I'm going to move on to another part.
This commission has heard evidence that the money from GoFundMe, all right, you talked about it being frozen.
It was frozen following a request in a meeting between the City of Ottawa, the municipality, the mayor, and the Ottawa Police Service.
Are you aware of that?
I have absolutely no awareness of that, nor is it relevant to our work in the Department of Finance.
Right, but you said it was relevant to...
You said it was relevant, just in your own testimony.
No, I did not say it was relevant to our work in the Department of Finance.
I did not say that.
Sir, let me just finish my question.
You had said it was relevant that GoFundMe, on their own accord, froze these accounts, right?
You just said to that.
They obviously saw an issue.
And you said that just in your evidence while I was examining you.
So I'm going to ask you a little bit about it, okay?
And you can agree with me that the City of Ottawa, the Ottawa Police Service, they're government entities.
That's not debatable, right?
They're not federal government entities.
Right, I know.
And they don't have anything to do with our job in the Department of Finance.
I understand.
But you can agree that they are government entities.
They are provincial and municipal government entities, right?
I guess so, if I go back to civics class.
Yeah, I guess.
Well, I'm glad that you're thinking about civics because that's part about what this case is about.
Can you agree that when a municipal government...
Or a mayor of a city, or a municipal police service, like the Ottawa Police Service, requests of a bank, or GoFundMe in this instance, to freeze funds.
But that is government action.
Can you agree with me on that?
Just so that I understand what you just said, that...
Where a government entity requests a fund, or requests a bank, Or an institution to freeze private funds of donations, of private bank accounts, or anything like that, where they make that request, and it's from the government.
Is that a government action?
Well, yes, I think so.
And I take it to your knowledge that there's no legislative authority that you know of, federally or provincially, that would authorize A municipality or a police force to make such a request?
Look, all I can do is comment on this from the perspective of A, the Department of Finance, and B, the federal government.
And the federal government, in the Emergencies Act, declared that these activities were illegal.
As to your point about GoFundMe, GoFundMe took an independent decision that had absolutely nothing to do with government action.
Sir, the mandate of this commission is to look at the circumstances surrounding the invocation.
I understand what the government did.
We're trying to find out why.
Okay?
So let me ask you again.
To your knowledge, I take it that you know that there's no legislation in Ontario or federally, all right, that would authorize a municipality or a police force to request an institution, a bank, GoFundMe, to freeze accounts.
Can you agree with that?
Look, you're asking me questions that...
We in the Department of Finance have absolutely nothing to do with.
You want to ask me questions about our role in finance, that's fair enough.
But these questions, they're not what we do.
But you understand financial legislation, do you not?
You understand that legislation governs your ministry, right?
Of course.
Right.
And then you also look at the legislation in provinces.
And you try to make them interact and work together.
Is that not fair?
Cooperative federalism, I'm sure you've heard that principle.
Well, with respect to the broadly understood, the operation of the economy and other things, yeah.
Right.
But we're not a public safety institution.
We're not an institution that is responsible for law enforcement in any way.
are lots of other agencies of the government of Canada that are responsible for those things and are responsible for the interactions that So if that's the case, then why do they even ask you to come to the IRG?
Why?
I think the answer to that's pretty straightforward.
There was a very substantial preoccupation on the part of the government with respect to The economic consequences of the disruptions that were occurring in the country.
And our role at the time, we were people doing quite a bit of work on that issue, and that was extremely relevant to the decision-making that was underway across the government of Canada at the time.
I understand that.
I'm not trying to cut you off, but I'm just trying to stay under my time limit.
So here's the thing.
On February 10th, the IRG minutes that we do have, that are unredacted, The Prime Minister advises we have two tracks.
He went into it with two tracks.
The first was to use general legislative authority, and the second track was to use the Emergencies Act, all right?
And I take it, and there was tasks.
We have that evidence.
Tasks were given to your ministry.
Tasks were given to other ministries.
I can tell you with respect to the options that were being put forward outside of the Emergencies Act, we don't know what those were because...
The government's claims, solicitor claim, privilege, and Section 39, Cabinet Confidence.
So I have no idea.
But I take it that there had been inquiries with your ministry between February 10th and February 14th about what legislation could be used in order to deal with the crowdfunding.
Look, I don't know whether you were in the room this morning or not, but...
I thought we had a pretty thorough discussion of that with the Commission's Council.
Sir, I understand you're asking me questions, but if we're both asking questions...
No, I didn't ask you a question.
I get it.
I understand.
But if we're both asking questions, none of us will have answers.
So let me just ask the questions and we'll go on.
All right?
So I want to talk to you now about the legislative change versus regulations and orders in Council really quickly.
And can you agree?
You're going to have to make it quick because you're already over your time.
Thank you, sir.
Two points.
The legislative change versus regulations.
You said you couldn't deal with this by way of regular legislation through Parliament.
Why?
No, what we said, I think what both Isabel and I said earlier, was in the circumstance where our concern was limiting the duration of these disruptions as much as possible,
that The legislative process was something that took a considerable amount of time and therefore was not really a very effective instrument for dealing with a situation where time was a significant impact, was a significant determinant of the extent of its impact on the national economy.
Okay, but you can agree that the legislative process with Parliament as a whole is far more democratic than a meeting in Cabinet that's...
Essentially in camera and privileged.
There's no debate from opposing parties.
These things are then just passed by the executive, right?
Like it doesn't represent input from the rest of parliament, correct?
Look, I think the government took a decision as the duly elected government of the country to invoke...
The Emergencies Act, which is itself a piece of legislation that was through Parliament, and the government took a decision to use that in this circumstance and has been, I believe, scrupulous in how it was used, kept the duration of the Emergencies Act to an absolute minimum.
I mean, it was, what, seven, eight days maximum for the whole thing.
So I think...
The government has proceeded in a manner completely consistent with the laws of Canada.
I understand.
But you can agree that in invoking the Emergencies Act, Parliament, via that legislation, lays out criteria that have to be met to invoke it, right?
Yes, but the Emergencies Act had to be...
There was a parliamentary process that followed the government's invocation of the Emergencies Act in a manner consistent with the laws of Canada, and that was done.
Right, and the documents to date show that because they were able, the NDP, okay, I'm going to ask them, you know, about this last question.
The NDP, before the debate even took place, had already agreed to support the motion, okay?
That's in evidence.
The question is this.
So they support the motion.
It goes to the Senate.
They get indication that the Senate is not going to vote in their favor.
So they pull it.
And my submission to you, that's the parliamentary process, right?
Because if there was no grounds, To invoke it and the Senate was going to revoke it, that's a good process, isn't it?
I'm not going to comment on that.
I didn't think you would.
Thank you.
Okay, next I'd like to call on the CCLA please.
Good afternoon.
My name is Eva Krajewska and I'm counsel for the Canadian Civil Liberties Association.
I'd like to start off by going back to before the emergencies orders and the options that your ministry was considering.
And if I could ask the registrar to pull up ssm.can.403761.
This is a memo that was attached to an email, Mr. Sevilla, that you sent to Deputy Prime Minister Freeland.
On February 8th at 1,700 hours minus 5. I think that's right, minus 5. And do you recognize this memo, sir?
Yes, I think so.
So in this memo, you lay out three options to the Deputy Prime Minister.
The first is the use of the Bank Act.
The second option is redacted on the basis of cabinet confidence.
I've asked my friend at the DOJ if she would reconsider that, and I appreciate that will take some time.
And then the third option is moral suasion.
And this is not something that you discussed with commission counsel this morning.
And I just want you to take a look at that second paragraph where...
I think it was the minister's expectations to ask bank CEOs to remain vigilant in their review of business relationships to ensure that they're not being used to support illegal activities.
And is that one of the considerations that was given to Minister Freeland into how she should deal with this situation?
No, what this is is just...
A summary of possible approaches that could be used.
These are not and shouldn't be construed as recommendations to the minister in any way.
And the description that you see in the second paragraph is really about, well, if one were to go down the path of moral suasion, here's the kind of thing that it would involve.
Okay.
And when you talk about support illegal activities, you would have to define what that means in these circumstances, correct?
Yes.
And I think you stated earlier today that the emergencies, the declaration of emergencies and the orders underneath it defined what those illegal activities would be.
The emergencies acted.
That's my understanding.
Yes, it did.
Thank you.
And now, if I can move on to the scope of the measures, and many of these questions will be to you, Mr. Sabia, and to you, Ms. Jacques.
You agree that the emergency measures order prohibited any entity as defined in Section 3, which covered both provincial and federal institutions, from dealing with any property held by a designated person, right?
That was the, if I impair, you'd agree with that characterization of the order.
Can you pull up Section 3?
Do you have it with, do you have Section 3 before you?
If not, I'll pull it up, yes.
Oh, no, wait, I left it at my chair.
Sajid, can you help me with the SSM number?
If you could please pull up SSM.CAN.401911_REL.0001.
So this is the Emergencies Measures Order, which is the financial order, and Section 3 is the one that covers the institutions that...
Um...
Okay.
Well, I have the wrong document.
Okay.
There is a list of institutions that are covered by the order, correct?
Those include financial institutions, credit unions, insurance companies.
Those cover both provincial and federal institutions, correct?
That is accurate.
Right.
And it prohibits...
Prohibits those financial institutions from dealing with the property of any designated person.
That's correct.
Right.
And that essentially freezes their assets.
The designated person's assets.
Yes, they can suspend dealings with those individuals and it could lead to the freezing of...
Freezes an account, not necessarily.
Well, freezes their ability to deal with their property held at those institutions.
Yes, I see you're nodding.
Sorry, we need an audible.
Thank you.
And you saw that it applied to joint accounts, to registered savings accounts, and to investment accounts.
That is true.
And you're aware that the Canadian Bankers Association voiced concerns to both you and the RCMP about the scope of these orders.
I don't recall the CBA voicing concerns with the scope of the orders.
I do not recall that.
Do you remember any representatives from banking institutions raising concerns about the scope of the orders?
The scope?
No, but the impact?
I mean, one concern that was raised with respect to the impact it may have with respect to child support.
It's the only concern that I recall.
Do you remember that they asked whether it applied to joint accounts?
That's very possible, and if they did, I would have...
Said yes.
Right.
And your office prepared or someone at the department prepared a kind of ongoing and consolidated question and answers, kind of an FAQ for banks, correct?
Well, not for banks.
I mean, we had...
Sorry, I say banks.
I mean, for financial institutions.
I mean, we had prepared some frequent question for internal purposes, yes.
This is, if I can just pull up, ssm.can.
Seven zeros.
to And I think this is the consolidate at FAQ.
And there were questions about...
Correct.
Thank you.
page number six Scroll down to RCMP, please.
There we go.
When we say accounts, what exactly is being referred to?
So those are the types of accounts that this would apply to, correct?
Yes.
And if we go to page seven, there were questions about whether small donations were being investigated?
Yes.
And your response or the RCMP response was that they weren't, correct?
They were not being investigated.
Yes, that was not the focus of their investigation.
But you'd agree that on the face of the order, small donations were captured on the face of the order.
And Mr. Sevilla, I think you even provided that advice to Minister Freeland at some point.
I don't recall.
I honestly don't recall that.
I mean, I think that's true.
Yes, they were captured.
I think that's true that they were captured, but nothing.
Okay, I'll just put it for reference for the record.
And on those small donations, just to specify, yes, they were captured, but it's important to note that certainly the order was not retroactive.
So any donations that would have been given prior to the Emergencies Act being enacted were not captured.
And as we said...
Previously, it's important that you look at the context as to when we came about to draft the order, we didn't know how the situation would evolve, but in the application of the order, certainly the focus was not on those donations.
Correct.
And Ms. Jacques, I think it was you who provided answers to those questions at ssm.can.
6-0-54, where Minister Freeland had questions with respect to the order, and Mr. Sevilla, you asked for responses on those questions, and Ms. Jacques, you provided the answers in red where you stipulated.
Can we see you?
I know.
I'm just going to talk while they pull it up, otherwise I run out of time.
It'd be good just to read it.
I would for sure give you a chance to see it.
The question was, and what about people who were never at the protest but made donations?
And your response was, as stipulated in the order, it is possible that a person who indirectly funded the illegal protest for the benefit of a person involved in the protest had their account frozen.
This would only occur if they made a donation after September 15th, which is, as you were saying...
February 15th.
February 15th.
It was not retroactive.
So if you go to page two...
There's the question, the second paragraph.
Do you see that?
And what about people?
Yes, that was the question for Minister Freeland, and then your answer is in the less dark font.
Yes.
Okay, and...
And I think some of the financial institutions asked if they were able to exercise some humanitarian exceptions as well to the orders, and maybe this is what you're referring to as child support, correct?
And certainly we told them to, and as they have, use their good judgment in applying this order throughout.
Yes.
And they also asked if they could continue to process automated payments from the accounts, correct?
That I do not recall if they ask me that question.
And the order also applied to auto insurance, correct?
Yes.
Yes, but the RCMP decided not to communicate with insurance companies as they wanted to ensure that it would be safe for vehicles to leave the demonstration.
Yeah, now this is an important point because it goes to what we were trying to accomplish.
So that created the possibility that that could occur.
In reality, in actuality, it never occurred, but it did have a helpful incentive effect, to use that word again, with respect to wanting to find a peaceful solution to these disruptions.
The RCMP's approach to this was, I think, completely appropriate.
The risk to the truck owner was there, but action was not taken because if the action had actually been taken, it could have, in certain circumstances, impeded the movement of the truck, which nobody wanted.
But it did create an issue of uncertainty.
That a truck driver would have to assess and therefore hopefully encourage the truck driver to leave peacefully, which was the objective all along.
So, Mr. Sevilla, I just want to, with respect to that answer, I think to me, the order did more.
The order would have allowed the RCMP to ask for that person's insurance to be cancelled.
What the RCMP did is that it did not exercise their discretion under the order to do that.
But the order, on its face, and the insurance company could have proactively cancelled that truck driver's insurance, and then it would not have been safe for that truck driver.
But it's instructive that that never happened.
Right.
So it's good that it did not happen, that that part of the order was not exercised.
It's positive that...
It had the effect that it had, which was creating the possibility that that might happen, but that it never actually happened.
That's an almost ideal combination.
So in kind of economic terms, it created a microeconomic incentive.
It did.
And I want to go back to the issue of What happened between the financial institutions and the RCMP?
It was not just that the RCMP provided information to financial institutions, but under the order, the financial institutions were obligated to provide reporting to either the RCMP or CSIS with respect to the freezing of accounts, correct?
Yes.
So it was the financial institution's onus to ensure that they were in compliance with the order.
When they had information, yes.
Not just when they had information.
No, no, but you mean it's their responsibility to be compliant with the law, yes.
And also there is a clause that's plea that they need to share information that they have with the RCMP and or CSIS.
Correct.
And so, Ms. Jacques, when you mentioned earlier an indemnity that was provided, that indemnity was only provided to financial institutions if they complied with the order.
It did not provide an indemnity to financial institutions not to comply with the order or not to report to the RCMP, correct?
That is accurate.
So the financial institutions, if, as you say, they decided to...
They were taking the legal risk for doing so.
It was their decision to make and do the assessment and consult internally and receive the proper advice on their decision.
Because they would receive a list of names or vehicles from the RCMP and then they would have to report back to the RCMP of all the lists of accounts that they froze.
And so the RCMP could compare both lists later and decide whether the financial institution complied with its legal obligations.
I don't know if there was any such exercise by the RCMP to review compliance with the order.
I've never heard that in the past.
But the order provided for that information sharing?
It was to provide for the information sharing to help the RCMP in pursuing some maybe investigation.
Yes.
And then I understand...
Not to go back, not for the RCMP to take account.
That was not the purpose.
It was to share information.
To allow the RCMP to do their job.
But it could have been used to decide whether there had been compliance.
It could be read that way.
It was not intended that way.
I find that to be a stretch.
And I understand that your department received aggregate information of how much was frozen by financial institutions.
You did not receive the specific accounts, but you received the aggregate numbers, correct?
From the CBA, yes.
From the CBA.
And if I could take you to ssm.can50209.
This is a long email chain between...
Deputy Prime Minister Freeland's office and your department regarding the enforcement of the Emergencies Act.
And if we could go to the last page of this document, page 8. This is on February 16th, which is one day after the order is made public.
Alex Lawrence, who's the Director of Communication for Deputy Prime Minister Freeland, asks for tangible figures that could be made public the next morning about the enforcement measures.
I'm not sure if you personally were in communications, but your office was in communication with the Deputy Prime Minister to ensure that she had updated numbers of the number of accounts that were frozen and the quantum that was frozen.
Both were being provided to the Deputy Prime Minister, correct?
Certainly, we provided the information usually via Michael.
Through Mr. Sevilla, yes.
Yeah, so we were, no mystery here, we were wanting to track this information, again, as you've said, not with respect to individual names, etc., but aggregate data.
We were wanting to track that, one, to see whether or not this activity was actually underway, that what we had set out to do was actually underway.
And second, Again, and this is, you know, very important.
We were tracking it because the whole intent here was to have this in place for as short a period as possible so that it could be, that this kind of activity could be removed as quickly as possible because hopefully it was no longer needed.
Because if it had the intended effect of bringing a peaceful land or contributing.
To bring a peaceful end to these disruptions, then mission accomplished, and this whole thing should go away.
So in the interest of being able to do that as promptly as possible, yes, we were tracking this fairly carefully.
And as you know, I think as of February, what, the 21st or 22nd, pretty much all of these accounts had been unfrozen.
So it was actually quite...
It came and went quickly, which is what our intent was at the time, because it contributed to the peaceful end in a way that we had intended.
Let me just pick up on that last point that you stated, that by the 22nd, you're aware that the RCMP had communicated to financial institutions that they should begin unfreezing certain accounts, correct?
Well, yes, because as the disruptions were coming to an end, the RCMP was doing a good job of communicating that to the Financial Institute.
And I'd suggest that there's also maybe a third purpose to Mr. Lawrence's email, which is that I think the Deputy Prime Minister wanted to be in a position the next morning at the press conference to inform the public that measures are being taken.
Yeah, look, I can't speculate as to what Alex's purpose was or...
Behind that email, the minister wanted to be kept in the loop on the level of activity and whether we were seeing progress here, and we certainly kept her informed of that.
Thank you.
This is going to be my last question, which is with respect to FinTrack.
I understand from the FinTrack report that they did not see an elevated level of suspicious transactions or a noticeable change in...
Transaction levels during the period of the Freedom Convoy.
And you agree with that, correct?
Well, I think that period from the invocation of the Emergencies Act to when the Emergencies Act was then rescinded or removed was such a short period of time that it's, you know, I think quite logical.
I think there were only, I can't, don't hold me to number five or six transactions that did.
Right, but I think FinTrack's report is more than that.
Even in January, even to the lead up to the convoy and before the emergency period, they did not see an increase in suspicious transaction reporting under the PCMLF.
Yeah, the issue there, of course, as you know, is that because the perimeter of what FinTrack was actively reviewing, was probably narrower than it should have been because it didn't include crowdfunding and it didn't include payment processors, that clearly that was a gap.
And that gap needed to be addressed, which we did temporarily on a temporary basis in the Employment Act, in the Emergencies Act, and then on a longer term basis in legislation and regulations that followed.
Thank you very much, and thank you, Commissioner, for the indulgence.
Okay.
Next call on the CCF please.
Morning.
Hi.
Hi.
My name is actually good afternoon.
My name is Sajid Choudhury, and I'm counsel for the CCF, for the record.
So, Ms. Jacques, I want to take you to...
To the issue of the freezing the accounts, I know that we've talked a lot about that today.
And I want to invite you to answer some questions about lessons learned from that process and experience, which I take it was fairly unprecedented in Canadian history, because part of the Commissioner's mandate is to advise governments in the future about if and how to use these tools and how they might be adjusted.
If we could just do that for a minute.
So you've heard that for some individuals, and we've had testimony to that effect, that because their accounts were frozen, they weren't able to meet their basic necessities.
There might be child support, rent, food.
In one case, we had a witness testify that he couldn't buy heart medication for his son, and I think we can all agree that was not the intent.
I want to put to you this question that you've said, listen, whatever the order said on its face, when we provided advice to financial institutions about how to administer it, we asked that they use discretion.
But wouldn't it have been better to put a humanitarian exception into the terms of the order itself to ensure there was crystal clarity?
Not just to those institutions, but to members of the public who could have looked at the order online but would not have had access to that advice provided to banks and credit unions.
That, in fact, they had that right to obtain monies that they required to meet their basic needs.
Certainly.
I mean, looking at it...
You know, one of the key points that we did look at at the outset when drafting, and you must understand we were working on this fairly quickly, looking at a diminimous amount.
But we also understand that a number of people were donating small amounts to crowdfunding platforms, right?
And so there was always that possibility.
But looking at it, if we were to do it, I think we could craft some exemptions for the application for very specific cases.
It's not something that we did in the time that we had, but I don't disagree with you that it's something, you know, in hindsight that we could look at in being more specific in that regards.
Because the intent was not to affect unduly affect, you know, payments of child support.
Thank you.
And maybe a broader question.
On the same theme or on a related theme to the panel as a whole, which is about consumer credit.
And so I think the panel would agree that credit histories and credit scores, although kind of privately administered, are an important form of social and economic capital that citizens have.
They require those scores to get credit cards, to get mortgages, to get loans.
And so forth.
And there's been evidence that you might not have heard, but I'll ask you to take my word for it, that some individuals who had their accounts seized and subsequently those accounts were released to them, nonetheless, have had lingering effects on their credit history because of mispayments.
And that might not be an effect.
And so to your point, Mr. Sabia, that the act was only used for a limited time period, that might be true.
But the lingering effects of a decline in someone's credit history or credit score could take place or be experienced over many months or many years.
And should there not have been some thought and some aspect of the order that would have taken into account the long-term effects on individuals' credit histories and credit scores, By the temporary freezing of their accounts, even if only for a short time.
But you're talking about people here that were involved in unlawful activities.
Well, ma 'am, that's not true.
I mean, I think you've just said yourself that it was donors.
To our knowledge, no donors were affected by this order.
There were no accounts frozen, to the best of our knowledge, based on the information that we've received.
There were no accounts.
From donors that were frozen.
And the long-term effects on credit histories, that's not something that concerns you at all?
I think that's an issue for the financial institutions and how the financial institutions administer these things.
I don't think that's something that...
I mean, that's something that, as you know, in how the credit system works, that's something that the credit system should be able to deal with on its own.
And so, you know, Mr. Sabi, I put to you that although it's correct that it's a privately administered system, nonetheless, in this case, decisions of the government of Canada...
had a direct effect on how that system operated, not just in the short term, but for many months Well, I guess I would dispute that.
I think the government of Canada made some decisions with respect to the cessation of financial services, the freezing of accounts, to individuals who were involved in illegal activities and all that those individuals had to do.
Was to leave.
And let's put this back up a little bit.
The government announced its intention to proclaim or to invoke the Emergencies Act on the 14th.
It was very clear, very clear as of that date, and the Minister of Finance was very clear as of that date, that people involved in these Disruptions ran the risk of having their accounts frozen.
That was very clear.
So there was a period of notice there.
And it was very clear that all that had to happen was for those people to leave.
And if they did, their accounts would never have been frozen or that they would be immediately unfrozen if they did leave.
So I think people had reasonable notice.
And it was a very simple solution.
All you had to do was leave.
Sure.
And Mr. Sabia, I just put to you one final point on this theme, which is that the way you're describing the consequence on a credit score, it seems to me that you would agree with me that that's yet another economic incentive that individuals might...
Yeah, well, that was never...
That was never...
In our minds, that was never part of the intent of what we were trying to do, because honestly, I think that the credit system itself ought to be agile enough that those kinds of outcomes not happen.
Sure.
And I'd say to Mr. Sevilla, I suggest to you that if that had been an intended consequence, that would be a form of extra-legal sanction that went beyond the penalties in the orders.
But it wasn't any part of our intent, ever.
Could I take you to the issue of crowdfunding and the regulation of crowdfunding?
And so I know that one of the many issues on your agenda during the period leading up to the invocation of the Emergencies Act was the question of the available legal tools to curtail the flow of funds towards protesters participating in the...
In the various blockades.
And I recognize you're not lawyers.
I'm sorry to have to ask you these legal questions.
Isabel's a lawyer.
Oh, Ms. Jacques, well, it might be that you are going to answer some of these questions.
But I put them to the whole panel.
Probably shouldn't be.
And so what I'd like to do, if I may, if I could call Mr. Clerk to call up the following witness.
Uh, statement, uh, or interview summary for this panel, and it's, uh, W2S, WTS Many Zeros, uh, 59, page 7. Someday you'll have to explain to us who comes up with this classification system.
You know, I, I, I, I think council would like an explanation too, uh, Mr. Sabia.
So, um, so if we could just scroll.
Down a bit.
There we go.
Thank you.
So there are these two paragraphs here that I'd like to put to you for the record.
And so the first paragraph is the one that begins, finance also look to options under what, let's call it the money laundering and terrorism finance statute.
And would you agree that it says there that Deputy Minister Sabia and Assistant Deputy Minister Jacques stated that it quickly became clear that there was a gap in the Money Laundering and Terrorism Finance Act.
It did not apply to crowdfunding services.
It applied only to certain payment service providers, and this was significant and so forth.
You agree?
And you agree you said that in the interview.
And then if I could take it to the next paragraph, again, for the record, would you agree that you then added, Deputy, that an overriding issue with the options considered by finance was timing and any legislative amendments would take a long time to pass, whereas action was needed quickly?
You said that, okay.
And I said that this morning or this afternoon.
I think you said it both, this morning and this afternoon.
So you don't quite say it this way, but let me just put this to you.
Are you saying there that the only way that you saw or that you were advised to get the money laundering and terrorism finance legislation to apply to crowdfunding absent Using the Emergencies Act was a legislative amendment, and that just was not viable at the time.
Well, look, the gap here, that crowdfunding and payment processes were not in the ambit of FinTrack, this was something that people in finance had been aware of for some time.
This was not a revelation.
The issue here, so we've got to separate two things.
On the one hand, this gap needed to be corrected, just because with the rise in importance of crowdfunding, etc., this was an obvious oversight.
And it was the department's intention to recommend to the government that this be fixed, and it would have been in the traditional way that you would go about adjusting something like this.
So that and that was in a let's call it a steady state world.
So in this circumstance, obviously, we were not in a steady state world.
And our intention here was to move as quickly as we could to try to correct this gap.
And given the decision of the government to move in the direction of the Emergencies Act.
That created an opportunity to address the specific case.
But please note that in what we did here, we only applied it to crowdfunding platforms and payment processors who were somehow in some control of assets or capital or financing that may be associated with these, quote, illegal activities as declared by the Emergencies Act.
So it was quite limited.
And it was only in place for, what, a period of six or seven days.
We then, this issue having been resolved, returned to the more status quo kind of approach, and we did correct this in the April budget, I think we should at least.
So can I just pick up, though, on something you said?
So, you know, you kind of drew a distinction between, let's call it government as usual or normal, and the urgent situation that was thrust upon you in early February.
And in the government as normal approach, what you say here is that there would need to be a legislative amendment.
But that's not the moment that Canada was in at that time, you say.
There was no time for a legislative amendment to amend.
Well, a legislative amendment or even a regulatory change because they too take it.
So you've anticipated my next question.
So look, I want to take you to the following document.
It's CCF Many Zeros 42. Thank you, Mr. Registrar.
If you could scroll down.
So if we could stop there, actually, sorry.
You can see this is an amendment to the regulations in relation to the money laundering and terrorism finance statute.
It was promulgated on April 5th by the Governor and Council.
And as you know, the Governor and Council just does that.
There's no legislative process involved there.
And then if you could scroll down, please, to Section 2. And so here, if we could go...
Yes, actually, that's right.
The regulations are amended by adding the following before Section 30, it says, for the paragraphs of subparagraphs 5HV and H.1V of the Act, crowdfunding platform services are a prescribed service.
So I'd put to you that what this regulation did was to extend...
FinTrack's authority and the application of FinTrack to fund crowdfunding services.
Would you agree?
Yes.
But this could have been done just as easily in early or mid-February.
Yeah, not just as easily.
Why is that?
That's because the regulatory process, there are several steps to it.
It is quicker, you are correct, in typical circumstances, than the legislative process, but there are a number of steps.
But Minister, sorry, Deputy Minister.
Yeah, big difference.
Sorry, excuse me.
But I take you, if you'd like, I can take you to the terrorism financing legislation itself, but we don't have time.
But I'd put to you this, that there's nothing there in Section 73 sub 1 or 73.1 sub 1 that spell out.
A lengthy, detailed regulatory process.
It might be that that is what normally is done.
But as a matter of law, that's not required.
And so if that's true, then couldn't the government, couldn't the federal cabinet, just have enacted this regulation in February?
Yeah, but I failed to see, given how narrowly the Emergencies Act was used here.
In applying it only in a very, very narrow slice of crowdfunding platforms and payment processors, you know, I failed to see how there's really a meaningful distinction.
And importantly, that that very narrow change was only in place for six or seven days.
And we then corrected it later as per this process.
So I think we're kind of both on the same page.
Well, Deputy Minister, let me just conclude by explaining to what we see the differences being and put it to you.
So, I take it you've read the Emergencies Act?
And you've read Section 3 of the Act?
Yes.
And Section 3 has, at the end of it, a last resort clause.
It says that the Emergencies Act can only be triggered as a last resort if no other legal tools are available and are effective.
And I'd put to you that this shows that in relation to Fintrac, there was another option available to the federal government, absent or short of declaring an emergency.
Mishak, I can see you want to see.
Yeah, I did not want to reply for Michael, but we could have never...
Drafted and passed those regulations in those timelines.
But Ms. Jack, all that's required here is a one-paragraph amendment to the existing regulations.
These are shorter than the amendments, than the terms of the economic measures order.
It seems very simple because, you know, you see the drafting of the amendments.
It doesn't seem to be very long.
But the process to pass a regulation, it's not something that you can do in the timelines we had to enact and work on the order.
Commissioner, I think those conclude my questions.
Thank you.
Okay, so I think this is the time for the lunch break.
So we'll take a lunch break and come back at two o 'clock.
The Commission is in recess until 2 o'clock.
La Commission enleve es quatre heures.
La Commission enleve es quatre heures.
La Commission enleve es quatre heures.
La Commission enleve es quatre heures.
Thank you.
Order a lot.
The Commission is reconvened.
Okay, good afternoon.
The first up, I believe, is the City of Windsor.
Good afternoon.
My name is Graham Reeder, Council for the City of Windsor.
I'm going to direct my questions to Mr. Sabia, but I invite input from Ms. Jax and Mr. Mendez, should they be in a better position to respond.
I have some questions about the work the Department of Finance did to assess the economic impacts that was detailed in the department's institutional report.
So your study on the economic impact of the border blockades was informed by figures from Transport Canada indicating that roughly $390 million And you testified this morning that the Department of Finance concluded that the Ambassador Bridge blockade was impacting Canada's GDP as a whole.
Is that right?
Yes.
By roughly $45 million per day over the first week?
That is the estimate the Transport Canada had, yes.
Okay, thank you.
And the Department of Finance concluded that the blockade jeopardized Canada's reputation as a reliable economic partner for the U.S.?
Is that right?
We believe, yes, that the blockade did jeopardize our reputation.
That was based on a number of public statements by officials in the U.S. Thank you.
And the economic...
The policy branch concluded that the impacts would have compounded over time as the blockade went on.
Is that right?
So we believe that the impacts would grow as time went on, as I explained this morning.
Yeah, you gave the example of the food and beverage industry and their inventory, right?
Yeah, and I mean, more generally, I think that the impacts would have spread over time.
Okay.
And the department concluded that the impacts ultimately were likely transitory because the closures were relatively short-lived.
Is that right?
Correct.
And the closures at the Ambassador Bridge were short-lived, you'll agree with me, because the Windsor Police and its policing partners cleared the blockade by February 13th?
I'm not able to speak to the...
The reason that the blockades were shorter or the manner in which they were cleared, but the date accords with my memory.
Would you agree with me that reopening the Ambassador Bridge was key to avoiding long-term entrenched economic damage to the automotive sector, Canada's GDP, and to Canada's reputation as a reliable trading partner?
I think a more prolonged disruption at the Ambassador Bridge would have Done greater damage to our reputation as a good place to invest, our reputation as a reliable trading partner.
So clearing the Ambassador Bridge helped avoid that?
Yes.
And are you aware that after the bridge was reopened on February 13th, police maintained a strong presence in the area?
They erected concrete barriers along the length of the municipal road.
The Huron Church Road between the Ambassador Bridge and Highway 401.
I have some passing awareness of that.
Okay, thank you.
This temporary hardening of the access road to the bridge was implemented to prevent another blockade to the bridge.
Does that accord with your understanding?
I believe that accords with my understanding of what I've read about that, but I don't have any specific information on that.
Understood.
And this would be to avoid, this hardening would be to avoid compounded economic impacts and the risk to Canada's reputation as a reliable trading partner?
Well, as we said in one of our documents, a renewed blockade Would have contributed to escalating economic impacts.
I can't speak to whether or not the measures you're describing were necessary or not.
Understood.
So, Mayor Dilkins, the Mayor of Windsor, testified at this commission that these efforts to protect the bridge had a significant impact on the residents, businesses, and students living, working, and studying around Huron Road and the bridge.
Have you completed any analysis of the impact of the blockade on local businesses and the Windsor economy?
No, we haven't.
Understood.
But you would expect that there would be local impacts that are distinct from the impacts on Canada's GDP, Canada's trading reputation, the auto industry, etc.?
I haven't given that a full enough consideration to give you a good answer, but I would...
I don't disagree with the notion that there would be some impact.
Understood.
Thank you.
It goes without saying that there are significant costs associated with police and municipal actions to clear the blockade and temporarily harden the route to the bridge to prevent further blockades.
Both things usually cost money.
Right.
Thank you.
The Ontario Ministry of Transportation sourced many of the concrete barriers used in the police operations, almost $1 million worth.
The Commission has heard evidence that there was some confusion internally at MTO as to who would be responsible to pay for these barriers and a question as to whether the cost would be paid for by the MTO or others.
And the preliminary thought from the OPP was that the compensation would be through federal funds available to support the emergency response.
to reopening the crossing.
MTO ultimately did not cover the costs of the barriers at the time.
Windsor paid the costs to avoid any delays and has sought reimbursement.
I understand that the Department of Finance has not produced an ex-post assessment of the economic impacts of the blockades.
Is that right?
Yeah, that's correct.
So I'm going to ask the clerk to pull up.
W-I-N-0-0-0-0-2-2-4-4.
And this is a letter from Windsor Mayor Dilkens to the Minister of Finance of Canada and Ministers of Finance of both Canada and Ontario dated March 15. Did any of you see the letter at the time it was sent?
This letter?
I saw the letter, but not immediately after it was sent.
Sometime thereafter.
Okay.
On the third line in the last paragraph of page one, there we go.
It reads, "Since early February, the Windsor Police Service, the City of Windsor, and our partners have experienced significant costs associated with the illegal occupation and the ongoing need to secure Huron Church Road against continued risks." These costs go well above the normal course for municipal operations and are related to the clearing of this international gateway.
The mayor goes on to request reimbursement of these unforeseen costs, stating it would be unreasonable to expect municipal taxpayers to shoulder these costs alone.
In his testimony at the commission, Mayor Dilkens testified that the city had incurred a cost of $5.3 million in response to the blockade.
Are any of you involved in any discussion around allocation of costs incurred to respond to the blockades in general, or with respect to Windsor's costs specifically?
We're not involved in the kind of generalized process that you referred to in the first part of your question, but in the second part, any time we Get a letter of this kind, seeking funding, and I'll let you in on a secret.
We get a few of those.
We have, obviously, those letters, they come from, you know, the mayor of a city of importance of Windsor or lots of other people.
We treat those letters seriously and there is an internal process around this kind of request.
And there will be discussion with with the Minister of Finance about it as that standard for how we treat this kind of thing.
Understood.
And knowing that I'm at the end of my time, I just have a few more short questions.
I think now you're negotiating.
Understood.
Thank you.
In any event, do you agree that the issue of which level of government in response for costs of a multi-jurisdictional response is something that should be planned in advance?
Oh, I'm not sure about planned in advance because the world is a changeable and unpredictable place.
So I'm not sure that this is always possible to do in advance.
But if you're asking me to preempt probably your next question, whether, you know, trying to find some...
Reasonable outcome here involving the city, the province, and ourselves, whether we're open to having some kind of discussion about that.
I mean, I think the answer to that is we're always open to having those kinds of discussions and we'll see where it takes us.
Thank you.
But this isn't the place to work out a deal.
Of course, of course.
My last question was just asking whether or not...
Some kind of advance planning would help avoid potential delays in allocating costs.
It would be if we had advance notice of disruptions of this magnitude.
Of course.
Typically, we don't get advance notice.
Thank you very much.
Those are my questions.
Okay, next call on the government of Saskatchewan.
Good afternoon.
Mike Morris, Counsel for the Government of Saskatchewan.
My questions will primarily be about the Emergency Economic Measures Order, which I'll just call the order and I gather you'll understand what I'm referring to.
Fair enough?
Yes.
Mr. Sabia, the order came into effect on February 15th, correct?
Yes.
And as of February 13th, the Department of Finance was consulting with the CEOs of the major banks about the types of measures that might be included in the order, correct?
Not specifically in the way you put it.
We were exploring, A, their...
Continuing reading of the economic situation and how that was unfolding, and B, what possible solutions could look like or possible actions that could be taken to try, once again, I repeat myself, to bring this difficult situation to a peaceable end.
And that had many forms and there were a variety of options.
The Emergencies Act was nothing more than an option at that point.
Yeah, but fair enough.
You were discussing potentialities that might find their way into the order, correct?
Sure, in the same way that we discuss potentialities that might find their way into all kinds of things, all the time.
And clearly the Department of Finance thought that the input of the bank CEOs was valuable then, correct?
Yes, because for a certain category of actions that the government might or might not decide to embark on...
Would require the cooperation of those institutions as those measures would be implemented.
So conversation with them seemed to us to make sense.
But you'll agree there was no obligation to consult with them under the Emergencies Act, was there?
The Act did not prescribe a requirement that the government consult with bank CEOs before invoking the Act, did it?
No.
That's all I want you to say.
Okay.
Sir, will you agree with me that on the 13th, Cabinet met February 13th to discuss the invocation of the Emergencies Act?
Well, I think that meeting was...
It was broader than just a discussion of the implementation of the Emergencies Act.
There were no decisions that have been made at that point.
That was, to the best of my recollection, a much broader conversation around conditions in the country at the time.
There were reports that were inputs into that meeting from a variety of different agencies across the government of Canada, including national security and others.
So there were a whole variety of things.
But at that point, any input that finance had received from the bank CEOs could have been conveyed to cabinet if it was appropriate, correct?
Well, if you're asking me hypothetically, could that have happened?
I guess yes, theoretically, that could have happened.
Sure.
And Cabinet didn't meet again until February 15th after the Emergencies Act was invoked.
Is that correct?
Well, you need to separate things.
The incident response group...
I just want to know full Cabinet.
Well, full Cabinet, I have to be reminded of the dates here, but full Cabinet, I believe, met on the Sunday evening?
Correct.
I don't have a perfect recall as to the timing of that, but I believe there was a full cabinet meeting on the Sunday evening.
Okay.
I'm going to go to Ms. Jacques now.
Ms. Jacques, in terms of working up the order, did you have the content that you wanted included in it determined as of February 13th from a policy perspective?
I mean, we had been working in the previous week on a couple of options.
One, as we said, with respect to amending the Bank Act.
And the other, when we heard later, much later in the week, that it was possible that the Emergencies Act would be invoked, we started working on a potential order.
Okay.
What I'd like to know is whether the department consulted with any provincial governments about what it was proposing to include in the order before the order was enacted on February 15th.
I certainly did not, nor any member of my teams consult with the provincial government.
Okay.
What about with credit unions?
We did not consult.
What about with insurers?
Well, it depends what you consider consultation.
I had had some informal conversations, but in the previous weeks, with some of the leadership of some of Canadian insurance companies.
Okay.
I actually want to move on because we're running a little slow here.
So I'm going to ask the registrar to pull up a document, CCU.
And this is the institutional report of the Canadian Credit Unit Association.
And I'd like us to go to page three of the report, please.
There will be a bullet point entitled Lack of Clarity Regarding Requirements.
I'll read this for you.
When the measures were first announced, it was unclear to whom the financial sanctions applied.
Eventually, it became clear that the sanctions were aimed at a very small list of individuals and entities.
However, in the early days, there was some degree...
Can you go a little slower, please?
Can you just go a little slower?
I'm sorry.
Yes, sir.
I'm mindful of my time.
There was some degree of panic among some Canadians that their accounts may be frozen due to such things as small donations to the Freedom Convoy.
Can you agree with the statements I've read from the Credit Union Association's institutional report?
Well, I became aware at one point in time that there was some misinformation with respect to small donation.
People thought that donation that had been made prior to the Emergency Act being enacted would be a subject of potential freeze.
Okay, I want to look to the general and technical Q&As that the department prepared and to do that we need to pull up ssm.can.50278.
And I want to go to page 5 if we could with the PDF.
And in particular, question 13. Now, this has to do with insurance.
And I understand this document would have been prepared by finance for answering questions that might be posed to it.
Is that fair?
I have not seen it.
Let me see.
I have not seen the beginning of the Q&A document.
And at the bottom, does it say that it was prepared by Canada of the document?
We can't see it on the screen.
It's one of your documents produced by Canada.
Okay, thank you.
So if we can go back to question 13. Aren't you exposing others to risk if you suspend protesters' vehicle insurance?
And I'm interested in the answer, which is the last sentence.
We expect insurance companies to ensure that third parties can continue to benefit from an insurance payout.
And I'm interested because I see it this way.
Number one, the order directs insurers that they have to cancel insurance policies for vehicles.
But number two, the government appears to be saying it still expects third parties to be paid out by the insurers.
If the insurance is cancelled, how can the insurer possibly do that?
Now, I understand your question.
I do not know when this was prepared.
I suspect that it may have been discussion.
I know there were discussion with various associations, insurance associations.
So I do not know if it's as a result of those discussions that this answer was provided.
But look, I would say as I read this now, I think this is poorly drafted.
Agreed.
Ms. Jacques, as a lawyer, will you agree with me that insurance is a form of personal property?
Well, insurance is...
Sorry, can I just...
Ms. Jacques is here.
She happens to be a lawyer.
She's not here to provide her legal arguments.
Okay.
Just with her own personal knowledge, you know, I agree.
She's not an expert witness, certainly.
But in law, do you understand that insurance can be characterized as personal property?
Sorry, same objection.
Okay, I'll move on.
Were the RCMP consulted about the insurance measures in the order before the order was enacted?
No, they were not consulted.
Were they consulted afterwards?
Afterwards, yes.
Afterwards, okay.
And, you know, my understanding is they were not comfortable.
With the insurance provisions in the order.
Is that your understanding as well, Ms. Jacques?
What I understand is that they made a decision not to share any information with respect to people that own vehicle that were involved in illegal activities.
And I would say that that was, in my view, the right decision.
The purpose, when we drafted the policy and the law, I mean, as we have said many times, one of the intent was to...
Encourage people to leave and stop the illegal activities in which they were engaged.
Right.
I just want to talk a little bit more about what the Credit Unions Association's institutional report states.
It states that credit unions make up 44% of the market share in Saskatchewan.
Can I just interrupt for a minute?
You're going to have to make it.
Short, because you're out of time.
Okay, thank you, sir.
Were you aware of the market share of credit unions in Saskatchewan, 44%?
I think we were very much aware of the fact that credit unions, for long historical reasons, have a substantial presence in Saskatchewan and in some other provinces in Canada.
One last question.
It's a pretty easy one.
You'll agree with me that both credit unions and insurers are provincially regulated, correct?
Yep.
Thank you.
Those are my questions.
Thank you.
Next, call on the JCCF and Democracy Fund.
Good afternoon.
Good afternoon.
I'm Hattam Kier, Counsel for the Justice Center for Constitutional Freedoms.
And given the subject of my questions, my questions will be for you, Ms. Jacques.
So, first of all, at the risk of stating the obvious, this was unlike anything else your office had to deal with, right?
These were not ordinary events.
That is accurate.
Right.
And so essentially what your office was tasked with was a way, at first anyways, was to look for ways to use existing legislation or regulations to respond to the situation at hand, right?
Yes, we wanted to see if we had any tools in place that could be useful.
Right.
From a financial perspective.
The need to respond arose in response to the massive amount of money that was coming in to support the convoy, right?
Well, certainly that triggered our interest.
As people were starting to donate via crowdfunding platforms, we were looking at that.
But it was to support what was a peaceful event.
Now, we heard from Ms. Leach that the amount of donations took her by surprise.
I imagine that they probably took you and your office by surprise as well, right?
Well, at the time when we found out, I suppose it was maybe surprising, but we were right in the middle of budget at the time when we just basically read news articles that were incoming.
Tell me if you agree, but I'd go so far as to say that the amount of people donating to the crowdfunding sites was shocking, right?
Especially as it was just coming in from the news?
Well, I couldn't tell you how many people donated because you can't tell the size of the donation, so...
But, I mean, the amount were substantial amounts, yes.
Okay.
And now, essentially, in trying to see what your office could do, you found that there was a gap in the legislation and that you didn't have the tools that you needed, right?
Well, as we said, we knew that in the past from work with international association organizations that, you know, crowdfunding platforms and some, most payment service providers were not captured by the legislation.
Okay.
And the legislation you're referring to is the Proceeds of Crime, Money Laundering, and Terrorist Financing Act?
That's right.
Okay.
And now, the problem wasn't...
So, okay, you said that it doesn't apply to crowdfunding sites, or it didn't, but it does apply to banks, right?
Yes, it does.
So, once any money from the crowdfunding site got paid into a bank, it would then be under the purview of that legislation, right?
If it was paid to the bank, yes.
Yeah.
But even then, the Act still wasn't used in response to any funds received by the banks, right?
Well, I mean, the Proceeds of Crime, Money Laundering, and Terrorist Financing Act applied at the time.
So if information was being provided to FinTrack, I wouldn't have known about that.
So it's possible that information was being shared.
I do not know.
But part of the reason that that act wasn't helpful, even for the funds being paid into the bank, was because this wasn't terrorist financing.
Again, I can't say that.
I do not know what information was shared.
FinTrack would know if any information at the time had been shared with them.
Okay, well, let's look at it from the perspective of what your office was working on.
So, the emergency economic measures prohibited...
A whole list of activity that basically amounts to providing funds to designated persons, right?
That's accurate.
And designated persons were people who were engaging in an assembly that was prohibited by the emergency regulations?
Yes.
Unlawful Act.
Yes.
Activities.
Yes.
Well, specifically under the emergency regulations to participating in a certain kind of public assembly, right?
Yes.
Okay.
So, I mean, this is identifying a new category of conduct that these...
That this kind of approach is now being applied to, right?
This wasn't conduct that was previously been done.
I suppose we were not engaged in drafting the regulations.
So we were engaged in what became the Economic Measures Order, but not the regulations.
But then the Economic Order works based off of people who are identified in the regulations.
Of what is described as...
As you, I think you were just saying, illegal activities.
Let me see.
You'd have to bring me the, you know, we didn't work on those regulations.
So which section were you referring to?
So section one.
I believe, of the emergency economic measures identifies a designated person, right?
And that's someone who's committing something identified in sections 2 to 5 of the regulations?
Correct, yes.
Okay.
So, I mean, the activity that's identified in sections 2 to 5 is not activity that was previously captured by the Proceeds of Crime, Money Laundering, and Financing Terrorism Act.
No, but I don't see the link, I must admit.
Sorry?
I'm not sure to see the link.
What is your question?
Basically that the money-freezing provisions of the economic order, to refer to it as that, is now being applied to a new category of people that wasn't previously captured by the Proceeds of Crime Act.
Well, I mean, all that that did was to extend the...
So under the PCML TFA, the only requirement was nothing was changing in the Act other than to extend to crowdfunding platform and payment service provider the obligation to register if they were in possession of property that were owned by those designated people.
So it was a very narrow application.
Okay, but what I'm trying to get at is that that category of designated people, There wasn't an equivalent under the Proceeds of Crime Act?
Not to my knowledge, no.
Okay.
So, then, now, in terms of what your office was doing prior to the use of the Emergencies Act, I imagine it must have been rather frustrating, then, in terms of the lack of tools available to respond to the situation?
Well, no, not frustrating.
I mean, we're trying to help, you know, all departments, we're trying to help to find solutions.
Okay.
And at that time, You guys didn't have the tools needed to stop the donations from coming in, right?
Well, it's not to stop donations.
That was not the purpose.
But certainly, I mean, we didn't have the tools to direct, you know, financial service providers to review their relationship with their clients or to freeze bank accounts.
And certainly, we didn't end the act.
Proceeds of Crime, Money Laundering, and Terrace Financing Act did not apply to a crowdfunding platform and certain payment service providers.
I'm sure you're aware that FinTrack does not have enforcement authorities.
Right.
But my question for...
So perhaps you can take a step back.
I remember in the testimony in chief, it was identified that there were two goals to the emergency economic order.
Yes.
It was to...
The one was to cut off the flow of support to the protest, and then the other was to put a deterrent pressure on protesters, right?
Correct.
Okay.
So in terms of that first goal, essentially the way that support was coming in was through donations to crowdfunding sources or cryptocurrency wallets, for example.
Yes.
Okay.
And I mean, we heard from...
Previous testimony a couple weeks ago that it basically cost thousands of dollars in fuel to get a big truck across the country.
And so that was one of the things that those donations were going to, right?
Fuel?
That's what I heard in the news.
Right.
And food and lodgings?
Again, I have no personal knowledge, but yes, I read that.
Okay.
And would you agree that essentially the people who are making these donations, they're doing that because that's their way of supporting the protest?
I would imagine.
Right.
So these people couldn't go to Ottawa themselves, and this was their way of participating in something that they believed in.
I suppose so, yes.
So, I mean, at the end of the day, really what the goal here was a way to prevent Canadians from expressing their support in a protest against a policy they didn't believe in.
I don't agree with that.
I mean, people can make donations and kids still make donations.
The only restriction that were imposed was to support.
Right, but yesterday Mr. Ozofsky and today Mr. Sabia both said that the activities were made illegal by the emergency measures.
So up until that point, people were donating to support a protest.
Yes, and the measures were never...
The application of the Emergencies Act was always from the date prospectively, not retrospectively.
Right, but the collective...
So that it only captures a donation that is going to then...
Sure, but would you agree that the collective function of those two regulations and the order was to take a protest, declare it illegal, and then prevent funds from coming in to support the protest?
I think the objective was to try to bring, as I said before, to a peaceable end, a set of activities that were had then been declared illegal.
And the objective was to try to bring that disruption for all the reasons we discussed earlier this morning that I won't repeat, to bring that to a peaceable and timely end.
I see I'm out of time, so I will just wrap up with this one point, Ms. Jacques.
At the end of the day, that first goal, that first goal of preventing funds from coming in to the protesters, it wasn't even needed, was it?
Because the...
TD Bank had already put a hold on the funds that were held with them, correct?
Well, at the time, you know, we didn't know what was happening with TD Bank for sure, but it doesn't mean that because there's, let's say, actions taken in one place that money will not be funneled through other ways.
I mean, money is fungible.
Right, but you are aware that the, and it's identified in your organization's institutional report, that the Ontario Attorney General had obtained a restraint order against any funds that were held by Ms. Leach, Mr. Guerra, or Mr. Dicker.
But that only applied in Ontario, and that's the whole point.
Because money's fungible, as Isabel says, it can flow anywhere in the country, so one provincial government taking action doesn't resolve the issue.
The issue for the national government was trying to do this on a broad-based approach because that's the way you contain a situation where money can flow anywhere, which it does all the time.
Where are you getting the basis that the restraint order only applied in Ontario?
It was made by the Superior Court, was it not?
I think it was just in the province of Ontario, was my understanding.
I'm not a lawyer.
I may be wrong about that, but I thought it was with just application in Ontario.
I am over time, so those are all my questions.
Thank you.
Thank you.
Next, call on the government of Alberta, please.
Good afternoon.
For the record, my name is Stephanie Bose for the province of Alberta.
Just one area I'd like a little bit of clarity on.
Do the assessments of economic impact of the Coutts border blockade take into consideration commercial traffic that would have normally traveled through that port of entry but was rerouted to other ports of entry?
So we tried to implicitly take account of that, but it's not explicitly modeled, but it is...
We assume basically...
A similar amount of rerouting as what we were seeing at Ambassador.
Okay, so all those estimates were based on what you were seeing at Ambassador Bridge as opposed to specific data from Alberta?
Yeah, so we took what we were seeing at Ambassador Bridge and scaled it by the amount of trade crossing at Coutts to get a rough estimate.
So it doesn't specifically, explicitly model the rerouting at Coutts.
All right.
Thank you.
That's my only question today.
Thank you.
Next, the Ottawa Coalition.
Good afternoon, Commissioner.
Good afternoon, panel.
My name is Christine Johnson.
I'm counsel for the Ottawa Coalition of Residents and Businesses, and I just have a few hopefully short questions for you today.
To begin, I would ask for the clerk...
to please pull up a document.
It's document ssm.can.401319 _rel.0001.
And while we're waiting for that to be pulled up...
Oh, here it comes.
So, I was hoping that, and this is a question for anyone on the panel who might be able to give assistance.
I'm wondering if any of you might be able to assist me in understanding this document.
So, this we see at the top, it's an email sent February 14th.
We see the from and to information adapted as personal information at the top, but if we scroll to the bottom of page two.
We see that this email originated from someone in the office of the Deputy Prime Minister and Minister of Finance.
And we can go back up to the top please, Clerk.
So my understanding of this email is that it is an email communicating information about the names of 201 trucking companies.
Whose trucks were identified as participating in the convoy demonstrations in Ottawa.
The email then shares which of these 201 companies accessed the CEWS, which I understand refers to the Canada Emergency Wage Subsidy.
And the email goes on to note that 45 of these 201 trucking companies were identified as accessing that subsidy.
So my question for the panel is just whether any of you were aware that this information was being compiled within the department and then for what use is my question.
I am not aware.
Of that, and that is the first time that I've seen this document, and seems like if you want to pursue that, it's best to pursue that with the Office of the Minister.
Thank you.
That's fair.
And for the record, I'll just note that the document attached to this document is...
SSM.CAN.401320.
But of course, we don't need to pull it up in light of the panel's answer.
So I'll just move to another brief area, which I'm sure you can provide me some assistance.
This is with regards to clarifying.
Some of the evidence that you provided regarding the aggregate data that the department received about the frozen accounts pursuant to the order.
Mr. Sabia, you told us that approximately 280 accounts were ultimately frozen.
And for your assistance, I believe that's the number that's also contained within your institutional report.
Is that correct?
Yes.
And those were accounts frozen between February 15th and February 24th, correct?
Well, I think it's a shorter time period than that because I think on February the 21st, I have to check the date, 21st or 22nd, the RCMP had indicated to the banks, given the progress on ending the disruptions, That all those accounts should be unfrozen.
So it was really in a period from the coming into force of the Emergency Act on the 15th and say the 20th or 21st of February.
Right.
Fair.
And we've heard you also also give evidence that to the department's knowledge.
No donors had their account frozen.
So those 280 accounts were not donor accounts, but they were more people who were leaders of or instrumental in some way in the protests.
Well, that's our understanding.
I mean, we were not involved and don't have individual-level information here, but that is our understanding.
And financial service providers told the department that those accounts, again, those 280 accounts, Represented different financial products.
For example, the savings accounts, checking accounts, credit cards or lines of credit, correct?
Yes.
So to be clear, the total number of individuals or entities who had accounts frozen under the order was in all likelihood far, far less than 280 because those 280 accounts may have been multiple accounts held by individuals or entities, correct?
Yes, that's correct.
It would be much smaller, I believe.
And to perhaps assist with that, Clerk, I would ask you to pull up document SSM.CAN.50209 _REL.301.
And I believe my friend from the CCLA already took you to this document today.
And Ms. Jacques, I'll point out that if we scroll to the bottom of page one, we see an email from you, Ms. Jacques, to Alex, and again, I believe this is Alex Lawrence, and you say on February 22nd, the RCMP has confirmed that they provided the banks with a list of 57 individuals, entities.
Representing a total of 240 financial accounts that are no longer involved in the blockades, and you go on to know that the banks have confirmed that they'll be unfreezing these accounts.
These numbers, so we see 57 individuals or entities corresponding to 240 financial accounts.
So is this the type of ratio that we're looking at when we're looking at the overall 280 accounts that were frozen?
It was likely of this nature, this kind of ratio.
That's accurate.
Thank you.
Those are all my questions.
Okay, next I'd like to call on the Windsor Police Service.
Thank you, Mr. Commissioner.
My name is Tom McRae IAC for the Windsor Police Service.
Mr. Sabia, my notes of your evidence say that your evidence was that this was a serious issue and the Ministry of Finance was working towards a peaceful end to difficult circumstances.
Is that a fair summary of your earlier evidence?
Yes.
Thank you.
I also have notes that you said That a peaceful end is better than a non-peaceful end, and in that context you acknowledge the right to protest.
Is that fair?
Yes.
Did anyone at any time in the Ministry of Finance, to your knowledge, model the cost of a non-peaceful end to the protest?
No.
Okay, thank you.
Those are my questions.
Thank you.
Next call on the Government of Canada.
Good afternoon.
It's Stephen Aylward.
I'm one of the lawyers for the Government of Canada.
Mr. Sabia, earlier this morning, you mentioned a concern around the electric vehicle credits in the context of discussions with or issues with the United States.
I just wonder, for those who may be unfamiliar with that issue, if you could just explain a bit more about what it was and why it was a concern for you.
Sure.
In the U.S. legislation since passed, there had always been a certain level of subsidy for electric vehicles.
And that level of subsidy, one way or another, was matched because they were quite small on the U.S. side and on the Canadian side.
The proposal was a dramatic increase in the level of government subsidy for electric vehicles that were assembled.
Only in the United States.
It is a dramatic increase.
So the issue for us was that if that remained the case and that electric vehicle assembly was done on an American basis, not a North American basis, then the Canadian industry would be at a very, very substantial disadvantage and that, in effect, we would either...
As a much smaller country, have to match the magnitude of those subsidies or have, in effect over time, the automotive industry migrate into the United States.
The automotive industry, you know, is an extremely important part of the Canadian economy and an essential part of the central Canadian economy.
So finding a working toward a North American approach.
To the Assembly of Electric Vehicles was something that was very important to us and to those companies and especially to auto workers.
So that's why the concern that was being expressed in the United States that Canada is no longer reliable raised such a serious issue for us because if that was the political perception, then...
Then our chances of being able to convince Washington to adopt a North American approach to this, which of course required a level of confidence that auto parts and cars could move across the border pretty seamlessly.
If we were not successful in doing that, then as I say, there would be a very severe economic consequences for, I mean, there are 500,000 workers in Canada, directly and indirectly, whose jobs depend on, I mean, it's a very, very important sector.
Was that issue around the proposal to have the electric vehicle credits subsidies apply only in the United States?
Was that a live issue in the United States?
Yes.
At the time?
Yes.
Mr. Mendez, you mentioned that there had been issues with semiconductor supplies in the supply chain in the auto sector.
That had arisen prior to the blockades.
Did the impact of the semiconductor shortages apply equally in Canada and the United States on the auto manufacturing sectors?
Actually, there was evidence at the time that given that the semiconductors had become scarce, there was a need to make choices about where.
And to which auto plants, semiconductors were being allocated.
And my recollection is that they were disproportionately being allocated towards plants in the US.
So it was affecting Canadian plants to a greater degree.
So, as we know, the Ambassador Bridge was—the blockade was cleared by the time the Emergencies Act was invoked, but we've also heard evidence that there were plans from protesters to try and re-establish a blockade on the bridge.
Just wondering for your perspective in terms of impacts—economic impacts or impacts with the U.S. trading relationship on what would have been the impact of a blockade reemergence Well, I think because our concern at the time was not only with respect to the Ambassador Bridge.
Concern at the time was that while a disruption may have ended in one place, there was certainly the very live possibility that disruptions could emerge elsewhere or, in fact, at that same bridge.
We had no reason to believe that those disruptions had come to an end, period.
At the time, prior to the time of the government's decision with respect to utilizing The Emergencies Act.
And indeed, that was one of the significant factors, that there was no way of judging whether we could find ourselves in a situation of kind of rolling disruptions across various border points of entry.
Had that occurred, and had we been unable to manage that situation, I think the reaction in the United States, in the politically important state of Michigan and in the federal government, would have been to very seriously question Canada's ability to continue to act as a reliable trading partner.
Can I just add that, you know, in a situation where the Ambassador Bridge became blocked again, you'll note that The estimates that Transport Canada did were for peak impacts in the first week of a disruption.
Given that inventories had been drawn down during the period of disruption, a return to a disruption at the bridge would have put us more into like a second week situation where, based on our own past experience and discussions with Transport Canada, You know, that could reasonably be up to like three and a half times the size of the impacts that we were discussing for the first week.
In week two compared to week one.
Yeah.
I'd just like to add something here.
You know, we talk about 0.1, 0.2 and the impact on growth rates and this and that, and we talk about it in very antiseptic terms.
But what we're really talking about here is, you know, that we are already experiencing it.
We're really talking about what does it mean, 0.1, 0.2?
It's not just a number.
It means layoffs.
It means lower incomes for workers.
It means communities less able to count on certain companies.
I mean, there are real human consequences to these numbers, whether it's an autoworker or whether it's someone in the food sector in Western Canada and their ability to pay mortgages, etc.
I mean, we had a lot of conversation today about those who are involved in the disruptions themselves.
But there's also a dimension of this about, well, what are the rights of the people who suffer the economic consequences of this kind of disruption?
Because they are real and they are meaningful.
Can I ask, you testified earlier that this was an urgent situation.
We had to act quickly because there was...
The longer it went on, the worse the economic impacts could have been.
But just when you say quickly, what's the timescale that you had in mind?
Was this an issue of days or weeks, or what was the timeframe?
Well, I think in an ideal world, these disruptions had already gone on.
They varied the length by where they were in the country.
But these disruptions had already gone on for a reasonable period of time.
Reasonably lengthy period of time.
So our objective here was we were thinking about this in a period of several days or a week, perhaps a bit more than a week.
But what we very much wanted to avoid was what Reese just said, particularly with the automotive sector, where once inventories were down, then the cost of this thing on a week-by-week basis would really escalate.
And that's what we wanted to avoid.
As it happened, we were able to avoid it, and therefore, the economic effects and the long-term scarring of all of this was quite limited.
But that's because it was ended quickly.
Changing gears here slightly, Ms. Jacques, you mentioned to my friend from the government of Saskatchewan that...
The Department of Finance hadn't consulted with RCMP on the EEMO until after the measures were adopted.
Did the Department of Finance consult with Public Safety on those measures before they were adopted?
Yeah, we had discussion with Public Safety before the measures were enacted, yes.
Now, my friend for Commission Council put it to you that the Department of Finance Took no responsibility for whose accounts were frozen and the exercise of identifying whose accounts were to be frozen.
Does the Department of Finance have any information about the individuals who were involved in the blockades or did it have such information at the time?
No, we did not.
Did it have any way of obtaining that information?
No, and it would have been inappropriate for us to.
Why do you say that?
Because we should not have, in the interest of protecting people's privacy, we should not have access to that information.
So who would be the appropriate body through which such information should flow?
It would be law enforcement.
Pardon me?
Law enforcement.
And in fact, Commission Council showed you the evidence of Officer Beaudoin, the disclosures that were, the form of disclosure that was made.
To financial institutions.
If a financial institution was uncertain upon reviewing a disclosure it received from the RCMP about whether the person who was the subject of the disclosure was in fact involved in illegal activity, was there anything that would have prevented the financial institution from requesting that the RCMP provide further information?
No.
Actually, we have measures so that...
To ensure that information could be exchanged between the RCMP and financial institutions.
That's Section 6 of the...
Yes.
And in terms of the...
Oh, are you aware of any instances in which there was a case of mistaken identity in which a person had their bank account frozen despite not being someone who was involved in the protests?
No.
In terms of the decision to use what my friend called a hybrid approach, not providing financial institutions with a list of designated persons, but also depending on their own systems.
Ms. Jacques, you testified earlier that that was in part to take advantage of the internal systems and algorithms that those institutions have in place themselves.
What sort of data would financial institutions have access to that the RCMP or law enforcement wouldn't?
That would allow them to make determinations about whether someone was engaged in illegal activities under the emergency measures regulations.
Well, I think banks and financial institutions on a regular basis use their algorithm to, you know, detect fraud, you know, for example.
Fraudulent activity in credit cards or bank accounts, even important withdrawals.
So on a regular basis, they have tools to detect these activities and to freeze either the bank account or the card pending resolution of the inordinate activities on the account.
They'd be looking at the transaction data that was available to them.
That's right.
And so if a person donated a million dollars to support I presume that that would be possible, yes.
Especially such a large amount.
Which is, of course, why, just to complete the thought, a combination of these two things, information from law enforcement and utilizing the pretty sophisticated technological Abilities of financial institutions is the way to maximize the accuracy of these actions.
And accuracy matters here for obvious reasons.
So we think actually that you described it as a hybrid approach.
That kind of hybrid approach actually delivered a good result.
And so if the list approach had been used and financial institutions were required to freeze the accounts of anyone who was on a list provided by the RCMP, Is it fair to say that the financial institutions wouldn't have been able to unfreeze those accounts until they were delisted by the RCMP?
That's correct.
And so under these measures that you had in place, using the hybrid approach and the duty to determine on a continuous basis that you referenced earlier, financial institutions were actually able to unfreeze accounts without waiting for such a delisting.
Is that right?
Absolutely, and that was an important part of the policy work we did.
We wanted to ensure that financial institutions had an ongoing obligation to review the information that they had, specifically for that, so to ensure that they can freeze or unfreeze accounts based on the information that they have.
In terms of the national scope of the...
Emergency economic measures order.
It applied across the country to financial institutions and designated persons, not just in provinces where border blockades or other unlawful protests were occurring.
Why was it important that the measure apply across the country?
Well, it's very important because, you know, we didn't know who was donating and which province to where.
Also, I mean, we had heard that funds were coming from outside of Canada.
So if funds are coming in, we don't know where it's going to come in Canada and where it's going to go.
So it was very important that as money flows that we could have a consistent approach across the country and ensure that the funds that were used to support those illegal activities were frozen.
In terms of notice of the pending freezing measures, Mr. Sabia, you mentioned earlier that the Deputy Prime Minister had been very clear that individuals could have their accounts frozen if they continued to participate in unlawful activity.
How was that message communicated?
I think the minister made that comment relatively early in the day on the 14th, although I don't remember the time.
In the context of a broader news conference, I think in the company of the Prime Minister, announcing the government's intention to put in place the Emergencies Act, it was also very, very extensively picked up and reported in the public media through the course of that day and evening.
And Ms. Jacques, you mentioned a notice that had been given to...
Are you aware of efforts taken by police officers to give notice to protesters of these potential consequences?
Yes, we have been informed that the RCMP had been informing people, certainly on the Hill, I don't know elsewhere, that the freezing of bank accounts were a possibility if they were leaving the location where they were at.
And there's lots of anecdotal material that we heard subsequently of RCMP officers or other officers speaking to truckers or other people who were protesting, saying, with giving protesters the opportunity to say, look, I am leaving, I'm leaving, you know, tomorrow, etc.
And as I understand it, in those cases...
Law enforcement authorities were quite flexible as long as they had an undertaking that the person was leaving.
They did not take the further step of then freezing that bank account.
So I think there was quite a lot of good common sense in how this was applied and gave people the opportunity to, you know, just go home.
Ms. Jacques, when the measures were conceived, how What was the idea for how someone would have their account unfrozen?
Well, it was again two-fold.
I mean, it could have been just based on a person, a set person leave and ceases the illegal activity, could contact the bank and tell them that they were no longer involved and that they were no longer on location.
Or a person could have gone maybe to the RCMP and industrial law enforcement to ensure that the information was conveyed to the financial sector.
The definition of a designated person under the EEMO is a person who is engaged in activity, contrary to sections 2 to 5 of the EMR.
Am I right that a person would cease to be a designated Yes, that is accurate.
As soon as a person ceases the activity, the account could be unfrozen.
So as quickly as we could freeze, the account could be frozen.
it was easily unfrozen.
My friend for the...
CCF suggested to you that the intention here wasn't to freeze people's grocery money.
Was there any way that the Department of Finance in conceiving these measures would have been able to distinguish between money that was being used to buy groceries and money that was being used to fund illegal activity?
No.
And why is that?
Well, we don't have that detail of information.
It's impossible, and it was difficult for us to draft a measure in such a way.
Mr. Commissioner, I'm just about out of time.
If I might have another two minutes?
Sure, go ahead.
Thank you.
In terms of the alternative measures, or the alternatives to these measures, it was suggested to you earlier that the Some of the crowdfunding campaigns were already subject to a court order from Ontario at the time that the EEMO came into effect.
And Mr. Sebi, you noted a concern around whether that order would apply outside of Ontario.
I'm wondering, Ms. Jacques, from your perspective, were you aware of any other reason why it was needed to take?
These steps, why the Ontario order was insufficient?
Well, I mean, the Ontario order was one circumstance, but it was for us, you know, there was always a risk that funds could be given to another crowdfunding platform using other payment service providers.
Money, you know, as we said, can be flown from different ways, could have ended up in wallets.
I mean, we did not know at the time.
So the fact that...
It was one court order doesn't solve the situation.
So it was important that we take the measures we took.
You've heard of Wallace.
You're referring to cryptocurrency fundraising.
That's right.
Can you say more about that?
Well, I mean, we were aware that some money were being flown to cryptocurrency wallets.
And so we wanted to ensure that that was captured as well.
I'm just about out of time.
You're aware that there was significant media reporting around the GoFundMe decision to cease the crowdfunding campaign on that platform?
Yes, I heard about that.
Okay, and I don't have time to play it, but I'll just, for the record...
One example of such a media report would be pb.can.401797 _rel.0001, beginning at five minutes and five seconds.
Thank you, Mr. Commissioner, for the indulgence of those are my questions.
Okay, thank you.
Any re-examination?
Thank you.
Just very briefly, Mr. Commissioner.
Presumably primarily for you, Mr. Sabia and you, Ms. Jacques.
As you might know, the Commissioner has a mandate to look into the future and make recommendations about the lessons that have been learned and if you can contemplate for a minute the lessons that the Department of Finance has learned and in particular from the Steps that were taken with the financial institutions.
Now, we heard evidence from both of you, Mijak, the very short period of time within which you had to draft these regulations and from you, Mr. Sabia, the very short period within which you had to consult with all sorts of other outside institutions to see if you could make these work.
And we'd heard earlier from the RCMP about how quickly they had to move as well.
Looking to the future, I'm wondering if the Department of Finance would consider it useful to have a sort of protocol in place in case this type of situation arises in the future about the factors that you would take into consideration if you had to move very quickly again in the future to take similar steps.
Certainly, as we mentioned before, if we would have more time to draft and craft the policy at the time, maybe to provide from specific exceptions for some sum of money for the freezing of the bank accounts, maybe that is something that we would have done.
Certainly, with respect to...
The list of designated persons, as it was mentioned, I mean, I know that although there was no provision for listing, effectively the RCMP provided a list of persons to financial institutions.
I mean, that's something that we can think about, but we also do not want to lose the capacity of financial institutions to do their own verification.
I think that is still key, so maybe it's something that we could think about as to how we create.
This procedure to share a list.
But we'd have to think about that further.
So, for my part, look, you always learn from experiences.
And this was a highly unusual experience.
And as an organization...
Speaking on behalf of the Department of Finance, as an organization, I mean, we would be misguided not to try to learn from it.
I think we did what we needed to do in very compressed periods of time, and I think just history.
I think the record shows that we were able to, in taking the actions that we took, we were able to...
Minimize the damage to the national economy.
And that means, I want to emphasize this point again, that means minimizing the damage to people.
It's not antiseptic stuff, and it's not just about companies.
It's about people.
It's about workers.
It's about paychecks.
And we ought not to lose sight of that when people like us talk about, you know, point one and point two.
It's about people.
So, given that...
Yeah, can we do things like think through protocols of activity?
If these very unusual circumstances were ever, and I hope they never do, arise again, and would we be better positioned if we had thought through in advance protocols of exactly what to do and when to do it and with whom to consult?
Now, circumstances vary, so who you're going to consult with varies.
But could we...
Could we make that better?
Sure, because you can always learn.
And we're open-minded about that, and we will.
But again, I won't say more on this.
I'll just say in the circumstances, and I think the record shows this, we were able to avoid some potentially very, very serious consequences for, in effect, millions of people who could have been affected by this.
Thank you.
And thank you, Mr. Commissioner.
That's my only re-examination.
Okay.
I'm going to maybe wade in a bit further on the last question about reforms and looking forward and ask you to go up a bit to the Emergency Act itself in the sense that they're...
There may be debate, let's put it this way, as to whether or not the concerns you've expressed today are encompassed by public order emergency, i.e.
the financial impact that you've described.
So my question is, do you have any recommendations or suggestions on the Act itself?
Whether clarity on that issue, assuming you believe it ought to be considered, is useful and how that might be done or whether your financial concerns of that type are another kind of emergency other than a public order emergency.
I don't know if you understand what I'm getting at because it's encompassed in one right now and there are some readings that would...
Not encompass a financial impact such as you've described.
Well, Commissioner, you're going to get a biased answer.
No, and that's fine.
Because my biased answer is, for all the reasons I just said, economics is not about economics, it's about people.
And it's about the welfare of people.
So, one way or the other.
And you're in a much better position than we are to decide whether or not it's in public order or some other category, etc.
I won't venture into that world.
You're much more experienced and I would be impertinent to venture review on that.
But do I think threats to Canada's national economy warrant being taken very seriously and integrated somehow?
In these kinds of legal structures, my answer to that is unambiguously yes, just because they are of the importance that they are to people.
So my answer is yes.
And if there's ambiguity around those issues, then clarifying, I think, that ambiguity would be a very useful thing, if there is ambiguity.
No, and I'm not saying there is.
I'm just...
Trying to get clarity in your position, which biased as it is, I think it has value and appreciate that.
And so I think that's all I'm going to ask you.
So thank you very much for your testimony and for coming and for taking the time to give us the Finance Ministry's view.
Thank you.
Okay, so maybe we'll take a short break while we set up for the next, it's not a panel, I guess, but the next witness.
So we'll just take five minutes and come back once they're organized.
The Commission is in recess for five minutes.
La Commissão é leve por cinco minutos.
La Commissão é leve por cinco minutos.
La Commissão é leve por cinco minutos.
Order alert.
The Commission has reconvened, the Commissar Appra.
Thank you.
Okay, go ahead.
For the record, Shantona Choudhury for the Commission.
Our next witness is Ms. Jody Thomas, the National Security Advisor to the Prime Minister.
I would ask the witness be sworn or affirmed.
Ms. Thomas, will you swear on a religious document or do you wish to affirm?
On a religious document, please.
We have the Bible, the Quran, or the Torah available?
Bible, please.
For the record, please state your full name and spell it out.
Jody Hazel Thomas, T-H-O-M-A-S.
Do you swear that the evidence to be given by you to this commission shall be the truth, the whole truth, and nothing but the truth?
So help you God.
I do.
Thank you.
Good afternoon, Ms. Thomas.
Thank you for being here.
We'll just start with a couple of housekeeping matters.
First of all, you'll recall participating in an interview with Commission Council on August 30th of this year?
I did.
And you'll recall that some of your colleagues who are not here today, namely Assistant Secretary Michael McDonald and Assistant Secretary Martin Green, also participated in that interview.
That's correct.
Okay.
After that interview, Commission Council prepared a summary of the interview.
For the record, I don't think we need to pull it up, Mr. Clerk, but for the record, it's WTS 5071.
So, Ms. Thomas, I'll just ask you to confirm that you've reviewed that interview summary and that it's accurate to the best of your knowledge and belief and that insofar as it contains the information of your colleagues, they have also reviewed it and confirmed it is accurate.
That's correct.
Okay.
The second little housekeeping matter is the institutional report of the Privy Council Office, affectionately known as the PCO.
So you're aware that the PCO filed an institutional report with the Commission?
I am.
And you've reviewed it?
I have.
And it's accurate to the best of your knowledge and belief?
Yes.
For the record, that's DOJ IR 6013.
Ms. Thomas, I'll ask you to just start by telling the Commission, what is the role of the National Security Advisor to the Prime Minister?
So the National Security and Intelligence Advisor to the Prime Minister is a position that was created after 9-11 in order to coordinate and bring sort of structure to the national security community, which is a group of very independent departments with independent deputy heads, although they all...
Work together in a horizontal manner.
And what was learned after 9-11 was that coordination amongst these departments and agencies is useful in understanding intelligence, national security, and foreign policy issues.
And so in my job, what I do is I do coordinate the national security community.
I have a convening function, which means I can call them to meetings.
I can raise questions.
Challenge them on certain issues.
So I have a challenge function like all Deputy Secretaries at the Privy Council Office.
And I also provide advice and information and brief the Prime Minister of Canada.
Okay.
And when you speak of the national security community and the various departments and agencies, who are you speaking of specifically?
The Department of National Defence, Global Affairs Canada, Public Safety and its Agencies, CVSA.
CSIS, RCMP, and the Canadian Security Establishment, the Communication Security Establishment, known as CSE.
Those are the primary players.
Okay.
And within the secretariat, well, I believe there's four separate secretariats, three or four secretariats that were within the National Security and Intelligence Advisory.
Can you tell us about those?
That's correct.
There are four secretariats.
So the newest is the Emergency Management Secretariat, and it was created in November 2021.
And then the Foreign Policy and Defense Advisor to the Prime Minister reports through me.
The Assistant Secretary for Intelligence Assessment, which is Martin Green, and then the Security and Intelligence Secretariat, which is the job done by...
Led by Mike McDonald.
Okay, so they all report to you, and you in turn report to who?
The Prime Minister and the Clerk.
And the Clerk of the Privy Council.
Okay.
Can you tell us a little bit about the communication channels there?
So you report directly to the Prime Minister.
What's the briefing method?
What's the reporting relationship there?
So any written brief or advice that goes to the Prime Minister goes through the Clerk.
I sign it off as the National Security Advisor, but she also reviews it and signs it before it goes to the Prime Minister.
Verbal briefs, cabinet briefs, discussions with the Prime Minister, the clerk is in the room, normally, and she's certainly aware of what I'm discussing with the Prime Minister.
I don't call him directly.
I haven't had to.
The environment that we have been existing in.
Generally, the conversation, anything I need to get to them, I go through PMO or through the clerk.
And I understand that you assume the role of National Security and Intelligence Advisor.
I'm going to say NSIA.
We all hate acronyms, but that's a mouthful.
Shortly before the events of the Freedom Convoy, is that right?
I became the NSIA on January 11, 2022.
And where were you before then?
I was the Deputy Minister of National Defence.
How long had you been in that role?
Since November 2017.
And what was your background before that?
I was the commissioner of the Canadian Coast Guard, then the deputy commissioner of the Coast Guard.
So I've had 35 years of experience in the federal government.
So you mentioned that...
You have a convening role between all of these various agencies, the national security community, as you call them.
We heard earlier this week from your colleagues at Public Safety, and they described their role as being a consumer of intelligence as opposed to a collector of intelligence.
I understand the same is true of PCO.
Yes, that's correct.
Can you elaborate on that a little bit, where the sources of your intelligence come from?
The sources of intelligence from...
Covert and overt, so open source, but also what's collected by the agencies, comes from CSIS, RCMP, CSE, Global Affairs Canada, and the Foreign Intelligence Secretariat, and Canadian Forces Intelligence Command as the primary domestic agencies.
We also hear from our Five Eyes colleagues.
So we hear from the United...
We get intelligence that we read and consume and analyze, assess from Australia, the UK.
New Zealand and the US.
We also receive open source and review open source information from academics.
We look at social media to some extent, not as much as we should.
We do about certain incidents, but we don't do social media scraping, as an example, and that will later become an issue that we talk about.
So primarily the information, the intelligence we receive, we receive domestically, but we have links around the world.
Okay, and if I can ask it colloquially, when you get it, what do you do with it?
So I read raw intelligence, but the Intelligence Assessment Secretariat assesses it.
It looks at trends.
It looks at implications for Canada.
If intelligence is actionable, meaning we receive a piece of intelligence that says something could happen, what do we do with that?
They do that kind of assessment, reaching out back to those departments to ensure...
That there is a global view of what this intelligence means for Canada and for our allies.
Do they produce assessments, certain products of intelligence?
And if so, how are those disseminated, dispersed?
What's done with them?
They do multiple kinds of products.
They do longer-term vision products.
We see a trend coming.
They do a daily foreign intelligence brief, which is a document that is sent to a reading list of people around various departments and within PCO.
They do an update.
Once a week to the Prime Minister, the Prime Minister's foreign intelligence update.
They will do bespoke products on specific situations.
We had, for example, this week, an incident in Ukraine where there was a missile shot down in Poland.
So they did a bespoke piece on that to analyze it very quickly in conjunction with the rest of the security agencies, primarily D&D in this case.
Okay, with that basic background out of the way, we'll move now to the events of January and February 2022.
So the first thing I want to ask you about is the early monitoring of the convoy.
and i'll ask mr clerk if you can pull up ssm.nsc.can403209
So this is an email from Mike McDonald, who we understand to be Assistant Secretary of Security Intelligence, to you, Jackie Bogdan, Jacqueline Bogdan, who is Deputy Secretary of Emergency Preparedness, a variety of people.
So to situate you in time, this is Tuesday, January 22nd, so ahead of the arrival of the convoy.
So I'm going to take you through a couple of points in this email.
If we can just scroll down a little bit, Mr. Clerk.
Okay.
Just a little bit more.
Here we go.
Thank you.
So, at this point, in monitoring the convoy thus far, the RCMP and other law enforcement report that it is peaceful, participate to being lawful and disciplined, as they have an objective of arriving in Ottawa on time, as planned.
While the current convoy is peaceful, concern lies around whether any individuals might join the convoy who are not aligned with peaceful protest.
And then there's some media reporting, YouTube videos, and some comparison to some people who might like to see a January 6 Capitol Hill type event.
Just scroll to the next page, please.
And we see there's some talk of social media.
Content targeting some ministers around the bottom of the page there.
And then, sorry, keep scrolling a little bit, Mr. Clerk.
Here we go.
Then there's CSIS has received media queries lately about the convoy and CSIS's role in any monitoring activities.
And there's a bullet here where Mr. McDonald says, this is a sensitive area for CSIS, as the CSIS Act defines that CSIS cannot interpret lawful advocacy, protest, or dissent.
As threats to the security of Canada, unless it is in conjunction with defined threat activity to the security of Canada, as defined in Section 2 of the CSIS Act.
For example, espionage, sabotage, FI, I think it's foreign interference, serious violence, destruction, or overthrow by violence of a constitutionally established system of government.
Can you explain what Mr. McDonald was referring to when he said this is a sensitive area for CSIS?
So what he is referring to is that with the media reporting that there were probably some people who had other than peaceful intentions, what was CISAs going to do about that?
And CISAs cannot surveil a lawful protest.
Now, if there are individuals who are subjects of theirs, investigations in that, they can monitor the activities of those individuals, but they cannot scan, surveil, watch a protest anticipating violence, looking for subjects to follow.
Okay.
we'll probably hear more from CSIS themselves when they testify on Monday, but would it be fair to say that there was limited information on the convoy coming into you from CSIS?
Absolutely.
Okay.
Then the next thing Mr. McDonald talks about, Mr. Clerk, if you just scroll down, nope, just sorry, back a little bit, outstanding questions.
So these are some questions that were flagged as issues that you might have to deal with over the period of the convoy, whatever that was then going to be.
Who has authority to pay attention to the online space and chatter?
Threats to parliamentarians.
Are other ministers, opposition leaders, or parliamentarians under similar threats?
What would engagement look like?
Should MPs meet with the convoy while in Ottawa?
Is this safe?
And do we have advice for them?
What will be the specific advice to ministers on this issue?
And I assume that's talking about meeting with members of the convoy.
And then if we scroll down a little bit more.
There's the talk of potential.
The CAF.
CAF is Canadian Armed Forces?
Mm-hmm.
Or JTF2.
What does JTF2 stand for?
Joint Task Force 2. So, Special Forces.
Special Forces have a possible role.
Okay.
So, it's fair to say that those were issues flagged by Mr. McDonald as things that PCO and the government would have to think about.
Flagged within the ADM NSOPS Working Group, I would suggest, rather than just Mr. McDonald.
Fair enough.
Fair enough.
Okay.
And I think we'll probably come back to some of those issues as we go through the chronology a little bit.
Okay, Mr. Clerk, if you can now pull up SSM NSC CAN 50250.
This will be another email sent on January 25th, and I understand you're not actually a recipient of this email personally.
It was to Mr. McDonald, but I'm hoping you can help us with some of the issues in there specifically.
Mr. Clerk, if you can scroll down to page three to a point where you see there is a gap where it comes to reporting.
There we go.
So this is our Deputy Minister.
So this is Derek Trehearne from Public Safety Writing.
I'm sorry, it's not Derek Trehearne writing, but in any event, it's to Derek Trehearne.
Our Deputy Minister, Rob, debriefed on the NSIA call on this topic today and mentioned that there is a gap where it comes to reporting on this issue as we head towards the demonstration this weekend.
Do you know what reporting gap Mr. Stewart was talking about there?
I would think that he is talking about information from law enforcement on what their planned actions are going to be.
I mean, we don't expect to be pre-briefed on what they're going to do.
We don't get into tactical plans, but the reporting out of the activity on the Hill, how is that going to happen in the protest?
Okay, so this is a law enforcement reporting gap?
That's what I think reading this.
Okay, so that is actually an issue that we discussed a little bit in your interview.
Can you tell us, can you explain to the commission what that gap is?
It's something that's been identified here by Mr. Stewart, and it was also identified in his testimony.
As I said, it was discussed also in your interview.
So can you elaborate on what that law enforcement reporting gap was from your point of view?
There is a general gap in terms of open source information and who can collect it, who can analyze it, and what we do with it.
RCMP collects information for law enforcement purposes, and as do other police agencies.
We've all heard of op-hending now.
I don't receive op-hending reports, as an example.
So the police forces collectively have a lot of information that they can't necessarily share.
And so those of us in jobs like mine and Deputy Minister Stewart's who need some overview of what's coming, who these people are, what their intentions are, have a difficulty in receiving that kind of open source information.
And did you identify that as an issue that reoccurred throughout the convoy?
Absolutely, it was an issue.
The online space is where planning now occurs.
And so it's not tapping phones any longer the way things were done in the Cold War.
Online space, non-warranted space, and how do you receive, assess, and then use that information in a legal manner?
So with that having been said, What was your expectation of what the convoy was going to look like when it arrived in Ottawa?
So Ottawa is the city of protests.
That's been said.
It's known.
The OPS is experienced in collaborating with all the various other agencies involved in terms of managing protests.
The early reporting was that this would be a normal protest.
Arrive.
Disrupt.
Spend some time here in Ottawa and then leave.
We were seeing just on Twitter feeds, you know, your own Twitter feed, indications that perhaps this was going to be something more.
But the information we had at that point in time from the accountable agencies was that they had it managed and it was going to be big.
It was going to be complex.
But they would be able to handle it in the way they have handled so many other protests.
So were any specific steps taken by PCO or by you ahead of the convoys' arrival to prepare for it?
Well, Op Intersect, which is the grouping that you've heard about of all the police agencies in Ottawa, was certainly...
Stood up and was operating.
Employees were told to stay home over the weekend.
Don't come to the office if you can avoid coming downtown.
We set up reporting mechanisms and we arranged to brief ministers on what we knew and what was going on over the course of the weekend.
And then as we know the convoy arrived and didn't leave when it was expected to do.
So what was the response from your perspective then?
So the original response every day, the question was, when is this going to end?
What are we doing to end it?
There's absolutely no doubt that having it end was the priority.
In the immediate, there seemed to be quite a bit of activity between OPS and RCMP to understand the magnitude of this.
At the same time, after the first weekend, we saw behavior on the streets that indicated they were settling in for quite some time.
You know, wheels were removed from rigs so that they couldn't be towed.
Supply lines were being set up.
And so something quite different was happening and unfolding in front of our eyes.
And within the federal government, the response you mentioned earlier, the ADMNS Ops, which is the Assistant Deputy Minister, National Security Operations Committee, and that's co-chaired by Mike McDonald?
Mike McDonald and Don Rochon at the time.
Okay.
And so we've heard already that that committee was meeting daily as an information sharing mechanism?
That's right.
And DMOC, you've heard a lot about it, it was meeting informally.
We made it a standing meeting every day at the same time, but we were checking in to see what we knew and what could be done to end this protest every day, and we were briefing ministers.
And DMOC was chaired by you?
Yes.
Is DMOC always chaired by you, or was that specific to this circumstance because it was a security thing?
As long as it has existed, it's been chaired by the National Security Advisor.
What other kind of meetings were you participating in?
That's the majority of it.
So with deputy ministers, hearing what the ADMs were doing, and then the law enforcement meetings were going on in parallel.
And certainly Op Intersect was meeting in parallel.
And what about externally to the federal government?
Were you participating in meetings that involved other authorities, municipal, provincial?
Not in the first weekend, not until the first meeting with the city.
And when was that?
Your recollection?
I don't have the date in front of me, but we have the information available.
So it was the first meeting that Rob Stewart called.
I had asked.
I'm new in the job.
We're meeting every day to understand what we can do, what action can be taken, who has what authority.
And I asked if I can call the city.
What is my role vis-a-vis the city being a federal authority?
We discussed it with Deputy Minister Stewart because he has the federal policing responsibility and that secretariat works for him.
It was decided he would do the reach out to the city and that's how we had our first meeting with the city manager and chief slowly.
Okay.
Mr. Clerk, can you pull up ONT50159?
So this is a summary of a call that was held with the city, the federal government, and the provincial government on February 6th.
This may be the first meeting that you were talking about.
It may be the second.
Second, I would say.
Pardon me?
Second.
It's the second.
Okay.
So I want to ask you about something specific in this meeting, which if we scroll down to page 9 of the PDF, I believe.
So in evidence...
That we've heard before, before the commission.
We've been through most of this already.
There's one specific point having to do with you.
It notes at the end here that you noted it was a positive meeting.
Regrets to end on this following point.
Would the province be looking to the federal government if this protest was happening outside the city of Ottawa?
For example, happening in other places like Kingston.
So, Mr. Mario Di Tommaso.
Deputy Solicitor General testified here a couple of days ago, a couple of weeks ago, I'm sorry.
And his impression of that comment was that this was the federal government trying to wash its hands of this entire thing.
So now that we have you before us, I wanted to ask you, is that what you intended by that comment?
Absolutely not.
From where we sat, all three levels of government needed to be involved.
And the federal government was very involved.
The RCMP was meeting constantly with the Ottawa Police Service.
We were...
Working to understand what the context and the elements of the people on the streets of Ottawa were and what they intended to do.
So that was the intelligence side of things.
We were looking at what federal acts and authorities could be used to have the rigs moved and the truckers leave downtown Ottawa.
And we wanted to know what provincial laws could be used and would be enforced to ensure...
We could clear the streets.
Mr. DiTomaso, his answer was, well, it's a federal jurisdiction.
Ottawa is a city in Ontario.
And the provincial accountability is the same for Ottawa, except for a very small precinct on Parliament Hill, where the majority of the protests were is a municipality.
And so...
I found that Mr. DiTomaso, well, friendly and cooperative, was very hands-off.
And I didn't understand why.
And I wanted to make the point that we're not Washington, D.C. Ottawa is a municipality of Ontario.
And so very simple things like the Ontario Police Services Act, which requires the Ottawa Police Service to go to the OPP for additional resources, is...
Were additional resources going to be provided to Ottawa to assist?
Thank you for that.
So I'm now going to skip ahead a little bit and talk about your role in briefing cabinet committees and cabinet itself and all of this.
So the first thing is, and this is in reference to something that you said in your interview and something that's also said in the institutional report, and I want to clarify what it means with the Commission.
In the interview, you explained that your role at the IRG meetings and any time you were briefing Cabinet was to provide a full and frank factual threat picture to Cabinet or to the IRG.
And again, then in the institutional report, it said, I don't think we need to turn it up, but the briefings that you gave did not include advice or recommendations.
So can you flesh that out a little bit and explain what you were and what you weren't doing and maybe why?
So without betraying what was said at the meetings, my role was to give an overview of the situation nation to nation, like coast to coast.
As we were moving into having blockades at border crossings, pop-up convoys across the country, as well as the situation in Ottawa, I gave a consolidated view of what was happening across the country, what we were seeing in terms of manifestation, intelligence that said there were going to be new convoys or maybe there weren't.
Saw from ceases on the IMD, the ideologically motivated extremist front, any arrests, those kinds of high-level details that framed the discussion that the Prime Minister was going to have with other officials and his cabinet ministers.
And so, did I give advice?
No, I gave an overview.
In the discussion, If required, I would make suggestions as all officials do at those meetings at IRGs, but my overview and my opening remarks were not advice.
And at some point it says that you would sometimes be asked to give or provide your assessment of a situation.
So can you explain the distinction then between an assessment of a situation and advice?
Advice is, so assessment is, Prime Minister, we think that they are going to stay in Ottawa for another weekend, looking at all the indicators the assessment is.
And that's a very simplistic example, but advice is the RCMP should move in right now and take it over and clean up the streets of Ottawa.
That would be advice.
Again, I'm giving you a very extreme example of something that was not said.
That's helpful.
Simple is good.
Simple is always good.
Okay, so I'd like to turn now to some examples of the actual briefings that you were giving at these various meetings.
So, Mr. Clerk, if you could pull up SSM NSC CAN 50292.
While you're pulling that up, I'll just explain.
This is the SSE meeting of February 3rd, and can you just give the Commission a brief reminder of what SSE is?
SSE is a Standing Committee of Cabinet chaired by Minister Blair, and it's the Safety, Security, and Emergency Management Committee.
Okay.
If we can just go to paragraph four, please, Mr. Clerk.
Hmm.
There doesn't seem to be a paragraph four.
Page...
Oh, there we go.
Yeah, thank you.
It's paragraph four of a different thing.
Sorry about that.
The National Security and Intelligence Advisor, NSIA, indicated that protest organizers have indicated an interest...
Sorry, I should slow down.
I know that.
Indicated an interest in negotiation.
However, the protesters confirmed that representatives from the city, province, or federal government have not reached out.
So this is February 3rd at this point, and you're indicating that the protest organizers have indicated interest in negotiation.
Where did that information come from?
What were you talking about there?
Open source.
They were saying it themselves.
They had news conferences, and they were putting out their own media indicating that they would sit down with representatives.
Okay.
And then you said various, the protesters confirmed that representatives from the city, province, or federal government have not reached out.
Was this also just from open source media?
So this wasn't from any particular information you had, just collating open source information.
Okay.
Mr. Clerk, next one is ssm.nsc.can50246.
Okay, these aren't minutes of a meeting, they're talking points.
So do I understand that these would be materials prepared for you by your staff in preparation for one of these meetings?
That's correct.
Okay.
We go to page three, please.
We go to page three, please.
Senior, there we go, the bullet that says senior officials.
So, senior officials, Deputy Ministers Stuart, Keenan, and myself continue to engage the City of Ottawa to encourage dialogue with demonstrators, consultations with provincial regulatory authorities, sharing of operational plans, and a coherent communications approach.
And I see encouraged dialogue as bolded and underlined there.
So, what was that about?
What were you talking about there, dialoguing with the protesters?
Some of it was the work that was already being done by the PLTs.
And so it was to introduce that discussion and that line of work that was being done by OPS with the demonstrators.
And we were hearing that engagement would be welcomed.
It wasn't yet defined.
We didn't have a plan for it.
We didn't even know what it would look like.
But we're just reporting what we're being told.
And we're hearing that from the City of Ottawa, primarily.
Okay.
But what it says there is that Deputy Minister Stewart, Deputy Minister Keenan, and you are engaging the City of Ottawa to encourage dialogue.
So at that point, were you actively encouraging?
For the city to talk to them, yes, because this was happening in the City of Ottawa.
Okay.
In the hope, then, that dialoguing with the demonstrators would produce a positive outcome.
Exactly.
Reduce the noise.
The number of rigs hopefully break up the protest.
The next document, please.
ssm.nsc.can50209 So this is the February 10th IRG.
And we're going to get into this in more depth with your PCO colleagues tomorrow.
But again, just a brief description of what the Incident Response Group is, please.
The Incident Response Group is a cabinet committee chaired by the Prime Minister that is used to make quick, rapid decisions about incidents of national importance or a crisis.
Including national security incidents.
It's been used multiple times.
It was used over COVID.
It was used for the Hurricane Fiona.
It was used for the downing of Ukraine Flight 752.
So it's an effective tool that the Prime Minister invokes in order to have discussions with both ministers and officials at the table so that he hears from subject matter experts, the Chief of the Defence Staff as an example.
Deputy ministers with particular expertise as well as ministers.
Thank you.
If we can just scroll down then to page five, please.
So February 10th, I believe, was the first IRG meeting?
yes it was Just going to find the actual page.
Okay, here we go.
So the National Security Advisor.
You're giving a rather lengthy report here.
Ottawa's situation remains largely unchanged.
Threats on social media persist.
It continues to be used as a planning tool.
Possibility of driving by Sussex and local schools.
And there's indications that some protesters would like to leave but are unable to do so given physical barriers.
And integrating planning cells, developing a plan of action.
The preference remains to continue moving forward with negotiations, with enforcement actions to start early next week if negotiations remain unsuccessful.
And then a surge in contain strategy will be employed for the upcoming weekend.
So is it fair to say at that point that the notion of negotiating with the processors is still very much on the table?
It was still being explored, absolutely.
Then you go on to talk about the coups, and there's a line here.
The number of protesters had dropped from 200 to 40. However, those remaining are firmly entrenched in their views, and there are weapons on site.
So that's information that had been provided to you by the RCMP?
Yes.
Weapons were on site at coups already.
Right.
At that point, only the RCMP knew the extent of the weapons.
I'm sorry.
Only the RCMP knew the extent.
So you knew that they were present, but you had no idea about the extent?
That's correct.
We can just keep scrolling down a bit, please, Mr. Clerk.
CSIS reports tracking several individuals, and then there's some threat assessments by CSE and CSIS.
Scroll down a little bit more, please, Mr. Clerk.
Okay, I think that's probably it.
So, on that topic of negotiation or engagement, I just want to take you sort of a bit of an aside for a moment, but related.
SSM can 406131.
While that's being pulled up, I'll just situate this.
So this is the engagement proposal about which the commission has heard quite a bit.
Oh, I think just scroll down a little bit more.
There we go.
From Ms. Thomas.
So this is a February 11th email at 2.30 p.m. that you send to Janice Charette, who's the clerk, Nathalie Troin, who's the deputy clerk, and what you say is you're forwarding the engagement proposal and you say, Rob has continued his engagement.
I suggest we need to decide if this has a green light.
I expect he will get more specifics.
And then it just says, we indicate a positive response.
I think there's probably an if missing there, if we indicate a positive response.
So can you situate what this email was about, what you were saying to the clerk and the deputy clerk when you sent it?
So the engagement proposal needed to be discussed by ministers, and certainly no deputy minister or I had the authority to...
Move forward with engagement without it being discussed at a cabinet level.
And the green light was to get it on the agenda to be discussed formally.
Okay.
And did you have a view at that point on the engagement proposal, whether it was a good idea, a bad idea, likelihood of success?
My view at that time was that we should take nothing off the table.
We had to continue to explore all options.
We were going into the third weekend on February 11th.
I didn't understand yet what the negotiating mandate would be.
So you go with something and you expect to get something back.
And we had no clarity on that.
Further, we had no clarity because of the disparate group of people who were blockading Ottawa, and this was about Ottawa specifically, who would be the leader, who would be able to coalesce.
the, you know, the mass of humanity who are on the streets of Ottawa to then adhere to whatever was negotiated.
So, beyond having a view that it shouldn't be taken on the table, did you ever form or were you ever asked for your view on whether it should or should not go ahead?
Not at this point.
During the discussion at Cabinet, views were sought.
Okay, so this is February 11th, and I believe it was brought to the IRG on February 12th?
Correct.
And at that point, views were sought?
Correct.
And you provided a view?
I did.
And your view was?
It's protected.
Got it.
Okay.
Okay.
Thank you.
Can we then go to the February 12th IRG?
.nsc.can50214.
We can scroll down then to page 5. In terms of specifics, to scroll down a little bit more, the NSIA reported that the situation in Windsor remains very fluid, with law enforcement having begun to take action.
In Ottawa, we're seeing a significant escalation in the boldness of protesters.
So just stopping there, what does that mean?
What was that observation?
Yep, we were hearing this from the OPS and Intersect, and certainly, again, social media and media.
They were, bouncy castles had happened.
The view that they were here to stay, that they had zero regard for the citizens of Ottawa, that social media was talking more and more about aggressive action to stay, holding the line, dig in.
It was just a change in tone that was noted.
And sometimes changes are subtle.
But you have to pay attention to them.
We saw more people on the street that weekend than we had anticipated.
And fewer people were leaving at the end of the day.
And the raucous atmosphere was extending later into the evening.
We saw things like the wrecking ball on Wellington Street by then.
And so there was just a change in the...
Forcefulness of the tone.
And did that have an effect on your assessment of the situation?
Well, you're also hearing the increased low level of violence, the fears of the citizens of Ottawa, the honking continued despite the injunction.
What became apparent to us as we were assessing the situation is that this wasn't breaking up.
Okay, and then if we can just scroll down again, Mr. Clerk, to page 15. So this is part of what became known as the IRG tracker.
Can you just explain, Ms. Thomas, what the IRG tracker was very briefly?
So the issues that were discussed at IRG and the action plan out of it was this tracker.
I think the Prime Minister was...
I'm paraphrasing here, and I don't want to put words in his mouth, of course.
The Prime Minister and the Clerk were concerned that people would discuss, leave the table, and then what would be the outcomes of the direction that was given.
And so this was to track all the activity to understand what could be done and the progress, the status on achieving certain goals.
So the action plan for tow trucks.
For instance.
So what was done, where did it stand, and we would update it every single day.
Okay, and the one that pertains specifically to your area is item number four here, which is identify immediate measures to close the intelligence gap, i.e.
open source, non-criminal, non-terrorist.
Can you elaborate on that?
Is that the intelligence gap you referred to earlier, the social media?
It is.
So the RCMP, OPP, OPS all collect open source information for law enforcement purposes.
We saw that in OpHind.
CSIS collects some open source information in very specific circumstances for subjects or investigations of their own.
We knew that social media was being used to mobilize, to plan actions, to talk about what was going to happen next, to talk to other protests across the country.
You can't do that as an individual.
You can't track individuals.
PCO cannot track individual social media.
We didn't have the tools in place.
To do scraping of social media and understand the trends.
As an example, one morning they talked about slow-rolling convoys through school zones.
It was being reported on the radio that this is all over Twitter.
Why aren't the police doing anything about it?
Not that the police can respond to everything they see on Twitter, and that's not what I'm implying at all.
If we had the correct tools and the legal mandate to collect this kind of information, we would have some understanding of the trends and where this was potentially going.
We didn't have the tools or the mandate.
Okay.
On that point, Mr. Clerk, I'll just ask you to turn up the witness summary, please.
that's wts5071 at page six Under the social media intelligence gap.
So, Ms. Thomas, I'll just ask you to elaborate with reference to this a little bit on some of the points you were making.
For instance, the tools.
What tools, when you say we didn't have the tools, what tools are needed to do that?
Well, there are social, there are IA-based tools that can be purchased.
To look for keywords, to look for algorithms.
And we don't have those.
You can't put a person in front of the screen and just have them Google Convoy and get enough information quickly enough to do anything with it.
So you actually need computer-based tools to do computer-based analysis.
Okay.
And then just scrolling down the page again a bit, please.
Thank you.
So just the point where it says NSIA Thomas there.
One of the issues that was identified there was distinguishing between credible threats and non-credible threats on social media.
Can you tell us a little bit about that and the difficulties, if any, you faced with that?
That is one of the primary problems that we're facing right now.
The level of violent threats against the Prime Minister and other elected officials and some public figures, Dr. Tam, as an example, received.
Enormous hate online and some of it was threatening and indicated a threat against her.
Distinguishing a credible threat, an identifiable person with an identifiable threat.
That looks like they have the capability to execute that threat.
So not only intent, but capability is sort of the formula used to understand if a threat is credible or not.
The problem is online, people are difficult, in some cases close to impossible to identify, throw burner accounts, etc.
It is easy to hide an identity online.
Now, the RCMP and other police services do a very good job of those kinds of investigations, but in the moment, in the middle of this crisis, with the number of threats going up against elected officials, it was an enormous problem and an enormous concern.
Okay, now we'll move on to the February 13th, please.
So Mr. Clerk, that's SSM NSC CAN 50216.
Scroll down to page eight, please.
So this is the cabinet meeting on February 13th, and this is the report that you're giving it.
This was definitely a key moment in the events and in the eventual decision to invoke.
And you're reporting on what you've heard from various agencies, including CSIS and including the RCMP.
I don't know if you had a chance to see the RCMP's testimony the other day, but Commissioner Luckey testified that she was never asked to speak, either at the IRG meeting on February 13th or at the Cabinet meeting on February 13th.
And there's a key bit of...
I call it evidence, but it's information at the time, where Commissioner Luckey had expressed the view to Mike Jones, who is the Minister of Public Safety's Chief of Staff, that law enforcement had not yet exhausted all available tools to it.
Is that a message that you, who were asked to speak at these meetings, conveyed to the IRG or to Cabinet at either of those meetings?
No, I was not.
And we build my speaking points from the information from the agencies and departments.
I will say that at an IRG, Deputy Ministers and Deputy Heads, individuals who are at that meeting are expected to provide information that is of use to decision makers, being the Prime Minister and his Cabinet.
And so if there is useful information or critical information, it needs to be provided, whether you're on the speaking list or not.
Was that information provided by Commissioner Lucky to you?
In the DMOC meeting that morning, she said that there was possibly a plan with the OPS and OPP.
She had said that several times previously.
Okay, so that's about whether or not there was a plan in Ottawa.
Yes.
Did she say anything specific or did you know that her view was law enforcement had not yet exhausted all its tools?
No.
Okay.
The next document is SSM NSC CAN 50298.
So these are your talking points for this meeting.
Chronologically a little out of order, but that's okay.
Okay, so here again we see the mood of the organizers in Ottawa appears emboldened.
So that's essentially a repeat of a point that's been made on a previous day, no change there.
And then there's talk of City of Ottawa announced agreement with protest leader Tamara Leach that could lead to...
Approximately 70% of trucks and cars leaving the residential areas in the downtown core over the next 24 hours.
I'll explain a little bit more detail about that.
Given the anti-government sentiment of Ottawa Group, along with the decentralized nature of its leadership, it is unclear at this time the concurrence of other leaders in the group to the agreement.
So is that your assessment of the situation there?
It was our collective assessment, yes.
And we were already seeing signs that the agreement was falling apart, that other leaders, other parts of the blockade were saying, no, we're not leaving.
That there is no deal.
Would it be fair to say that at this point your confidence in negotiation with, dialoguing with protesters was no longer what it had previously been?
At this point, it was very clear that there was no one person or group to dialogue with where you could get achievable outcomes, which meant the group breaking up in downtown Ottawa.
We're going to move now to the February 14 DMOC, so that's SSM.nsc.can50217.
Bottom of page one.
Keep scrolling a bit.
There we go.
OPS has approved a joint operational plan for Ottawa developed with support from RCMP and OPP will be put into action in coming days.
So this is now, we're on February 14th.
In your recollection, when was Cabinet made aware that a plan was coalescing to carry out an operation in downtown Ottawa?
I don't recall cabinet being informed of that.
But on February, I will go back to on February 13th, this had also been said, and there was an IRG, and at this point, so it wasn't said at the IRG, at this point, we had no evidence of that.
And so while it was said, And these are the minutes.
There is no evidence that there was a plan.
And as I noted, we had been told there was a plan multiple times.
When you say no evidence, what kind of evidence would you have expected to see?
We would expect some level of assurance from the RCMP that the people were in place, it was executable.
We don't expect to see details.
That's policing.
But we needed a level of assurance that yes, finally, the officers needed, the equipment needed, the executable strategic and tactical plan was there.
The same thing that had been asked for several days.
We didn't have any evidence or assurance that that was in fact where we were.
Do you think that that falls into the law enforcement reporting gap that you discussed earlier, the information sharing between law enforcement and your level?
I think that's part of it, yes.
I also think that the plans were just not quite as firm as we would have hoped.
Okay.
Also on February 14th, then, dot nsc dot can four zeros eight four eight five please Scroll down, please.
Scroll down again.
I think it'll probably be the bottom of the bottom of the second page you want to start with.
There we go.
So this is a series of emails that you sent the morning of February 14th, around 11.45 noon.
The first one is, I need an assessment for Janice about the threat of these blockades, the characters involved, the weapons, the motivation.
Clearly, this isn't just COVID and is a threat to democracy and rule of law.
Could I get an assessment, please?
David, I assume that's David Vignon.
CSIS Director, is this you?
It's a very short fuse.
Please call if you have questions.
Can you explain what that email was about?
Who was it to?
What was it about?
What were you looking for and why?
So I don't remember all the people on the two, but probably Mike McDonald, David Vigneault, RCMP.
It was part of a complete package of information that was being put together.
There had been multiple threat assessments, but this was to be a formal document, and we had just discussed it in a...
And so, we talked about the need for a last formal document should Cabinet decide to proceed with the Emergencies Act, as opposed to the daily updates we were giving, so laying out the entire spectrum of threat.
And so I needed it very quickly.
We were going to collate it.
We just needed the information from the agencies.
Okay, so the intention was to get that assessment for Ms. Charette, the clerk, and she would then provide it to the Prime Minister.
Okay.
And we just scroll up a bit to the next email.
So this one is to Mike McDonald, Rob Stewart, something blanked out, Inez Neville and Martin Green.
Inez Neville, who's that?
She's my chief of staff.
Okay, perfect.
This is about a national threat to national interest in institutions by people who do not care about or understand democracy, who are preparing to be violent, who are motivated by anti-government sentiment.
What are you saying there?
Are you setting out what the assessment should say?
I was being asked questions about how specific it should be, and so that was my response.
How specific it should be in terms of?
Of what the threat was and sort of the range of issues that were of concern.
So national interest in institutions, lack of confidence in police as police were being stretched across the country.
The desire to have government policy changed by force, mandates.
There were people preparing to be violent.
We saw it on social media.
We certainly knew that both CSIS and RCMP had concern about some people and the potential for violence.
And there was certainly an anti-government sentiment throughout.
So does what is reflected in this email reflect your assessment of the situation at the time?
Not everybody on the ground, absolutely.
This wasn't a monolithic group of people.
But yes, those elements were there.
Was that assessment ever produced to you?
I don't think it was.
And would that be, why would that not happen?
I think it fell through the cracks and we were overtaken by events.
Okay, the next topic I want to address with the next document, let's start with the document, SSM.can50297.
Before I go there, actually, if that document had been produced, that threat assessment, it would have been CSIS who did it?
It would have been the RCMP who would have been?
PCO probably would have written it based on information received from all the agencies.
Okay, so it was a call for input so that PCO itself could produce the correct.
The topic I want to address with you now is something that has come up, will come up, and will forever be part of the Commission's inquiry, which is this idea of what is a threat to national security.
This email, scroll down a bit, sorry, just want to see.
So this is an email from you to Jacqueline Bogdan, a fellow named Philippe LaFortune.
Can you tell us who that is?
Philippe LaFortune worked for Mike McDonald, I believe it was Mike, in the Security and Intelligence Group.
Okay.
So Philippe did some research, which is handy to keep in our quote-unquote back pocket FYI at this stage, Mike.
And the date of this is February 9th.
So before the IRG started, this research was done.
Mike, as requested.
We did some digging on the Canadian definition of national security.
As you know, one of the challenges on this issue is that the GOC, Government of Canada, never ended up formally defining it.
However, we looked at transition materials and various acts to provide you with the best answer and its potential applicability to the current situation.
Below, you will find a policy definition of national security, but also...
N-S-I-C-O.
Can you explain what N-S-I-C-O is?
If not, it'll make me feel better about my lack of academic knowledge.
I do not.
Offhand.
Take on it.
And what the CSIS Act, SCIDA, S-C-I-D-A.
That's the information sharing.
Information sharing.
Okay.
And the Emergency Act stipulate on the issue.
Here are the various pieces.
We'll just, I think, probably read through most of this email because it's quite relevant.
But first of all, before we get into the specifics of it, can you explain the context of why that information was being sought?
No, I don't think I asked for it.
I don't recall, unless there's an email that says I did ask for it.
But it is an ongoing question.
Who defines national security?
What is the definition?
And even in the national security policy in 2003, I think it was written, it wasn't really defined.
Okay, so that's what Monsieur LaFortune is talking about when he says the problem is it's never been formally defined.
And how would that be formally defined if it were to be?
In a public policy.
In a policy.
So not in legislation, but in a policy.
Yes, correct.
A Government of Canada policy of some sort.
Right.
A national security policy, as an example.
And that would be something prepared by, if it were to exist, PCO?
No, probably public safety.
Public safety.
as that policy lead on national security issues.
Okay, so here we have the first, National security pertains to the safety and security of Canada's territory, government, economy, and people, as well as the promotion and protection of Canadian national interests.
National interest refers to Canada's sovereignty, democratic processes and institutions, security, territorial integrity.
Economic prosperity, social cohesion, environmental protection, and healthy and resilient communities.
That's the ENSECOP.
So ENSECOP, I believe, is the National Security Intelligence Committee of Parliamentarians' annual report.
So that's about as broad a definition of national security as one could possibly imagine.
That's correct.
Then there's the legislative perspective reported by Monsieur LaFortune.
What he says is there is no true legislative definition of quote-unquote national security.
The CSIS Act and SCADA provide examples of threats to security and activities that undermine security.
However, do not exclusively define what is included in the term quote-unquote security as their lists are non-exhaustive and do not specifically reference quote-unquote national security.
And then there's the definition of the CSIS Act, which we're all familiar with now.
Just scroll down a little bit, Mr. Clerk.
SCEEDA has its own definition here.
Scroll down a little bit more.
Then there's a quote from a Supreme Court ruling.
I think the case is actually called Suresh, not Sunrush.
And so what the Supreme Court says in Suresh is they talk about danger of fair, large, and liberal interpretation in accordance with international norms must be accorded to danger to the security of Canada.
And they're talking about deportation here.
Then they say the danger to the security of Canada is difficult to define.
And then they go on and talk about a broad and flexible approach, etc., etc.
Then, I think this is now Monsieur LaFortune, not part of Suresh, the Emergency Act, and he talks about how the Emergency Act does define national emergencies as the following, and then he gives a definition, which again is familiar to us here in the Commission.
So you received this email, this sort of memo, if I can call it, on national security.
Did that have any impact on your thinking, your assessment of the situation that was happening at the time?
No, it laid out the complexity of understanding how to define the problem set, absolutely, but not particularly.
We received a lot of information in those days.
And would this memo be something that was kept internally to PCO, or would it have been disseminated, shared, would it have been briefed up to Cabinet?
I don't believe it was ever discussed at Cabinet, but certainly it was shared with other deputy ministers.
And you're aware, of course, that CSIS assessed the protests as not constituting a threat to the security of Canada as defined in Section 2 of the CSIS Act.
They said it did not meet the threshold as defined in their very narrow interpretation of what they can do under their act.
And obviously we'll hear directly from them on that on Monday, I believe.
But were you personally ever asked to advise on whether that definition had been met?
No.
Were you ever asked whether you thought that the invocation of the Emergencies Act was necessary?
Yes.
When was that?
February 13th.
And what was your answer?
It was discussed in a cabinet meeting.
Let's see what we're doing for time here.
Oh, we have time.
Okay, so the next thing...
Oh, yes.
Morning, afternoon, evening, whatever it is.
Yes, please.
We can take the break now.
Take 15 minutes and we'll come back and continue.
Thank you.
the commission is in recess for 15 minutes you you you you you you you you you
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Thank you.
Also a limitation.
Order alert.
The Commission is reconvened.
Commissioner Brown.
It's okay.
I'll just step out for a few minutes.
you can you can see the next one.
you can see the next one.
you can see the next one.
Ms. Thomas, I understand that you had some discussions at break with your council, which actually obviated the need for me to have a discussion with your council about whether or not you could answer some questions about the inputs that you and views you expressed to Cabinet on a couple of issues.
So I'm just going to ask you those questions again.
The first is with respect to the engagement proposal.
What view did you express to Cabinet on the engagement proposal?
After the discussion was concluded, my view is that it was not a workable plan.
And this would be on February 12th?
Yes.
And why did you form that view?
That I did not see who we would negotiate, engage with, what the outcomes could possibly be, that there was not one group who had enough influence over the entire group to affect an outcome.
That would be positive.
And I did not know who we would put in front of them.
Esteemed and capable as my colleague Deputy Minister Stewart was, that wasn't going to be a name that was going to mean anything to the protesters.
And so who it would be, what they would do, and who it would be with were unanswerable questions.
We had also seen negotiations attempted and failed in Windsor.
And we actually, as has been testified here, Knew that in COOTS, the engagement strategy and the lessening and the path to reducing and removing mandates in Alberta actually caused the protesters there to dig in because they thought that would then allow for a complete removal immediately.
So the unintended consequences were greater than the consequences.
And the second question that fell into that category of whether or not you could answer is whether you were ever asked whether the Emergencies Act was necessary.
Yes, and I apologize.
Yes.
And my answer was yes.
Okay.
And that was on February 13th?
Yes.
The other area I'd like to take you back to briefly, just to elaborate on a little bit, is this idea of the law enforcement gap.
In reporting.
So, for that, can we pull up the witness summary again, please?
So it's WTS BUNCHOZERO 71. Down to the bottom of page 7, please.
Okay.
So you've discussed here two different sort of intelligence gaps that you've identified.
One is the social media gap that you've spoken about and we may speak about again.
The other is the law enforcement intelligence gap.
So what you've expressed here is a slightly more elaborate view than you'd expressed earlier today.
You didn't receive, and this is you and Assistant Secretary Mike McDonald, Social Security and Intelligence, did not receive direct reports from law enforcement partners such as OBP, OPS, WPS, so that's outside the quote-unquote federal family.
You can tell I'm learning the lingo.
That constituted another significant intelligence-sharing gap.
Assistant Secretary MacDonald recalled a significant delay in receiving updates from the RCMP, given the RCMP's policy obligation to consult with each relevant agency prior to sharing investigative and operational information.
And you clarified that neither you nor your staff receive SITREP, so situation reports, project reports, or other forms of information directly.
And as you mentioned today, you hadn't heard of Project Henson specifically.
And if we just scroll down a little bit, it also says there that you learned of the Coots arrests through the media, not directly from the RCMP.
I'm just scrolling down a little bit again.
Sharing among all three levels of government and information and intelligence in relation to the convoy could have been better.
So I'll just ask you to elaborate a little bit on where you think the deficiencies are and what maybe can be or should be done about them.
Because as you know, the Commission has a sort of a forward-looking mandate as well as a backward-looking one.
I think when we are looking at...
Primarily open source information, as opposed to investigation-specific information.
So let's draw a line there.
The RCMP is investigating person X for having done something criminal.
As the NSIA, should I receive that?
No.
I receive information when the RCMP are making an arrest of a federal crime that would be of interest to the NSIA.
But after they've done it, or as they're about to make the arrest or make the announcement.
General tactical operational information on a day-to-day basis, I don't have any need for from the RCMP.
But when we're in a situation like this, it's a crisis.
I'm coordinating the town.
The RCMP is where I'm coordinating the town.
I'm asking for information about what's happening, what's coming, what they expect, what...
Not, again, operational planning, but what is going to happen, what law enforcement is talking about, what their concerns are, because there are ways I can help, potentially.
It would be useful to have that information.
And we didn't receive the flow of information from the RCMP, even their intelligence unit, that I think we possibly might have.
When you say there are ways you can help.
What are you referring to?
We would do X, Y, or Z, and we think this is necessary.
We're short 100 people, or we need cabinet permission, or we need...
It could be any number of things, and the hypotheticals are long.
But in this particular situation, I think that we could help...
We could reduce the pressure on the RCMP to answer questions constantly if we had some indication of the intelligence they were seeing, primarily, again, open source, and what they were going to do with it.
We could answer questions.
We could reduce the anxiety about what was going on.
So from your perspective, keeping in mind the need for police independence, which...
Absolutely.
This isn't interference or telling them what to do, and it's not getting in the way of an operation.
It's just...
Information flow.
So there's some work to be done in the area from your perspective of information flows between law enforcement and government.
Absolutely.
Switching gears a little bit, the next topic I want to address with you is...
Sort of an existential one, but the line between lawful and unlawful protest.
And I'm going to do this with reference to a few documents in which this was brought up and came up repeatedly over the course of the events of the convoy.
The first one, Mr. Clerk, is SSM.nsc.can303211.
Scroll down to page two, please.
So this is a readout, a report from ADM NSOPS on January 26th.
Excuse me.
There we go.
Under posture.
So first they're talking about the RCMP monitoring and then...
ADM's committed to return to the committee with specifics on what will trigger the event from peaceful event to one requiring law enforcement action.
So I realize it's ADM and SOPS not specifically at your level, but is it fair to say that that was something on the radar?
When does an event go from lawful to unlawful?
Absolutely.
It was a question that we discuss constantly.
And I don't know...
There may be a policing definition, but there certainly isn't a public policy definition.
And you'll see it says here, ADM is committed to return with specifics.
To your knowledge, and I know this isn't your committee, but to your knowledge, did that happen?
I didn't see it.
If it did, I did not see it.
Okay.
It may be that the next document is the answer, but I'm not sure.
sm.nsc.can50294.
at page six please Under peaceful event.
Okay, there we go.
Perfect.
Peaceful event.
Key question remain.
How does this end and who is left?
E.g.
numbers may be lower, but what is the threat nature of remaining individuals?
And then there is no finite timeline for when a lawful protest must end.
As long as it remains lawful, it may continue.
Violence will require a public order response.
OPS has brought in additional support teams.
Okay, so that is something being said about the line between lawful and unlawful.
I don't know if it's...
I think maybe you don't know either because it wasn't your committee whether that was the specific sort of deliverable return on that point.
But if so, it's not a particularly detailed answer.
Yeah, I think there are distinct issues.
When a lawful protest ends versus when it...
Trips into something else.
I think those are two different issues.
And one is very much a city issue.
How long the city gives permits for protests, those kinds of things.
I think that's more in the city's domain.
When it moves from lawful to unlawful and becomes a public order issue, again, mostly belonging to a municipality, but we are in a unique circumstance here in Windsor, in Coots.
When do protests, blockades, become unlawful?
Because this is talking about the OPS, but the question we were asking ourselves was much broader.
Okay.
That's a helpful distinction, actually, and it'll come up in the following discussions.
So the next document is SSM.CAN5016.
So this is a readout of the February 14th DMOC, and if we can scroll down a bit to page two, please.
There we go.
The NSIA and Director's Thesis.
So this is the DMOC that's being held on February 14th.
Do you remember what time that DMOC was?
I think there were two on February 14th, or there might have been two on the 13th, but we were generally meeting in the morning before we briefed ministers.
Okay.
So the NSIA and the Director of CSIS highlighted the need to better understand where and how the convoys metastasized into something else.
We have seen a fundamental shift.
Protest that affects people's ability to live and exist is no longer peaceful, need to understand long-term trends.
So can you tell the Commission a little bit what your thinking was there in saying that the protests had metastasized, the convoys rather, metastasized into something else?
My recollection is that it was a very interesting conversation, one that we needed to spend more time on.
But in the height of a crisis, you move on to operational things very quickly.
It was a discussion about lawful and unlawful, violent and peaceful.
And can you be unlawful and still, for all intents and purposes, peaceful, meaning you're not January 6th?
And is that line of violence only measured when you are at the January 6th stage, status, series of events?
Or is the violence the people of Ottawa were experiencing on the streets, the inability of people in Windsor to conduct their lives in the neighbourhood where the blockade was, the inability of the town of Cootes to function?
Is that a line?
And so where is that?
And I don't have an answer for it, but it is something that we have to consider as situations like this perhaps become more of the norm.
And what we were discussing is that the only measure can't be violence of a nature of January 6th.
That can't be, well, this is something different, or January 6th is about to happen, therefore it is now a...
Not only a legal, but a national security threat.
There is a spectrum of activity and behavior and threat in there that we need to understand.
And so that was the nature of the conversation.
And it's one that's continued.
I can't tell you that I have a paper on it yet.
We don't have a policy paper to bring forward to the clerk, but it is a conversation that is continuing.
Because it's critical.
We have seen these kind of uprisings in democracies around the world.
What does it mean?
What can we do?
What should we do?
Questions to be asked that have to be thoughtfully considered before we're in this situation potentially again.
In a sense, I think you've preempted my next question, which is, is this an area that is being worked on within the federal government?
In case anything like this ever happens again, where that line is.
When you talk about the line between lawful and unlawful, in some senses, that's the line where intervention would happen.
Correct.
And yes, the work is ongoing.
The next document, please, Mr. Clerk, SSM.nsc.can50405.
Okay.
So this is a related point, Ms. Thomas, to situate you a little bit on the need to protect lawful protest.
There is unlawful protest at some point.
We don't know precisely where that line is, you've said, but the need to protect lawful protest in all circumstances where possible.
Was there any thought given, and I'll wait for the reference to turn up here, but...
In your recollection, was there any thought given in the discussions around how to intervene once it became clear that there was going to be intervention in what was happening in Ottawa specifically?
I suppose it would apply across Canada, but specifically in Ottawa, to protecting lawful protest.
So, a subset of that protest.
Was there any thought given to, okay, well...
You can't do it on Wellington Street, but maybe you can go somewhere else.
And I'll just situate you a little bit here.
Can we turn down to page...
I believe it's page two.
Could be a bit later.
Sorry, keep scrolling.
I'll find it.
Keep scrolling, please.
No, I guess not.
page five sorry Thank you.
Okay, there we go.
So this is a description, and I realize it's not your description.
It's the RCMP, I believe, but keep scrolling a bit down, please, Mr. Clerk.
I'll tell you when you got it.
Okay, yeah.
The focus of the operation today has been on clearing protesters south of Wellington and reinforcing barriers.
Protesters remain at Bank and Sparks, have been advised that they'll be arrested if they do not leave.
Public order units continue to wear tactical gear, but police tactics remain focused on de-escalation.
This is February 20th.
Police are also monitoring a gathering that has formed the War Museum of approximately 100 people and a smaller gathering of 30 to 50 at Confederation Park.
Information suggests some indication some protesters are staying in the secure zone, and I think that's about it.
Including at hotels in this area, RCMP is looking into.
So these other areas, the War Museum and at this point it's Confederation Park, were these lawful protest zones to your knowledge at this point?
I'm speculating in terms of the particular situation.
The Emergency Act was still in place.
I don't know if these locations, because I don't have the map in front of me, are still in the exclusion zone or not.
And so if in the exclusion zone, by virtue of the act, if inside the exclusion zone, they would have been illegal.
I In regards to your question about protecting lawful protest, that's a fundamental.
People who wish to protest lawfully...
Peacefully, respecting the rights of, in this case, the citizens of Ottawa, that's a given in this city.
The right to do that is a given in the Constitution.
It's just a fundamental right Canadians have.
That discussion, again, about when it metastasizes into something else is what we are pursuing.
So I think this will be the last area that we can cover today, but I want to ask you about a couple of intelligent assessments, secretariat assessments that were produced at the Commission.
The first one is SSM.nsc.can40218.
It's called Context for Civil Unrest Following Pandemic.
So first of all, this is a document dated February 16th.
Can you tell us the genesis of how did this document come into being?
So when we spoke about the Intelligence Assessment Secretariat, I said that they will do longer thought pieces as well as immediate operational assessments.
So the immediate, the missile strike in Poland.
This is an example of the kind of thought they do, piece they do to look at trends, to understand the context in which This is a companion piece to something that they had written long before I came to PCO.
I was given it to read, just as I arrived at PCO, about what happens in societies historically after pandemics.
And so, a very interesting piece, and this was a companion to it.
Okay, so you already had a piece on what happens after pandemics.
Yes.
So we'll take you through a little bit of this, and you can tell me if this is something that would have been known before February 16th and formed part of the context you were thinking about, or whether it was an ex post facto.
So the first thing, just introduction, historically civil unrest, degradation of social cohesion have been common in the immediate aftermath of pandemics or epidemics.
The health impacts and restrictions involved provide fertile ground for social unrest and mobilization as pandemics progress or end.
This is particularly true when there are existing underlying inequalities and or social fault lines within the population.
The ongoing trucker protests have several markers demonstrating consistency with this trend.
Your thinking when the convoys rolled in, or was this something that was only thought about after the fact?
I didn't know about the previous piece when the convoys rolled in, because again, I wasn't at PCO, and in my job at Defence, I hadn't seen it.
The clerk brought it to my attention as something she had read and found very interesting, and so I pulled it up and read it, and this was done as an addition to that.
If I understand correctly, it wasn't part of your personal thinking, but it may have been part of the thinking at PCO.
I think it was part of, thinking implies, I think it was more a consider, it was just informative.
If we just scroll down a little bit more.
Speaks to Canadian historical context.
1885 vaccine requirements intended.
To curtail the spread of smallpox resulted in public violence throughout the city.
For the Washington Post, more than 2,000 violent rioters marched through the streets of Montreal screaming kill the vaccinators in response to vaccine mandates.
Thank you.
So again, this would be part of the context that PCO was aware of at the time and was thinking about, but not your specific thinking.
Some people were aware.
Was it of the documents we talk about on a daily basis at PCO?
Was it one of them?
No.
IAS, the Intelligence Assessment Group, puts out a lot of these.
People read them not as an immediate to do their job.
They read them as thought pieces when they have time on the weekend.
And so who's read it in PCO?
I couldn't tell you.
And what would be the purpose of having an assessment like this done?
Again, the assessment group takes global trends, takes events, and tries to help predict what will happen.
And they use, in this case, a lot of academic and historical research to build their assessment.
Okay.
the next uh the next assessment is ssm.nsc.can40231
So the first paragraph here, it talks about the date of this one is the 21st of February.
So this is right, actually, as the Emergencies Act was being lifted, and to a certain extent, events were coming to an end.
And it says here, the Freedom Convoy is not an unprecedented event.
Again, talking about societal alienation.
Civil unrest and social polarization.
But then it says the convergence of several elements make this protest somewhat more sophisticated and unique.
The use of social media for organizing and communicating both internally and externally.
The use of misinformation and disinformation to promote certain narratives.
The use of crowdfunding, cryptocurrency, blockade tactics and logistics.
Virulence of discourse towards government and elected officials, appropriation of national symbols, and it goes on.
It mentions then the overwhelming majority of protesters have denounced violence or not directly aligned.
It talks about the wide range of participants.
If we just scroll down a little bit, the movement talks about the IMV aspect.
It's unlikely that premeditated violence will explain it will take place however the threat of lone actors scroll down again significant international financial support and publicity so it's sort of collating the information that was available then and then it says The Freedom Convoy itself,
or new entities that emerge from it, are likely to continue for several weeks and will seek new opportunities to protest, occupy and disrupt.
It may also embolden other groups and individual movements across the ideological spectrum.
There are also risks that the protests may serve to deepen and harden new and existing cleavages within Canadian society.
As the protests persist...
These feelings may become more entrenched and form the basis for longer-term societal schisms.
So this is a...
Can you speak to this a little bit and just situate the context in which all of this was being dealt with at the time by you?
So, as I said, I didn't have a domestic intelligence assessment unit at PCO.
And all of the intelligence assessment or collectors in...
The community have very narrow mandates.
ITAC does terrorist threat assessment.
CSIS does assessments in line with their act.
RCMP does criminal assessments and collects open source for law enforcement purposes.
I have a foreign intelligence assessment group that takes open source and covert.
Information and can give me a picture of what's going on.
And not just me, decision makers, the Prime Minister.
I didn't have an equal entity in PCO for open source, domestic.
And I asked Martin Green, the Assistant Secretary of the Intelligence Assessment Group, to start trying to think about what this could look like.
I was hoping this was a really interesting piece.
It wasn't exactly what I wanted in the minute.
I wanted more, here's what we're seeing tomorrow.
But a very useful piece where he tried to be very thoughtful about what this could mean based on known aspects of protests, what we were seeing in other countries.
Conversations with colleagues in other countries about similar phenomena and try to build an idea of what this could mean from an intelligence perspective, but what it would mean for government institutions, democracy, rule of law.
The things that we need to consider as senior public servants advising government.
Those are my questions for you today, Ms. Thomas, but before I sit down, is there anything we haven't covered today that you'd like to raise?
No, I don't think so.
Certainly, there's been a lot of focus on Ottawa, because it was significant, and it was at the footsteps of where our democracy is housed.
This was a national situation, and our concern about Windsor, as you've heard from other people, COOTS, the pop-up convoys across the country, the intelligence that we were getting about potentials in New Brunswick, Cornwall, the Peace Bridge, Via Rail protests, that all came together to form our view of what was going on and raise our level of concern.
So while yes, Ottawa was a significant event, this was a national crisis.
Okay, now if I could call on the convoy organizers, please.
My name is Brennan Miller and I'm counsel for Freedom Corp, which is the entity that represents the protesters that were in Ottawa in January and February of 2022.
I have a few questions for you and hopefully we'll be able to get through them.
Ma 'am, you had just mentioned, and I'm glad you did, the rule of law.
What's your understanding of the rule of law?
That laws are obeyed in the country, Canada, provincial, federal, and municipal.
Right.
And you agree with me that the rule of law applies to you, and it applies to the executive and the elected executive of the government of Canada?
Yes.
All right.
Would you agree with this, that the rule of law conveys a sense of orderliness and executive accountability to legal authority and vouches safe a stable, predictable, and ordered society in which citizens and residents may conduct their affairs?
It requires that government power or any authority delegated by Parliament must be exercised pursuant to values.
Do you agree with that?
I do.
All right.
Now, you can agree with me that Your position, your office, and I'll call it your office, the National Intelligence and Security Advisor, it's not been created by an act of parliament, has it?
No, it does not.
It's an advisor.
Right.
And you have no statutory mandate?
I do not.
And you've also got no legal powers yourself?
I do not, which I explained when I talked about what my role is.
Right.
And I take it you've never been an intelligence officer with CSIS or within the intelligence community, is that correct?
I have not.
And you've never been an intelligence analyst with CSIS or in the intelligence community, is that correct?
That is correct.
All right.
So you said in your evidence that you didn't feel that you were getting the proper intelligence or updated intelligence from law enforcement or from CSIS or weren't getting enough of it.
Is that fair?
I didn't say that about CSIS.
All right, so you were satisfied with the intelligence you received from CSIS?
I was.
And CSIS specifically told you and Cabinet that there was no Section 2 CSIS Act threat posed by the protest or posed by any of the actions going on throughout Canada at the time, did they not?
You're misinterpreting what CSIS said.
Can you tell me how?
Because I can put up the statement and the reports, because that's what it says.
But what they said and the interpretation of what they said are two entirely different things.
Their mandate is very narrow.
And so Section 2 of the CSIS Act is about the work that CSIS does and the intelligence they collect.
And they said they are not the only arbiters of what is a national security threat in this country.
Very true that they said that vis-a-vis their particular act.
Right.
And the thing is, is you agree with me that the CSIS Act, the meaning of security threat to Canada, is incorporated directly into the Emergencies Act, correct?
You're going to receive legal briefs on the Emergencies Act and the legal interpretation, and I am not a lawyer.
My understanding is that the Emergencies Act is assigned the meaning...
As defined in the CSIS Act, but is not limited by the CSIS Act.
Well, I don't know how that could be, but we can agree to disagree.
But you agree that the Emergencies Act, on its own reading, and I've put this to the Deputy Minister, you understand that it requires reasonable grounds that a Section 2 CSIS Act threat exists?
I don't agree.
That's what it says.
No, it says it assigns meaning as the language is defined in the CSIS Act.
But again, you'll get legal arguments.
Right.
I understand.
So you're saying that the CSIS Act and Section 2 of the CSIS Act, which is incorporated into the Emergencies Act, means something different when you're looking at it?
No, that's not what I've said.
So what do you mean?
I mean that in terms of the Emergency Act, the governor and council can consider more broadly than the intelligence collected by CSIS in determining a national security threat or situation or a public order emergency.
I understand that.
But you do agree that the four grounds of types of threats in Section 2 of the CSIS Act...
Are what is in fact required to have been found?
No, I don't agree.
So it can go beyond what the Act says, which is a threat to the security of Canada.
There are other definitions of threats to the security of Canada as we saw earlier.
Right, but not in the legislation.
The Emergency Act allows for the Governor and Council to make a broad decision about public order emergencies.
That's not what it says, but you...
Can agree with me?
I think that this is an argument to have with lawyers.
Well, I understand that.
So let's go through then just what Section 2 of the CSIS Act says, and I'll just ask you a couple of questions about the grounds.
And we've already heard from every law enforcement official, as well as we have these statements from CSIS and evidence, that they didn't have reasonable suspicion that any of this was taking place.
I take it that you can agree with me that you didn't have any evidence with you before Cabinet or even considered of any espionage or sabotage against Canada that is detrimental to the interests of Canada or activities directed towards or in support of such espionage or sabotage, right?
That's been discussed, yes.
Right, and so that there was no evidence of that that you considered.
No.
In your assessment.
And you can agree with me that there's no evidence of foreign-influenced activities within or related to Canada that are detrimental to the interests of Canada, are clandestine or deceptive, or involve a threat to any person, correct?
There were threats to people.
Right.
By email and Twitter, right?
I would submit that in the social media era, you cannot ignore threats against officials and public office holders, just because they are on social media, that would be inexcusable.
Right, but that's up to the police to deal with, or is that a national emergency?
It depends on the situation in which, in the context in which those threats arrive.
Can we please bring up document ts.nsc.can.001-0000206-rel0001?
Oh, apologies.
Just a second.
Wrong one.
I'll just say the end numbers.
Same forward.
159 _rel Okay, so I take it that you're familiar with the CSIS assessment that they provided on the Freedom Convoy in downtown Ottawa, right?
That's one of the assessments.
Right, okay.
And their assessment was this, and at the beginning you see downtown Ottawa was actually quite festive, not threatening to a passerby.
Some criminal acts did occur.
Law enforcement.
And again, you've said you're not an intelligence officer.
You don't have any training as an intelligence analysis.
So I take it you rely on CSIS for intelligence.
CSIS provides one input on intelligence, yes.
Yeah.
And then the RCMP?
Another input.
Right.
And then the Canadian Border Services Agencies?
Another input.
Right.
And then you also have the Canadian Security Establishment?
Yes.
Right.
Okay.
None of those people provided you intelligence that there was a Section 2 CSIS Act threat.
Again, we've been through this.
There are other measures other than Section 2 of the CSIS Act.
So let's scroll down if we can.
And you'll see in there with respect to the flags.
Now, I take it there was concern with these flags that there was a couple of flags that were seen that were inappropriate.
And that was one of the reasons why.
There was a consideration of ideological motivated violent extremism.
You can see there that I understand that their report is a very small number of more inflammatory flags, Confederate, Nazi, Swastika, 3% or Punisher based on the 1974 comic book hero and Quebec Patriot flag.
And then they say that A random flag is just a flag until the reason the person holding it explains why.
Flags can have multiple meanings and are routinely co-opt by various groups, individuals.
No way of connecting those views holding flags with any online content.
The presence of 3% flags, for example, does not necessarily mean that members of the 3% are in attendance.
And that was the intelligence you were given.
That's part of the intelligence we were given.
Intelligence that can be released.
Okay, so intelligence can be released.
Well, there's Section 38. Right, I understand that.
But why don't we scroll down?
Now, this is important.
And you know that CSIS does, in fact, because there's no reason, you don't need a law to look at what's online.
Or open-source intelligence, that it's open-source intelligence.
Anybody can look at it without a law authorizing it.
Can you agree with that?
No, the reality is that open-source intelligence has to be animized so that we are not targeting specific people who are not under investigation.
So it's not quite as simple as you're depicting it.
Well, ma 'am, again, there's no privacy interest for Canadians on things they post online.
Anybody can go on and read it, right?
You know that.
Yes, but the privacy commissioner and the privacy laws of this country are such that their information cannot be scraped and be part of an assessment writ large.
There has to be boundaries around that.
Around its distribution?
No, around its analysis and collection.
Right, and that's why we have units in the RCMP that do that.
Some of it, yes.
Right.
So you have the, I believe it's called the IMCIT unit.
That's all they look at, is they look at online violent rhetoric and assess it.
For criminal purposes, yes.
Right.
And so what, for violent rhetoric, what are your other purposes other than criminal purposes?
Well, so I would like to be a little more expansive in this answer, if I may be.
An analyst looks at, A piece of information for very specific issues.
When we, as people advising, and it's my Deputy Minister colleagues and I, to advise the Cabinet and decision makers on the threat, the confidence in government institutions.
The rhetoric, we have to look more broadly than at specific elements as described here.
Someone should kill the PM.
Wouldn't it be great if someone killed the PM?
That says something, and it's not just random because they can't identify it to an individual, and it doesn't say the date doesn't mean it doesn't matter.
So what are you looking for?
Are you looking that the government without warrants is allowed just to go and look into metadata?
No, that's what I just said to you.
I just said to you that we should not be doing that, and so we have to find a legal framework for it.
We are actually violently agreeing.
Okay.
Well, that's good.
And we agree that we should follow legal frameworks.
We should.
And I believe there is a gap in the legal framework.
And you agree we should follow the legal framework in the Emergencies Act, right?
And we have.
Okay.
And then, can I just show you that part up there?
CSIS assessed this.
Excuse me.
We've never established the date of this document.
Can we see what it's stated, please?
Freedom Convoy 2022.
It's an assessment of CSIS.
I believe it's been referred to in the statement.
It's from your production.
I assume that it's relevant in material.
I'm not arguing that.
I'm just asking to establish if there's a date on the document, perhaps at the last page.
No, but I understand that, and the witness has accepted, that this was one of the assessments that was before Cabinet.
Well, no, I didn't say it was before Cabinet.
I said it was produced.
Okay.
And I believe it was before the concrete arrived.
CSIS had assessed the anonymity of the online space allows individuals to post commentary that they would not normally say in public.
Many of the posts in this space are best articulated as shit posting.
Confirmation bias.
Strategic analysis must be driven by direct evidence collection and assessments as opposed to a reliance on social media posting, lax context, and where the poster bias may not be considered.
So that had been given to you by CSIS.
And do you not agree with that?
I believe that it is an analysis done by an analyst, and that is the National Security Intelligence Advisor, the Prime Minister.
When I see social media posts growing in number and aggressiveness of language that says somebody should kill the PM or somebody should kill the DPM, I have reason to be concerned beyond what the analyst is concerned about.
Okay, so I'm just going to run over very briefly.
What I understand your position is, and your position as National Security Advisor, I've managed to find the policy with respect to your position.
So if you can agree with the following, this is what you are to do.
The National Security Advisor to the Prime Minister and Associate Secretary to Cabinet assists the Clerk and provides information, advice, and recommendations to the Prime Minister as follows.
As Associate Secretary to Cabinet, he or she can act on the Clerk's behalf on any of the policy and operational issues that come before the Privy Council.
As National Security Advisor to the Prime Minister, he or she ensures the effective coordination of Canada's security and intelligence community and, together with the Deputy Ministers of National Defence, is responsible for the communication security establishment.
The National Security Advisor also oversees the provisions of intelligence assessments to the Prime Minister, other ministers, and senior government officials.
The National Security Advisor to the Prime Minister is supported by two secretariats via the Foreign and Defence Policy Advisors to the Prime Minister, Security Intelligence and International Assessment Staff.
That's what your job is.
That's an old version of the job description, and there's been some changes to it since then, but sure.
Right.
You are not in the business or your department is not supposed to be in the business of actually collecting intelligence yourself.
We don't collect intelligence ourselves.
But I thought you'd said that it was looked at, you were setting up your own bureau or what have you to look at online rhetoric and do your own open source intelligence.
What I said is that there is no one doing that in a broad sense.
I saw it as a gap.
I need to do something about it.
I don't have the legal mandate right now to do it.
The OSINT document you saw previously is all obtained through legal means as an analysis.
What we need is a more, we need a unit in PCO or public safety that is more akin to the foreign intelligence assessment unit that takes covert and overt information and makes assessments.
We don't have that domestically.
It is a gap.
I don't have a solution for it yet.
And I won't be the sole person who decides whether it happens or not, but it is something that we need to look at and I'm exploring.
That's my job.
Why would you need that outside of the civil service who are governed by legislation that collect intelligence?
It would be part of the civil service, just like the Foreign Intelligence Assessment Unit is part of the civil service.
Right.
But the Foreign Intelligence Service, like the International Assessment Staff and Foreign Intelligence Service, you had the information from them, I take it.
When the cabinet made this decision, did you not?
They were assessing foreign intelligence, not domestic intelligence.
And domestic intelligence was being assessed by the RCMP.
Who assess also foreign intelligence.
Right.
CSIS.
Who also assess foreign intelligence.
The Canadian Security Intelligence.
Who also assess foreign intelligence.
And they also look at domestic intelligence.
Some of them do.
CSE does not.
So just as those units all have mandates to...
Collect and do some assessment.
We see that raw intelligence and we make assessments of it on the foreign side.
I would like an equivalent on the domestic side.
I don't have that now.
I believe it is a gap.
So why is what the RCMP does already doing that with their reports?
They have two sets.
They have the IMVE assessments online.
They have the onset assessments online.
Why is that not good enough for you?
Because I would like to look at, just as we do with foreign intelligence, all the various pieces in totality rather than institution by institution.
It's part of our job to get a holistic picture.
And it's your job, according to this description, to effectively coordinate all that anyway.
Right, but I need to have people with a mandate to do that assessment, which is I coordinate the function and the issues, the issues management of what's going on in the national security community, but not necessarily their intelligence assessment.
How about this?
What if they just got rid of your position and left it to the director of CSIS to do what you do?
So, the Director of CSIS is not the only person who is responsible for security in this country.
That's number one.
You can certainly make that recommendation to the Governor and Council if it's useful to you, but there are more people than him involved in assessing national security in this country.
But it's nothing passed by Parliament, right?
Parliament...
The Pretty Council office is an established office that is the...
Essentially, the Prime Minister's department, we coordinate information, we challenge, we provide policy advice to the Prime Minister, and I am part of that mechanism.
I understand that, but you can agree that Parliament has given you no mandate to do that with respect to intelligence?
I don't agree with how you framed it.
Parliament?
I don't agree with the basic premise of your challenge.
Well, here you go.
Yes or no?
Has Parliament...
Via statute, giving you, the National Security Advisor and the Privy Council, authority to collect and then analyze intelligence.
The Foreign Intelligence and Assessment Group is a long-standing group that, no, Parliament hasn't given it authority, but it exists and it continues.
Okay, next is the City of Ottawa, please.
Good afternoon, Ms. Thomas.
My name is Anne Tardif.
I'm one of the lawyers representing the City of Ottawa.
You discussed the IRG, or Incident Response Group, this afternoon, right?
Yes.
And I heard that that's a committee of cabinet that also includes officials who are subject matter experts.
Is that correct?
Yes.
And it's chaired by the Prime Minister?
It is.
And its purpose, if I understood you correctly, is to make quick, rapid decisions.
Let's just go with rapid decisions about issues of national importance or crises.
Yes.
Including COVID.
Yes.
And you gave a number of other examples, right?
I did.
And it's the committee that is the most effective in dealing with crises.
Yes.
And my understanding is it met first on February 10th.
It did.
And that was, of course, day 13 of the convoy here in Ottawa.
Is that correct?
That's correct.
And I think, as you mentioned earlier, we were, in fact, going into our third weekend in Ottawa.
Fair?
Yes.
And the Commission has heard some evidence that, in fact, weekends were more volatile.
Is that right?
Correct.
At least in Ottawa.
I'm just talking about Ottawa.
Okay.
And Commission Townsend took you to...
The minutes of that IRG meeting, I won't turn them up, but I'll give the reference for the record.
It's SSM.nsc.can.50209.
And you had reported, if you need me to turn it up, I will, but you had reported that in Ottawa, the situation at that time remained largely unchanged.
Do you recall that?
I do.
So the reason then that the IRG was convened at that point was not because something new or something had changed in Ottawa.
Fair?
Fair.
And, you know, you're perhaps seeing where I'm going here.
I'm assuming it had something to do with the blockade in Windsor and perhaps concerns about other protest activity outside of Ottawa in addition to what was going on in Ottawa.
That's a fair comment.
The Clerk of the Privy Council, Jan Charette, decided that briefing a group of ministers who were largely the ministers in the responsible departments for the national picture and the Cabinet Committee, SSE, which was meeting quite regularly, while they had been effective, it was now time for an IRG and the Prime Minister to direct in a different way.
Right.
Just to sort of close a loop on this, the SSE committee had met, I think it's three times prior to February 10th, correct?
Yes, correct.
And the decision to invoke or convene, pardon me, the IRG represents an escalation of the federal government's response.
Is that fair?
I would say that's fair, but it's best raised with the Clerk of the Privy Council.
Understood, and we'll do that then.
Thank you.
The other document I want to take you, or I guess the only document I'll take you to is, these are the...
I can put it up if I need to, but in the interest of time, I can maybe just put it to you.
I was going to take you to the minutes of the cabinet meeting of February 13th and your mention of a breakthrough.
Do you want me to put it up?
I'm happy to.
Can you just tell us what you were referring to?
I was referring to the reports of a negotiation between the mayor and convoy organizers.
And can we then turn up pb.nsc.can.403245?
And bear with me, Ms. Thomas, this is the last document I'll take you to.
the only and the last.
So these are talking points that Commissioner Luckey sent to you and Minister Mendicino on February 14th, correct?
Correct.
And if we scroll down to page three, Mr. Clerk, thank you.
Yep, moving back to Otto, if we scroll down a little further.
Down, down, down.
There we go.
This is the agreement, I take it, that was being reported and that you're referring to in the last two bullets.
Now we're at the 14th.
I appreciate we're the day after cabinet, but this is the same agreement, right?
And if we, I won't read it, but that's what's described there in those bullets.
Yes.
Last two bullets on page three.
And scrolling down to page four, Mr. Clerk, there's the rest of the description.
Just in fairness to you, Ms. Thomas, that's the agreement.
Yes.
Right?
Okay.
And you'll see there the final bullet on the page.
Well, the third bullet from the top.
While this is a step, this being the agreement in the right directions in terms of reducing the trucker's footprint and impact on Ottawa, it is not a win.
That's what Commissioner Luckey was reporting to you.
Right?
Yes.
And do I understand that to mean it's a step in the right direction, but by it's not a win, it's not going to bring the whole convoy to an end.
Is that what you understood?
Yes.
Excuse me for interrupting.
I just want to be clear.
If you go back to the top of page one, we have an issue again with the date stamp.
You said February 14th, but if we subtract the five hours, it's the evening of the 13th.
Thank you very much, and I apologize.
I confess I've never quite gotten that Greenwich time down.
So, Ms. Thomas, you understood what your counsel said, so I apologize if I misled you.
I'm not great with the time change.
Thank you, counsel.
And the last point I want to take you to is that final bullet.
Commissioner Luckey reports this agreement complements the plan to reduce the footprint through the work of the public liaison team.
Integrated Command Planners, and that's a reference to the Integrated Command Planners in Ottawa, correct?
Correct.
Need to now incorporate this development into their resource and enforcement plan.
And that's the information you had in the breakthrough, potential breakthrough to the extent you were aware of it.
Is that correct?
That is correct.
Thank you very much, Ms. Thomas.
Those are my questions.
Okay, next the OPS please.
Good afternoon, Ms. Thomas.
My name is David Michikowski, and I'm counsel to the Ottawa Police Service.
I understand that as the, I'll use the acronyms because it's shorter, as the NSIA, it's your job to assess information and to advise the Prime Minister and to coordinate the flow of intelligence and information from federal agencies to the Prime Minister and to the Privy Council.
Is that right?
Yes.
And in looking through the documents, and I'm happy to call it up if it's necessary, but I don't think it's contentious.
There's a message from Zita Estraves to Bill Blair, I believe.
Are you familiar with Zita Estraves?
I am.
And is that his chief of staff?
Yes, she is.
And so I think what she indicates, and this is on January 25th, is that the ADMs are meeting on the trucker convoy.
And then she says that the NSIA is proactively engaged in Hill security and that Intersect will be holding a call on January 27th.
Do you agree with that?
I do.
And then if we could call up Mr. Clerk, pb.nac.can.50577.
There is a report on January 27th in which you asked for an update.
Is that right?
I believe so, yes.
And in that report, if we just look at the first paragraph or the second paragraph, it indicates that all key stakeholders, so that includes the RCMP, the OPP, OPS, PPS, various other entities, are actively planning and collaborating to ensure public safety.
You'd agree with that?
I would.
And in the second paragraph, we see that it is also planned to be a peaceful demonstration.
Is that correct?
That's correct.
And you can take that down.
Thank you very much.
And I understand there was an ITAC report on January 26. And again, I won't turn it up unless you need to see it, but it is...
TS.nsc.can50156.
That ITAC report notes that the majority of the trucks are exercising, of the truckers, are exercising their right to peaceful protest.
Is that right?
That's correct.
And then there is another ITAC report, I believe, the following day, which is pb.can401237.
And it indicates at that point, so this is January 27th, that a dedicated group could prolong that protest until January 31st.
Do you recall that?
I do recall it.
And it's still, however, expected to be peaceful, although recognizing that some extreme views of a vocal minority are on social media advocating, correct?
Correct.
And then there's an intersect meeting on January 27th.
So the OPP, RCMP, PPS intersects purposes to Collaborate on emergency preparedness and to provide situational awareness?
Correct.
And so I could turn up the report if you need to see it, but I see in that Intersect report, and maybe you couldn't confirm, that we do see in that report that the plan is the trucks are going to be on Kent Street, they're going to be on Metcalf, they're going to be on Wellington.
You were aware of that from the Intersect report?
I was.
In a memo you received on January 28th, you again expressed, and I guess this is on the Friday, that the organizers of the protest had at that point expressed the intent for a peaceful event, correct?
I expressed that or it was sent to me?
It was expressed to you, I'm sorry.
Yes, correct.
And on January 26, so going back two days previously, Mr. McDonald, Mr. McDonald reports to you, is that correct?
He does.
He indicated to you that the, in terms of public communication, that public communication was taking its cues from the Prime Minister and emphasizing the lawful nature of protest.
Yes, I remember reading that.
Right.
And so there'd be no basis at that point for law enforcement to stop the protest at that stage, correct?
Not that I'm aware of, no.
And on February 1st, you gave a talk to something called Canada and the World Committee?
Yes, so that's the...
Partner committee to the safety, security, and emergency management meeting where it looks at policy and emerging issues essentially about Canadian foreign and defense policy.
Okay, and I see at that talk, which was on February 1st, that even though you indicate there's some disturbing behavior that you've now seen, you noted that the protest had largely remained peaceful.
And that all levels of law enforcement had worked together with federal officials to ensure planning for a safe protest and that national security would continue to work closely with law enforcement.
Correct.
I want to move on and talk about negotiation and de-escalation as a method of resolving protests and demonstrations.
The Commission took you to a memo from Mike McDonald to you.
And in that memo, the question was asked, and this was on January 25th, as to whether MPs should meet with the convoy while in Ottawa and whether it was safe and if there was advice for them.
Do you remember that memo?
I do remember that memo.
And that question wasn't answered at that time as to whether MPs should meet with them, correct?
Correct, and partly because it was not for ADM NSOps to make that determination broadly.
And you would agree with me that sometimes enforcement action can have undesirable results, correct?
It has, yes.
If we could turn up ssm.nsc.can.
Five zeros, 292.
And if we turn to page five.
That was the cabinet, the SSE meeting.
Yes.
And so you'll see on page five, number six, if we scroll down.
Yes, thanks very much.
You'll see it was brought to your attention, this is on February 3rd, that the Ottawa Police said that they could not bring the protest to a conclusion without the assistance of the federal government due to public safety concerns and risks that enforcement would provoke some protesters, correct?
Yes.
And at that meeting on page six then, item four.
You had indicated that the protest organizations have indicated an interest in negotiations, but no one had reached out to them, correct?
Correct.
And then on page eight, there was a chart with a list of...
Various options.
And one of the things we see in the third box on the left-hand side is engagement with protesters and the question of a dedicated minister.
So this is on February 3rd that's raised, correct?
A dedicated minister amongst others.
Certainly not as the only option.
Right, to engage with them.
And then if we go then to the February 6th SSE meeting.
And again, I won't turn it up in the interest of time, but if you need it, do let me know.
I see at the February 6th meeting, there's a reference to the Deputy Minister reiterating the views of provincial colleagues that negotiation is the preferred option for resolution.
Do you recall that?
I do.
And you participated then in a call with the city and the federal officials and Chief Slowly that the commission took you to earlier this afternoon.
And there was a discussion about negotiation resolving the situation at Confederation Park rather than going tactical.
Do you remember that?
I do.
And you expressed enthusiasm that a tactical takedown was avoided by negotiations, correct?
Yes.
And the Commission took you to your talking points on February 8th.
And I see in those talking points that the Mayor of Ottawa had requested that the Prime Minister of Canada appoint a mediator.
Do you recall that?
I do.
And when I looked at the IRG minutes of February 10th, I saw that Public Safety Canada reported on a conversation with the lead OPP negotiators that raised the possibility of the protesters leaving and denouncing the blockades in exchange for a commitment to register their message with the government.
Do you recall that?
I recall it being said, yes.
And that came up again, I saw at the IRG in the tracker of February 12th.
In fact, you're shown as the lead to engage a federal interlocutor at that meeting, correct?
I don't recall being the lead, but certainly Deputy Minister Stewart was leading the discussions.
Who would be the interlocutor?
Names were put forward.
I don't think I was ever identified as the single lead.
I just need another three minutes, I believe, to finish off this point.
Yes, if you didn't go over the same documents, each witness and focused on key, that might shorten your time, but I'll let you go.
I'm doing my best.
And so...
You indicated that there wasn't an interlocutor.
And one of the things that you mentioned to my friends earlier this afternoon was that the negotiations in Windsor had failed, correct?
Correct.
And when I looked at the document, and I won't take you up to it, but it is pbnsc.can402963, I see that...
Deputy Minister Stewart at that time told Mr. Mendicino that it failed in Windsor because it was given to them late at night and the enforcement was starting the next morning.
Correct?
That is what Deputy Stewart said and is in that memo.
And so I just want to take you to one last document.
And it was a timeline that had been provided by, I believe it would have been prepared by DOJ.
Do you recall that timeline?
I can't tell you that I recall the specific one you're referring to.
We had multiple timelines.
And so when I looked at that timeline, there was a space on it for meetings.
And I'll show you the timeline.
Just to make it easier, it's pbnsc.can.
I'm sorry, I'm giving you the wrong document number for the timeline.
The timeline had two columns on it, and it had a column that said meetings, and then it had federal decisions.
Do you remember that?
I don't recall the document you're speaking of.
Okay.
And when I looked at that document, and it started prior to the convoy, and it went right up until past the emergency.
And what I saw on the right-hand side was lots of meetings, dozens of meetings with various committees.
But when I looked at the—and you'd agree that that occurred?
Yes.
And when I looked at the column that said federal decisions, pages 1 to 21, although there were dozens and dozens of meetings and suggestions about a federal mediator or a negotiator, none of that ever happened.
And the only federal decisions that took place from the start of the convoy to February 14th...
We're on January 28th.
Government buildings were locked down.
The airspace over Parliament on January 29th was closed.
And on January 29th, a request by Ottawa police to use a parking lot at Carche Drill Hall was approved.
And on February 3rd, a request for RCMP resources was approved.
And that's it until the Emergencies Act.
That doesn't reflect the significant amount of engagement, consultation, work with provinces, Ontario in the particular case of Ottawa, which is what you're concerned about, to try and enforce provincial law, the Highway Traffic Act, as an example.
And so it wasn't achieved, which is part of the problem.
Right.
And so the one thing that the protesters wanted was a meeting with somebody in the federal government.
They have that meeting in this process, but they never got that meeting before passing the Emergencies Act.
Is that right?
And as was discussed earlier, the reasons why were explained.
Okay.
Thank you very much.
Those are my questions.
Okay.
Next, if I could call on the CCLA, please.
Can you see and hear me okay?
I can't really hear you.
Okay.
How about now?
That's great.
Thank you.
Okay, great.
My name is Kara Zwiebel.
I am counsel for the Canadian Civil Liberties Association.
If I could get the clerk to put up just the witness summary, WTS 6071, and go to page 11. I don't know if we'll need to refer to this, but just so you have it in front of you.
Your view, as articulated in your witness summary, is that the reference to the CSIS definition in the Emergencies Act should be reconsidered.
Is that right?
Yes.
Okay.
And in your witness summary, there's a statement that the CSIS definition requires the existence of a known actor carrying out activities in support of the threat of violence against persons or property, correct?
A known actor or group, yes.
Okay, and your colleague Assistant Secretary McDonald said that in order for the 2C definition to be met, CSIS targets would have to move from using rhetoric.
You've...
You've cut out your or you're freezing.
We'll have to get her back.
I'm sorry, are you there?
I've lost the picture of the...
Okay, you're now back.
Oh, okay.
Thank you.
Sorry.
Is that a statement that you agree with?
The definition as into, yes, I think that it needs to be modernized, just as the Director of CSIS has indicated that the CSIS Act needs to be modernized.
That element does as well.
Okay, but the statement that...
In order for the 2C definition to be met, CSIS targets would have to move from using rhetoric to inciting or curing of serious violence.
I'm going to suggest to you is a misunderstanding of the CSIS definition because individuals can't be targets of CSIS if they haven't already determined that there's been, if that 2C threshold, that threshold has been met.
Would you agree with that?
I would.
Okay.
And your view is that the CSIS definition you've said before of threat to the security of Canada is very narrow.
Very narrow and outdated.
I'm not saying it should be broadened.
I'm saying it should be modernized.
But it needs to be reviewed.
Sorry, not trying to interrupt you.
Because you understand why there should be a high threshold before the state can start engaging in surveillance of its citizens.
I don't disagree with that at all.
I didn't say it should be broadened.
I said it should be modernized.
Right, because expressing unpopular political views shouldn't be enough to engage the surveillance apparatus of the state.
And that's not what I've said.
Okay, and disagreement with the government should not be enough?
I agree.
But your view is that the Emergencies Act should have a broader definition of what constitutes a threat to the security of Canada.
Is that right?
I think that...
Both acts were written in the 1980s, and they both need to be modernized to reflect the reality of the nature of threats that are occurring in 2022.
Okay, but again, you understand that in the case of the Emergencies Act, there are reasons why we would want a high threshold.
I'm not disagreeing with the threshold.
I'm just speaking about an act that was written 30 years ago.
That needs to be modernized to reflect the reality of the kinds of threats that exist in the world today.
Okay, and we'd want a high threshold because the Emergencies Act allows the government to bypass the parliamentary process and rule by executive order, at least for a brief period of time.
Right, but does allow for all the transparency of going through the parliamentary process and for processes like this one.
So, I am not saying that the government should have more expansive power or a lower threshold.
I'm saying that the Act should not sit 30 years untouched.
Okay, there's no disagreement there.
I mean, I think we probably have different characterizations of what's a high threshold.
You also understand, and maybe...
I'm not sure if this is the case.
I was trying to follow your answers to my friend, Mr. Miller.
But although you believe that the definition should be reconsidered in the Emergencies Act, you understand that currently the definition of a public order emergency in the Emergencies Act is tied exclusively and exhaustively to the definition in the CSIS Act.
The federal government legal opinion is different, and there will be legal arguments to that, and I'm not the person to make that argument.
Okay.
One other area I'd like to cover.
Your office, you've mentioned, is a consumer of intelligence, and you receive intelligence from CSIS, CSEC, ITAC, Global Affairs, Foreign Intelligence Partners, all of those?
Correct.
And in this case, I think there was also mention in the witness summary of receiving information from the CBSA, from Immigration and Refugee Citizenship Canada, from the Parliamentary Protective Services, and from the Department of National Defence.
I actually don't receive anything personally from Parliamentary Protective Services, but the rest are true.
Okay.
On the IRG minutes that you were taken to earlier by Commission Council, that tracker.
That was a place where you had identified this intelligence gap that you characterized it as.
And it said there, open source, non-criminal, non-terrorist.
So I just want to put a proposition to you, and you can tell me if you agree or disagree.
And that proposition is this, that the difference between a society where individuals are monitored by the state...
Where there are no grounds to believe that they are going to engage in criminal or terrorist activity, and one where they are not, is the difference between a surveillance state and a free society.
Is that a proposition that you would agree with?
Well, that's exactly what I've said, that we need to understand trends, but we don't need to understand.
We need to animise that information so that we're not tracking individuals.
So I agree with you.
I just think that we have to have an understanding of Growing threats that are not yet at a threshold or potential that they're under a CSIS investigation or a criminal investigation.
That when there is something like a convoy, as we saw here in Ottawa, and there is open source information that we're going to target a school and we're going to do a slow roll around the school.
That information maybe is being monitored by the police so they can do something.
I don't actually know, but there needs to be an understanding that the individual said that isn't under a criminal investigation.
We're not even sure that the behavior is criminal, but it says something about what is happening in the middle of a crisis or an incident.
I don't want to know who said it, and I need a legal framework to do this.
So it's not monitoring.
It's not...
It's not individuals.
It's understanding trends, just as we do with foreign intelligence.
And so I would like to agree with what you're saying, but I don't actually agree with your framing of it.
Okay.
In terms of what I am proposing is required.
Okay.
Okay.
You're well out of time, so you're going to have to wrap up.
Okay.
No, that's fine.
I'm done.
Thank you.
Thank you.
uh next uh call on the council for former chief foley Good evening.
Rebecca Jones for Council for Former Chief Slowly.
Ms. Thomas, am I right that your very impressive experience does not include experience within a police department?
Like all of my predecessors, that's true.
And so that means that you don't have specific experience figuring out resource requests for public order operations, for example.
No, I would rely on experts for that information if I required it, and I'm not sure I would.
Right, okay.
And that's exactly what I was going to say, is that you would rely on experts such as the RCMP or your colleagues in public safety, emergency preparedness, that sort of thing for that information, correct?
And you've testified about the incredibly complex situation occurring in Ottawa, which you saw as a national security threat, right?
Yes.
And we've now heard a whole parade of witnesses who, while disagreeing on a lot, have all agreed on a couple things.
First, that the protest was unlike anything they had ever seen, right?
And second, that the OPS did not have the resources they required to end this occupation until around February 17th.
Correct.
Okay.
And the commissioner of the OPP testified that ultimately over 2,000 officers were required to end the occupation, right?
Yes.
Okay.
Now, what I want to do with my time with you is to explore resource requests and specifically What the federal government, through you, understood about the resources that were being provided to the RCMP, by the RCMP, to the OPS and Chief Sully.
So, if we can pull up, please, OPS 6093.
to page four, please.
So, this is an email from Chief Slowly to the Commissioner of the RCMP, and if we scroll down on February 2nd, I should have said, and then if we scroll down, we see a request to the RCMP for 50 Uniformed Members.
A level of leadership to provide support for teams and three public order units, right?
Yes.
And if we scroll up, we'll see that Commissioner Luckey advised Chief Soli in the first paragraph there that she had reviewed the request with her team, but that the RCMP was experiencing a draw on their resources and were not able to provide that assistance, right?
That's what the letter says, yes.
Okay.
And if we scroll up, we'll see that by the 3rd, it was still the case.
If you go all the way up.
Well, in any event, it says that by the 3rd, those resources still hadn't been provided and there had been no promise to provide them.
That's what the email says.
Okay.
And were you following this?
Not in this level of detail at all, nor have I ever seen this.
Okay.
Yes, I'm reading what's said and agreeing with you.
Perfect.
And so that's what I want to know.
You would have been relying on the RCMP to be dealing with these resource requests and then briefing you.
Yes.
Okay.
And the Deputy Minister of Public Safety and the Minister of Public Safety, in fact, more than me.
Right.
Everyone would be relying on the RCMP with respect to these resource requests.
Okay.
I'm not going to pull it up in the interest of time, but on February 3rd in the evening, Minister Mendicino tweets that the RCMP has approved all additional officers requested.
And we heard evidence.
Have you watched the evidence of the RCMP yesterday?
As much as I could.
Okay.
And we heard from Deputy Commissioner Duhaime of the RCMP that there was a mix-up, that those officers that were requested, there was a statement made that 250 officers had been provided by the RCMP, but that was a mix-up.
Did you hear that evidence?
I did not hear that evidence.
Okay.
And we also heard evidence from Commissioner Luckey that until after February 2nd...
The number of RCMP members deployed to Ottawa did not go above 50 or 60 officers.
I did not hear her say that.
Okay.
At the time that, leading up to, let's say, the period of the mayor's letter requesting the 1800 resources on February 7th, leading up to that time, is it fair to say that you...
We're under the impression from your colleagues at the RCMP that all of the resource requests being made by the OPS were being fulfilled.
I can't say that unequivocally.
We knew that the RCMP was stretched.
They had resources that they had to redeploy from across the country to Ottawa, and they also had a responsibility for their protective units.
I would need the numbers in front of me exactly and to recreate data to be able to answer that unequivocally.
I'm willing to say that there was confusion about the number of RCMP provided.
Right.
And I'm not asking you to actually comment on the deployment levels, but rather the understanding of the government, as we saw in Minister Mendicino's tweet, that everything that OPS was asking for from the RCMP had been fulfilled.
In that I don't know the conversation between Commissioner Luckey and Minister Mendicino, I prefer not to comment.
Okay.
Okay, so why don't we move forward then to the mayor's letter.
We don't need to pull it up.
You're familiar with the letter requesting the 1,800 officers, right?
Right.
And the following day, you briefed cabinet.
it and if we can pull up SSM NSC CAN 246 please.
So this is the day after the resource request.
And if we look at the fourth bullet, this is your briefing.
You say the chief continues to communicate publicly his view that OPS lacks resources to effectively manage the situation.
This may be somewhat true, but may also be a strategic tactic.
So I want to just break that down.
This may be somewhat true.
We can now agree that it was true that the chief required those resources, correct?
Correct.
At the time this was written, I would not necessarily have seen that letter.
Because it didn't come to me.
The letter about the resources that were being requested.
Right, from the mayor.
Okay, so when you're commenting on the OPS lacking resources and you're saying it may be somewhat true, what I'm asking you now is you'll acknowledge now that you know it was entirely true that the OPS lacked those resources.
I know in retrospect for the size the convoy grew to and the way it became entrenched in the city, Chief Slowly did not have the resources to manage it.
Perfect.
And then you say it may also be a strategic tactic.
And I take it that that wasn't something you arrived at yourself.
It was something that you were being briefed on?
Yes, that's correct.
And who briefed you on that?
The commissioner of the RCMP.
Okay.
So she told you that the request for resources may be a strategic tactic.
Correct.
Okay.
Can we agree that this kind of communication to cabinet would lead Cabinet and federal government officials to question what the OPS was asking for in terms of resource requests.
Without betraying what was discussed in Cabinet, I think that ministers were very open to understanding what OPS's needs were.
Right, but we'll see that what they're being briefed on is that this request might be somewhat true, but might be a tactic.
And that was the thought at the time.
Right.
And we now know that was incorrect.
Correct.
Okay.
And then you testified a moment ago that you weren't really sure what the RCMP was saying in terms of whether they had fulfilled all resource requests.
We now know that there was the request for the 1800 on February 7th.
And what I'm curious about is that there are Multiple times after that date, where the RCMP was still indicating that it had provided all resources that the OPS had requested.
Do you remember that?
I actually can't say that unequivocally.
Okay, so why don't we quickly pull up SSM NSC CAN 209.
So we've looked at this a couple of times today.
This is the February 10th Incident Response Group meeting.
If we go to page 5, if you look at the first big paragraph right in the middle, you see the sentence, the RCMP has provided all resources requested by the OPS.
That's what I would have been briefed.
Right.
And that's all I'm asking is, does that refresh your recollection that you were still being briefed after the mayor's letter, that the RCMP had provided all of the resources that the OPS had requested?
I can agree with that.
What I can't say is that I knew about the mayor's letter or saw it at the time.
That's a different issue.
Okay.
Different issue.
So I couldn't see them.
I can't.
Yes.
Okay.
Okay.
We're agreeing.
We're agreeing.
You were not doing your own assessment about whether or not OPS had all the resources they asked for.
You were relying on the RCMP.
Correct.
And the RCMP is still telling you on the 10th that they are providing all of the resources that the OPS requested.
Correct.
Okay.
And my one question would be, did the OPS request 1,700 or 1,800 resources of the RCMP or of?
Of police support writ large and I don't know the answer to that.
And the answer and I can tell you the answer to that was from both federal policing and provincial municipal police.
Okay.
Okay.
Thank you.
Those are my questions.
Thank you.
the Democracy Fund, JCCF.
Hi, Ms. Thomas.
I'm Rob Kittredge, counsel for the Justice Center for Constitutional Freedoms.
I only have 10 minutes with you today, and I'm going to try and cover a fair amount of territory.
So to the extent possible, if you can give me yes or no questions or yes or no answers, that would be very helpful.
Obviously, answer where you have to.
But if we can plow through this, that would be great.
I imagine your job comes with a pretty high-level security clearance.
Would it be fair to say that there's no intelligence information that Cabinet or the PM is cleared to see that you can't see?
That's true.
You attended the incident response group meetings where the invocation of the Emergencies Act was considered and regularly briefed the PM on national security issues during the period leading up to the invocation of the Act, right?
Yes.
You would know about any protest-associated acts or threats of serious violence that Cabinet, the IRG, and the Prime Minister knew about when they were considering whether to invoke the Emergencies Act, right?
As I've said earlier, not necessarily.
Not necessarily.
Right.
So I'm cleared to see everything.
That's different than seeing everything.
Okay.
Cabinet, the IRG and the Prime Minister were aware that CSIS had determined that the protests didn't pose a threat to the security of Canada, as that term is defined in the CSIS Act.
In the very narrow confines of the CSIS Act.
Right.
Cabinet, the IRG and the Prime Minister were aware that CSIS was concerned that invoking the Emergencies Act risked further inflaming IMVE rhetoric and could give rise to a risk of serious rhetoric.
Is that true?
Yeah, that was a responsible act to do that analysis by ceases.
You're not aware of any acts of serious violence associated with the protests in Ottawa or at border crossings, are you?
It depends on the definition of serious violence.
There was continual violence in the streets of Ottawa, but there wasn't anything that you could point to like January 6th.
And, I mean, when you say continual violence, what kind of level of violence are you talking about?
As has been reported by the OPS and by the city and by the residents who have testified, harassment, people being followed, people being intimidated, the noise, the pollution, the mess.
Right, but not serious violence.
There were some incidents that were early reported, but I don't know if they...
You know, the outcome of them was directly related to the convoy participants or just the general atmosphere in downtown at that point in time.
Okay, but you can't point me to an example of an incident of serious violence.
Not serious violence.
All right.
There wasn't any espionage associated with the protests or blockades, was there?
That's already been established, no.
Right.
And there wasn't any sabotage?
Not as it's defined in the CSIS Act.
Right.
And CSIS found no indication of foreign state interference at the protests.
And you don't have any reason to disagree with their assessment, do you?
Your interview summary says, the National Security and Intelligence Advisor assesses intelligence and advises the Prime Minister on national and international threats to the security of Canada.
When you use the term...
Threats to the security of Canada there, that's used in a general sense and not in the restrictive sense set out in Section 2 of the CSIS Act, right?
It's in a broad sense.
Right.
In other words, in your role as National Security and Intelligence Advisor, you're not governed by the CSIS Act.
The information I receive from CSIS is...
Sure, but your assessment of what a threat to the security of Canada isn't governed by the CSIS Act.
You advise the Prime Minister on anything you consider to be a threat to the security of Canada, whether those threats meet the definition set out in Section 2 of the CSIS Act or not, right?
No, that is, you're misrepresenting.
I would not brief on a threat where I did not have intelligence from one of the intelligence agencies that I had thoroughly discussed with the intelligence agencies.
Right, but what you consider a threat that's worth bringing to the attention of the Prime Minister might be something that doesn't strictly fall into the limited definition of Section 2 of the CSIS Act, right?
Yes, but it would be very much consulted with the heads of those agencies.
Sure, but you're not as restricted in scope as CSIS is.
Okay.
In the time leading up to the invocation of the Emergencies Act, you felt that the protests in Ottawa and at border crossings constituted a threat to the security of Canada, right?
I did.
But not in the sense contemplated in Section 2 of the CSIS Act?
Correct.
All right.
In your interview summary, you say that CSIS's legal mandate obliges it to assess threats to national security through a very narrow lens.
Do you remember saying that?
I do.
And that narrow lens basically boils down to the definition of threat to the security of Canada, as set out in Section 2, right?
No.
CSIS is restricted in terms of the threshold they have to meet in order to open an investigation to get a warrant and pursue collecting intelligence.
There are threats to Canada that are broader than that.
Foreign interference is a threat to Canada, as an example.
That doesn't fall under that definition of the CSIS Act.
Okay.
If I'm understanding your testimony earlier, it's your opinion that the Emergencies Act doesn't require a Section 2 threat to the national security of Canada.
That's not what I said.
I said that the public order emergency is assigned meaning by the CSIS Act, but is not restricted by the CSIS Act.
Right.
And so a public order emergency is broader than as defined by the CSIS Act.
So does a Section 2 CSIS Act threat to the security of Canada have to exist in order for a public order emergency to exist under the Emergencies Act?
We've seen the answer to that, in my opinion, is no.
Okay.
Well, I guess I'd like to walk you through the Emergencies Act and maybe see if I can persuade you that the answer is not no.
Well, as I said, you're going to receive legal arguments and I'm not going to respond to you in terms of the legal view.
You're a lawyer.
I am not.
And our lawyers will be making arguments.
Fair enough.
But I just want to show you the section of the act.
I understand.
I've read the section.
And we'll see where we get it.
I've read the section.
Okay.
But you don't mind my showing to you, I imagine.
All right.
Mr. Clerk, can we pull up the Emergencies Act?
It's CCF.
047.
When did you first read the Emergencies Act?
The Emergencies Act?
When I arrived in PCO.
Which would be when?
In January.
Okay.
And when did you first read the CSIS Act?
I haven't...
Five, ten years ago?
Yeah.
Okay.
Can you take us to the section of the Emergencies Act that defines a public order emergency?
Um I think it's further down.
Section 16. There it is.
There we go.
So, if we look at the definition of public order emergency, can you read that to us, that paragraph that starts with public order emergency in bold?
You'd like me to read it.
Yes, please.
Public order emergency means an emergency that arises from threats to the security of Canada and that is so serious as to be a national emergency.
And the next paragraph?
As the meaning assigned by Section 2 of the Canadian Security Intelligence Service Act.
Right.
So on a plain reading, not a legal interpretation, but on a plain reading, doesn't that say to you that the circumstances that constitute the emergency have to arise from a Section 2 threat to the security of Canada?
The witness has already said she's not going to interpret the act.
She's not a lawyer.
I mean, it's a fairly plain English reading, but I suppose...
As a lawyer, if that's all it required, you'd know we'd be out of business.
Fair enough.
All right.
You have one minute left, and so I'm just warning you that time's running out.
Okay, fair enough.
I guess what beyond that definition would you say is a threat to the security of Canada?
There's a range of threats that need to be considered when you're talking about this country.
Economic security.
The threat of IMVE.
The rhetoric of threats against public figures, the inability to conduct a livelihood in the City of Ottawa, as an example, at the Coutts border blockade, if we're going to speak about this specific example, the threat to public institutions and the undermining of the confidence in public institutions, those things all constitute a threat.
Right, but those aren't mentioned in Section 2 of the Thesis Act.
You asked me what did, and I answered your question, and the lawyers will talk about this.
Okay, but those aren't mentioned in Section 2 of the CSIS Act.
All right, fair enough.
Okay, well, thank you very much.
Those are my questions.
Okay, next, the Windsor Police Service.
I'm McCray, and I appear for the Windsor Police Service.
Mr. Clerk, could you please turn up the witness statement 6071 WTS?
Yes.
Thank you.
Sorry, if you could go down to the top of page 8, please.
Now, Ms. Thomas, is it correct, and I'm just, well, the Clerk does that, that you have been in the Federal Public Service for the last 20 years at least?
At least.
Okay, thank you.
At the top of this paragraph, it says, NSIA Thomas reflected, and then it goes on, it could have been better, the sharing of information, for instance.
Then ASC McDonald added that the implicated law enforcement agencies, OPS, SQ, OPP, WPS, and RCMP, maintain distinct intelligence silos.
Is that a view that you hold, Ms. Thomas?
It is.
It's improved since this convoy, but at the time, yes.
Your earlier evidence today, as I noted it, was that you were aware of Operation Hendon.
Isn't that correct?
I was made aware of Operation Hendon after the convoy.
I found out that ITAC and other elements of the federal national security community did see some of their reports, but I didn't.
Not directly.
Are you aware that, in fact, the Hendon reports to Project Hendon was a sharing of information, at least amongst OPS, WPS, and the OPP?
I am now, yes.
Okay.
So they're not truly distinct intelligence silos, isn't that correct?
It depends on where they're shared and how they're used.
Okay, thank you, Mr. Commissioner.
That's all my questions.
I would like to throw the balance of my time, if possible, to the City of Windsor, please.
That's a new arrangement, so I will take it under advisement.
City of Windsor Hopefully Hopefully we can have those extra two or three minutes.
Good evening.
My name is Jennifer King.
I'm legal counsel to the City of Windsor.
I would like to start with the issue of the line between a lawful and unlawful protest.
If Mr. Clerk could please bring up WIN 5-0's 5-11.
This is the February 11th injunction order granted in Windsor.
You were aware of this order at the time?
I was.
Okay, if you could please scroll to the bottom of page 2, paragraph 4. And here the court ordered that the defendants and any persons having notice of this order are hereby restrained and enjoined from impeding or blocking access to the Ambassador Bridge and indirect or direct approaching roadways and access points for 10 days from the date of this order.
You'll agree with me that this order was made effective February 11th at 7pm, Ms. Thomas.
So when the order became effective, any person having notice of this order who continued to impede or block access to the bridge would contravene the order, right?
Yes.
And disobeying a court order, you're aware that that is contrary to the Criminal Code section 127?
I wasn't aware of the section, but yes.
Okay.
And you're aware that protesters continued to impede and block access to the bridge after 7 p.m. on February 11th?
Yes.
Does this inform your assessment of whether the Ambassador Bridge blockade was a lawful protest, at least after this order became effective?
Well, it would have been an unlawful protest.
Okay.
Mr. Clerk, could you please bring up PB CAN 401661?
I understand from your witness summary that you spoke with the U.S. Homeland Security Advisor on February 9th and 10th.
I did.
Is that right?
Yes.
So this is an email from Martin Loken.
Who's Martin Loken?
Martin Loken at that time was a deputy to the ambassador in Washington.
To our ambassador.
Thank you.
So it appears that Mr. Loken sent this email to you before one of these calls with the U.S. Homeland Security Advisor.
Do you recall this email?
I do now.
I don't recall it from the time.
I've seen it.
And you'll see partway through the page, he suggests some additional messaging.
And I'll just take you to the third bullet.
And he says, critical that CBSA and CBP work together with relevant police of jurisdiction to ensure a traffic.
To ensure traffic keeps moving.
Do you agree with that message and convey that message to the U.S. Homeland Security Advisor at the time?
Yes.
Okay.
And then continuing on that bullet, recognize that international crossings are national security issue.
Do you understand what Mr. Loken meant here?
Yes, I do.
That the economic viability of the country is a national security issue and it's considered that on both sides of the border.
And you agree with that assessment?
I do.
Is that something you conveyed to the U.S. Homeland Security Advisor at the time?
It wasn't.
I did not need to convey it.
She raised it.
Okay.
And you both agreed that it was a national security issue?
Yes.
Thank you.
I'm showing you a lot of documents, and hopefully I'll get through it quickly.
So if you could please pull up SSM CAN.
I'm not sure if I've got this right.
It's 402694, Mr. Clerk.
What I want to show you is that the next day on February 11th, you participated in an opposition leader's briefing.
Do you recall that?
I do.
Okay.
So that's not it.
Oh, no, there it is.
Yes, it is.
Thank you, Mr. Clerk.
So if you could just go to page two in the middle of the page, you gave an update on the Ambassador Bridge blockade.
You recall that?
Yes.
A little bit farther down, Mr. Clerk.
You'll see...
It says ON there.
Okay.
So you state there, all three levels working together on this.
Are you referring to three levels of government there?
Yes.
This is somebody's notes of what I said, rather than verbatim transcript, but yes.
But that's what you said, that all three levels of government were working together on the issue of the Ambassador Bridge?
Yes.
Okay.
And if you continue on in that paragraph, working with U.S. federal, state.
Municipal communication is good.
So it's your understanding that the federal government was getting the information that it required from Windsor?
We were getting some information from Windsor.
We were getting some information from the United States.
And then the policing information you would have to speak to Commissioner Lackey about.
But in terms of working collectively with the two border agencies.
On both sides of the border, along with Homeland Security and the White House, people were working well, they had the same goal, and it was opening that bridge as quickly as possible.
Okay, and Mr. Clerk, if you could scroll down to just under the redactions on that page.
So at the bottom of the page.
So you're referring to questions about jurisdiction being constant here.
But this was not a question or concern or an issue at the operational level, at least in Windsor.
Are you aware, would you agree that any questions about jurisdictional issues did not impact the operational response of the police and local authorities on the ground in Windsor?
I agree with that.
But there were issues, jurisdictional issues, that CBSA was bringing to our attention.
The city versus who is accountable for the port of entry and I think that Mr. Ozoski spoke about that yesterday as did Mr. Keenan.
As far as you're aware there was no delay or operational issues with the response due to these questions that arose?
I can't say that unequivocally no.
Okay.
I think this will probably be my final question.
So, in your witness summary, you state that the primary goal of the decision to invoke the Act was to provide local and provincial police forces with additional policing authorities that would allow them to manage copycat protests and blockades in their jurisdictions.
Are you aware of any consultation with the local police forces and municipalities with respect to the authorities required to manage the protests and blockades in their jurisdictions?
I'm not aware, but I was not a part of the consultation outside the federal government.
Would you agree with me that it would have been useful to consult with the police, including police of jurisdiction and local authorities, to get information about what would be useful on the ground?
Yes, I would agree.
Thank you.
Those are my questions.
And thank you for the indulgence, Commissioner.
Okay, thank you.
Next is the National Police Federation.
Hello, Lauren Pierce for the National Police Federation.
Our questions have been canvassed by the previous parties.
We have no further questions.
Thank you.
Thank you.
The government of Saskatchewan.
Thank you.
Good evening, Ms. Thomas.
My name is Mike Morris and I'm Counsel for the Government of Saskatchewan.
Ms. Thomas, I understand that you were only about two weeks into your role as NSIA when the Freedom Convoy rolled into Ottawa.
Is that correct?
That is correct.
That meant you were effectively having to learn your role while in the thick of it.
Is that fair?
That's fair.
And I think you've stated that as an SIA, you are essentially a consumer of intelligence provided to you by other agencies such as the RCMP and CSIS, correct?
Amongst others, yes.
Right.
What I want to touch upon is your request for a threat assessment from the RCMP on February 14th.
Commission Council raised this with you.
And drew your attention to an email which was titled Urgent from Mike McDonald to the RCMP indicating you needed a threat assessment for the Clerk of the Privy Council.
Do you recall that?
I do.
So, I'm just going to ask the Registrar to pull up PB NSC CAN 403462.
The reason I'm pulling this up, ma 'am, is because I think you actually did get a response to that threat assessment, and I just want to give you the opportunity to see that.
Yeah, I remember the document.
It was incomplete and certainly not.
It was going to be incorporated into a broader document that was attached to the invocation material.
And so this is a part of a response.
Okay, because if we just scroll down, we can see there's information provided by Adriana Poloz from the RCMP to Mike McDonald at 2.25pm, correct?
Yes.
And she says, Mike has requested, please let me know if this suits your requirements.
And below that, of course, is obviously what is the RCMP assessment on the convoy.
I'd just like us to scroll up then again, back to the top.
Because it appears that you had some questions about this material, this assessment, and you had asked Mr. McDonald to convey them to the RCMP.
Particularly, it looks like he's quoted from something you typed, which begins, I guess my question is, how do we know, in particular, how do we know that the majority are peaceful?
And of course, there's some others.
Stuff typed after that as well, correct?
Correct.
Okay, so that was a question that you wanted answered, and Mr. McDonald seems to be indicating that NSIA would like the question answered within the next 20 minutes.
And if we just scroll up again so we can see the time of this email, it's 1952.
If we subtract five hours, I think that puts us at 2:52 p.m. on February 14th.
Is that fair?
That's fair.
Okay.
Do you know what time the first minister's meeting was held on that day?
I think it was 10:15 a.m.
I'll agree with you on that.
I don't know offhand.
And did it go for around an hour or a little over an hour, do you know?
I don't recall.
Okay.
And I gather you do know that the Prime Minister had a press conference scheduled for February 14th for 4.30pm.
Do you recall that?
I do.
And at that press conference, of course, the Prime Minister announced that the Emergencies Act was being invoked, correct?
Correct.
Okay.
I'm just trying to get a timeline.
So basically, you were looking for some more information at approximately 2.52 p.m.
You wanted it within the next 20 minutes, and there was a press conference scheduled that day for 4.30 p.m., correct?
Correct.
I was asking questions to be more expansive, to ensure that we answered a broad range of questions.
And this was required for the Clerk of the Privy Council, correct?
Correct.
Okay.
You wouldn't have asked if you didn't think the Clerk should have it, I assume, correct?
No, but as you would know, in government we do a lot of preparatory staff work to answer eventualities.
So I did not know at this point what the outcome was going to be of the Prime Minister's decisions.
We were preparing for every eventuality.
Okay.
You hadn't spoken with the Prime Minister between the first Minister's meeting and the announcement then at 4.30pm?
Or sorry, I shouldn't go to the announcement.
I should go to the time this email was sent.
I had not.
There were other parts of PCO who were more engaged at that point because there was a different work that needed to be done.
The Intergovernmental Affairs Group, as an example, rather than me.
I understand that.
I just have one last question.
There was reference to an email drafted by a person named Philippe LaFortune in the Privy Council office.
Do you recall that?
I do.
Is that person a lawyer?
Do you know?
He is not.
Not that I'm aware of.
Okay.
He was just essentially doing some legal research type work then.
Is that fair?
Yeah.
He was doing research.
I wouldn't call it legal.
Okay.
Thank you, ma 'am.
Those are my questions for you.
Have a good evening.
Thank you.
Okay.
Thank you.
Next is the Ontario Provincial Police.
Thank you, Commissioner.
Hello, Ms. Thomas.
My name is Jananne Kabursi and I'm one of the lawyers representing the Ontario Provincial Police in this hearing.
I'd like to start by talking to you a bit about your role and the role of your office and then some of the relationships and interactions that you have.
With the security and intelligence partners, as you've called them.
So as stated, I believe in your witness summary, and it's also in the institutional report for the Privy Council office, you'd agree that you work closely with your security and intelligence partners, and that includes CSIS, the RCMP, the PPS, as well as CBSA and Transport Canada.
That's sort of a foundational part of the work that you do.
I would say the PPS is not in that core group.
Okay, fair enough.
It's listed in the report.
Mike McDonald deals with them more than I do.
Right, right.
Okay.
And you also, in your exchange with Council for the CCF, I believe, you talked about...
Always consulting with the lead intelligence agencies that you work with whenever you're in the process of advising the Prime Minister about a threat.
Do you recall saying that just a short while ago?
I do.
You know, obviously reflecting your respect for the expertise and the work that those agencies do, which is in their area of specialization.
Well, it's more than expertise and respect.
It's their legal authorities.
Right.
And mandates.
Yeah.
It's, of course, a very important part of the consideration.
And so, I expect that in your role as a consumer of intelligence, but not a producer of intelligence or investigations, as we've heard earlier today, That there's a regular communication that you're doing with these entities and agencies that have to provide the information that then becomes part of that information flow through
your office, through to the cabinet and the prime minister, and perhaps others as well.
Correct.
Right.
And I expect that in that working relationship that you have with these parts, Partner entities and agencies that there's always an opportunity for some conversation about what you need as the NSIA, what they can provide to you.
Is that a fair expectation?
Yes.
So considering some of what's been discussed earlier in terms of The scope of what your office is able to do, given, as was raised in the questioning with Council for Freedom Corps, that you don't have any legislative framework for your work.
I'd like to talk about the current situation and how you deal with addressing the needs of your role through the entities that exist.
So, first example, you've spoken about a concern that it seemed to me perhaps gave rise to this interest in doing more in the way of social media intelligence work.
You know, and I take it that, to some extent, the concern is related to potential threats to public figures, the Prime Minister.
Others in the cabinet, for example.
That's one area of concern, I take it.
Is that fair to say?
Yes.
And so my understanding is that currently, if there's a concern in that regard, that the RCMP has a National Security Criminal Investigations Office that would have responsibility for...
Conducting threat assessments or perhaps doing an investigation.
If you had a concern that you wanted to have a police agency look at, is that?
Yes.
Am I correct?
Yes.
In order to provide that day-to-day security for the Prime Minister, there's the Prime Minister's protective detail.
And for others, there is the RCMP protective services currently fulfilling that function.
Correct.
Is that correct?
And so when doing that job, it's an intrinsic part of their job to continually evaluate.
Yes, on case-by-case events.
And so what my concern is, is broader than that.
The RCMP may tell you, and I'm giving you a number, it's not necessarily the correct number, that there were five actionable threats against the Prime Minister last year.
And they investigated all of them.
We have a concern in the intelligence and the security community at the deputy minister level, and certainly within PCO, about the rhetoric that is online.
So five actionable threats that they investigate, and they may arrest somebody, or they may warn somebody, or do any of the things that police agencies do.
But in fact, there's 1,000, maybe 1,500 threats of various nature.
That are going to affect other things that the Prime Minister does, that says something about the discourse and the concern out there.
And so it is a nuanced thing to try to explain, but we have a responsibility to understand.
We have a responsibility to understand the country.
And not on a case-by-case basis, on the mood, the tone.
And some of that's intelligence, and some of it is other parts of the various arms of government.
But I think that we are a little blind on what is going on in society.
And we are, in terms of the Prime Minister's protection, as an example, we are seeing a change in the environment that he is in.
We're seeing an increased level of anger.
And it's more than just him.
It's other public officials as well.
And we have a responsibility to understand that.
Right.
I appreciate that.
And one option that is available now at this point to investigate that concern.
To take whatever steps might be necessary to address that concern would be to refer that to the RCMP.
The RCMP will look at actionable intelligence.
This is a different notion.
It's a different need.
And the RCMP, we can't send everything to the RCMP.
They have their core functions to execute.
So I think I'm going to want to think what you're talking about after...
Oh, okay.
It just froze for a moment.
I don't know if I froze for a moment, perhaps.
For a moment, but go ahead.
Go ahead.
Okay.
Yeah, sorry about that.
You have two minutes left.
Okay, okay.
So I'm going to move through this more quickly then and then get back to the point that you were making, Ms. Thomas, about really the big picture and your concern about the big picture, you know, in light of the current authorities that exist for offices.
So we heard earlier my friend counsel for the Windsor Police Service, he asked you whether you're aware of the Project Hendon.
That was initiated by the OPP.
And we know that through these proceedings, you've become aware of that project.
And, you know, as you can appreciate, and you spoke to this earlier, you know, it seems clear to me that you understand that there's certain information that is held by law enforcement entities with their authorities and their protections for information that you understand.
You're not able to get directly because you are essentially a civilian office of government, right?
We agree on that?
Yep.
So then would you also agree with me then, and perhaps we, you know, just to be direct, we're considering the role of the RCMP in this information chain if there's an issue with the kind of information that you're getting.
From what is an existing project that the OPP has initiated.
But then that's something you could perhaps have a conversation with the RCMP about.
Absolutely.
And so that's the range of optionality that we are looking at in terms of understanding what the gap is and how we're going to fill it.
We don't have a solution yet.
We know there's a gap.
What is the best, most effective, most efficient way of filling it where we can have a broad view rather than a narrow view?
Right.
And counsel for the Ottawa Police Service, he took you through some of, or with reference to some of the documents regarding the information that was available to government in those days leading up to the convoy.
So you recall reviewing that with him just a short while ago?
Yes.
You know, I do have a question for you.
Were you made aware?
You're going to have to make it your last because you're over time, so go ahead.
Pick your last question.
Okay, we'll make it the last question.
Just on this matter of strategic review, have you had an opportunity?
I'm going to refer to a document, OPP 1600.
If we could pull it up very quickly, Mr. Clerk, just so that Ms. Thomas can take a look at it.
And I don't expect you have seen this before because it is a Project Hendon report that was produced on January 13th.
You can see it's entitled Strategic Intelligence Overview.
So I'll put it to you.
Ms. Thomas, that this overview is an example of the kind of big picture strategic review of intelligence without reference to individuals talking about societal movements and how they manifest themselves.
So would you agree?
Seeing this on its face, you can perhaps take a look at it on another occasion, but this is the kind of work that you're looking forward to.
You know, assist you in what you're hoping to do in your office.
This would be the kind of information we would receive along with other information and do a broad assessment of.
Okay, given that I'm out of time, we'll have to end our exchange here.
Thank you very much for your time and have a good evening.
And thank you, Commissioner, for allowing me a few extra moments.
Okay, thank you.
Next is the Government of Canada, please.
Good evening, Ms. Thomas.
Good evening.
Donary Nygaard for the Government of Canada.
I want to start out by asking you about something one of my friends asked.
The Council for OPS put to you that the convoy participants in Ottawa wanted just one thing to be heard.
What was your understanding of what the convoy participants wanted?
They wanted all mandates removed.
And they were going to stay in Ottawa until they were removed.
And there was an element of the convoy that wanted the Prime Minister removed and a proxy government formed.
Thank you.
We haven't spent any time today, and I'd like to spend a little bit of time discussing your role coordinating the response of the federal government.
to the events that were occurring in Ottawa and across the country.
So can you describe to the commissioner what role you played there and what the federal government was doing in that regard?
Thank you.
So, as has been said in my interview summary and in our institutional report, PCO has that central coordinating function for the Government of Canada on a number of issues, on just about every issue that goes through to Cabinet.
We play a coordination function.
We have a challenge function.
And when there is a crisis, and this has been for as long as the position has existed, the NSIA on this kind of a crisis plays a lead role.
Much of the organization of...
Meetings and documentation and briefing to ministers was organized by Jackie Bogdan, who's the new Deputy Secretary for Emergency Management at PCO.
But what we did was bring colleagues together with their experts to discuss and try to understand how the federal government could assist in the resolution of not only the blockade here in Ottawa, but the various convoys that were occurring across the country.
Because we've talked a lot about Ottawa today, but we haven't talked as much about the Ambassador Bridge.
We certainly haven't talked about COOTS and then the continual pop-up convoys that were happening over this period in time.
We used the forum of DMOC, which you have heard that acronym, to bring together the lead agencies.
And we added additional...
Departments, for example, the Deputy Minister of Justice joined us for many of our discussions.
And because PCO was so very involved at every level in terms of the management of the national crises, I invited other Deputy Secretaries to come to DMOC, and certainly the Clerk and the Deputy Clerk had a standing invitation.
We wanted to have as broad a view as we could of what was going on and why it was happening and how the federal government could use existing authorities and resources to respond.
You've heard the discussion of the TOTAC strategy.
Well, that came out of discussions at DMOC.
The work that Deputy Minister Stewart was leading on engagement, that came...
To DMOC for original discussion before it went to cabinet, but that was where we brainstormed, aired ideas, and assigned tasks to various people and departments and PCO to follow up.
Most of the work was tasked from DMOC down into ADM and SOPs, and they went off and engaged because ADMs are that engine that do that level of work.
We briefed ministers almost daily, the core group of ministers.
We did have formal cabinet meetings, as you've seen, the Safety, Security, and Emergency Management Committee, Canada and the World.
We used Canada and the World because there was already a scheduled meeting to discuss Ukraine.
The right group of ministers were there, so we briefed this as well.
We had briefings to the prime minister.
And then the IRG was invoked.
And the full cabinet meetings leading up in between SSE, Canada and the World, and the IRG were also the vehicle to get information to the Prime Minister.
We tried to be very methodical in how we tracked what was on the table.
To review, to pursue, to engage with provincial and municipal colleagues on.
And that was the trackers that you've seen in the evidence developed out of there.
So I did not tell any deputy minister what they should do, nor what they should not do.
We'd agree on courses of action, what ministers were going to be briefed, how we were going to engage ministers.
In the plans to try and use federal authorities and work with provincial authorities to resolve individual situations.
But it is a coordination group where we talk, we discuss operational issues, and each department goes back and does their own thing and reports back in.
And it's a relatively effective use of time and energy.
And it became every day.
Going through department department.
Yesterday you said this.
What's changed?
What are you doing tomorrow?
Where are we?
And what were you telling the Deputy Minister community in those meetings about what their approach should be to looking at this issue?
Well, I would like to take credit, but it's the Clerk of the Privy Council that actually told the community that when you're in the security environment, you get used to crises and you get used to protests and you get used to...
Reading online threats, those kinds of things.
She wanted us to think differently and think more broadly.
And to understand this situation, although it was acknowledged by the security deputy ministers, was unique in terms of its expanse across the country.
That there was a thread across all of the incidents that said something and that we needed to look at it from.
That perspective, as well as the individual resolution of problems.
Yes, the tow truck strategy, as an example, was very, very important, but there is a bigger, broader role for the federal government, and we needed to look at that.
And this was happening in DMOC, and at the same time, there were the SSEs at the beginning of the process that were continuous.
What's the relationship between those two?
There isn't a relationship.
Other than most of the deputy ministers at DMOC, their ministers are members of the SSE committee.
And so there was a one-to-one briefing from the deputies to their ministers.
Ministers would go and prepare to SSE.
So the work that was being done by the deputy minister community through DMOC to try and find solutions to this problem, when did that stop?
DMOC?
It didn't stop.
And did, so I guess the point I'm getting at, on the 10th of February, when it moved from SSE to the IRG and the Track 1 and the Track 2 was put in place, what were the, what was the Deputy Minister community working on at that point?
So it just, the moving to the IRG brought a focus from the Prime Minister and it was very directive of What are you doing, Transport Canada?
Minister Al-Gabra, work with your provincial colleagues to achieve X, Y, and Z, and that became the tracker.
So track one was anything we could do under existing legislation and with existing tools, and track two became what new could you use to help resolve this?
So when you moved to the track one and track two, the deputy minister community was still working on...
The issues in Track 1, what could we do to resolve with the existing authorities?
Absolutely.
And that continued on from February 10th until revocation.
And you spoke to my friend for the City of Windsor about your discussion with Homeland Security in the United States.
Can you tell us a little bit more about that?
The Deputy Homeland Security, Deputy NSA for Homeland Security is Liz Sherwood-Randall.
She reached out to me to say, we have a concern about the Ambassador Bridge.
You've heard that concern from others.
She said nothing different than what has already been heard.
The President had been hearing from auto companies.
He'd been hearing from governors.
What was the situation?
What could I tell her?
And how could they help?
So, fair to say that they were expressing considerable concern about the situation?
Absolutely concerned, but no pressure.
They'd experienced their own protests.
They knew they were complex.
Could we learn from their experiences, and could we keep them informed as we were working through this, and if they could help in any way, they would.
So when we get to the period of February 13th and 14th, and you've talked about your role in coordinating the information that's coming from the various intelligence communities within the federal government and pulling that all together to provide advice to the Prime Minister.
In the period February 13th and 14th, what was your assessment of the situation that was going on across Canada at that point?
My assessment was that this was an entrenched movement.
That the convoys were feeding off of each other.
That they were causing significant economic instability.
That the violent rhetoric was increasing rapidly.
Exponentially.
That the number of threats against public figures were increasing.
That we were seeing, I don't know if I've said this, seeing increased IMVE rhetoric that was concerning.
Our concern on that front is not that any of the organizers of these various groups were going to take action themselves, but they were going to inspire a lone wolf.
And our experience in Canada is that of the...
Injuries and deaths that have been caused by ideologically motivated individuals, none of them have been known.
They've all been inspired by online movements and rhetoric to do something and to act, and we had profound concern about that.
Coutts was a point in time of huge concern because we'd been told there were weapons found in Coutts.
I can't say that anybody was surprised there were weapons.
We expected weapons to show up in various locations or anticipated that they could, but that it was of the magnitude that it was, was a significant concern.
And the same language was being used in Ottawa.
OPS said there were weapons in some of those rigs.
Well, what did that mean?
One person had a gun or that there was another group similar to Coutts?
What we didn't know was as significant as what we did know.
And we were at the point where we were going into the fourth weekend because we were through the third weekend without resolution.
And in fact, it was growing.
Ambassador Bridge, yes, moving towards being resolved, but until every single day that new convoys were being formed to take back the bridge, or they were going to take the Peace Bridge, or they were going to do both.
There were convoys coming from across the country to reinforce Ottawa.
If that had become violent, and of course we're working on inabsolute information and nothing is, there is no intelligence that says tomorrow there's going to be an attack.
But if it had become violent, knowing what we know now, there was not the police on the ground to manage it.
And so you have to work in a world where...
You don't have absolutes and you have to use your best judgment on what to do.
And what had to happen was it had to end.
And you've made clear, I think, in your earlier testimony that your view that the Section 2 CSIS Act definition, as applied by CSIS in the context of their particular mandate to investigate and collect information on, Individuals or groups is very narrow.
My understanding, yes, your position.
And am I understanding what you said correctly in answer to my friend from JCCF's question about this in relation to these events, that your view is that it didn't meet the Section 2 CSIS Act definition as CSIS would apply it?
That's correct.
You were asked by the Commission Council about whether your views were asked at the February 13th IRG regarding whether the Emergency Act should be invoked, and you said that you had indicated yes at that time.
Can you tell us why?
For the reasons I described earlier, If the powers existed in legislation, they were not being used or couldn't be used, and that we needed to take swift and decisive action to bring this national crisis to an end.
We needed to compel tow trucks.
We needed to have an exclusion zone so that people could no longer join the convoy.
And the funding and the logistics chain that supported, particularly in Ottawa, but in other locations as well, the funding was significant, and so we needed to understand the money.
And I know that Deputy Minister Sabia explained that earlier today.
The combination of the tools that were put into the Emergency Act...
Time-limited, as restrictive as possible, and as transparent as possible, was determined to be, by the Governor and Council, the most appropriate action to take at that moment in time to end what was going on across the country.
And finally, can you tell us a little bit about how mis- and disinformation in the context of the convoy So, misinformation is a very hot topic.
And everybody presumes that the misinformation has to come from foreign sources and be foreign interference.
And so, there was a question that was discussed at one point about whether, you know, Russia was fomenting the disinformation.
The misinformation...
Mis and disinformation, it could be said, is at the root of some of this problem of the convoy and the anger about vaccines and mandates and masks.
The problem with it is that it occurs in the social media space.
And threads pick up on each other and they generate more.
And so if you believe misinformation, that's all you're going to see because you search for it and the algorithms feed it to you.
We're actually working with social media companies to understand how the algorithms feed misinformation and more significant terrorist information.
That's come out of what happened in Christchurch and it's quite well known, the Christchurch call.
Misinformation means that people...
And disinformation have one source of information, and it continuously feeds upon each other.
We heard misinformation during this hearing when somebody mentioned that they were not going to put DNA-altering medication in them.
There is no DNA-altering medication, but it's believed.
And so it made it very difficult to try and build a fact base for...
Health officials, for police officials.
There was misinformation during the convoy, for example, that the Prime Minister had signed a letter.
He had not, but it circulated through the convoy here in Ottawa, like wildfire.
Absolutely incorrect, but it became fact for people, and it becomes fact very easily, and that sows some of the seeds of discontent that we have seen.
Thank you.
Those are all my questions.
Thank you.
Any reply?
No?
Okay.
For the record, there is none.
Okay, well, we want to thank you for coming and giving your evidence.
You're free to go and enjoy what's left of the evening.
Thank you, sir.
And thank you for your evidence.
So we're going to adjourn until tomorrow morning at 9.30.
I expect it will be another long day.
But it's Friday, so we can look forward to a weekend, some of us.
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