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2017 donations show Ontario political finance system still undemocratic – Liberals and PCs both received 36% of donations from only 11% of donors

NDP received 14% of donations from only 2% of their donors, and Greens received 18% of donations from only 4% of their donors

Elections Ontario should conduct audit — would likely find high donation limit has led to funneling and bundling of donations (as happened in Quebec and at the federal level)

To stop the unethical influence of big money in Ontario politics, 50-group coalition, and more than 10,000 Ontario voters, call for annual donation and loan limit for individuals (including candidates) of $100 (as in Quebec), stronger enforcement and penalties for violations, and review of annual per-vote and donation-matching public funding to prove it’s actually needed

Same changes should be made to municipal political finance system across Ontario

FOR IMMEDIATE RELEASE:
Thursday, January 11, 2018

OTTAWA – Today, just as it predicted in 2016, Democracy Watch revealed that Ontario’s provincial political finance system is still undemocratic as initial 2017 donations data from Elections Ontario show the Liberals and PCs received a large share of their donations from a very small group of people who donated $1,000 or more.

The Ontario Liberals received 36.5% of total donations in 2017 from only 11.8% of their donors who donated $1,000 or more.  The PCs received 35.7% of total donations from only 11% of their donors. The NDP received 14% of donations from only 2% of their donors, and the Greens received 18% of donations from only 4% of their donors. (See details further below)

As well, people who donated $500-$999 contributed a significant portion of the total money raised by the parties.  Overall, the Liberals received 60% of their total donations from 26% of their donors who donated $500 or more; the PCs received 56% from 23% of their donors who donated $500 or more; the NDP received 33% from 7.5% of their donors who donated $500 or more, and; the Greens received 42% from 18% of their donors who donated $500 or more.

“As Democracy Watch predicted last year, Ontario’s new donation limit is much higher than the average voter can afford and the parties are relying on wealthy donors for a lot of the money they raise, which gives those wealthy donors unethical influence over the parties,” said Duff Conacher, Co-founder of Democracy Watch and Chairperson of the Money in Politics Coalition.  “Ontario’s too-high donation limit is also likely encouraging funneling of donations from businesses through their executives and employees and their families, and bundling of donations by lobbyists, both of which happened in Quebec and at the federal level, and Elections Ontario must conduct an audit to ensure these things are not happening.”

Based on the donation patterns in 2017, Democracy Watch and the Money in Politics Coalition (made up of 50 groups with a total of more than 3 million members), joined by almost 10,000 Ontario voters who have signed a petition on Change.org, called on Ontario’s political parties to make the following changes to get big money out of Ontario politics before the legislature breaks for the upcoming provincial election:

  1. set an individual donation limit of $100 per year (as in Quebec);
  2. set a limit of what candidates can give to their own campaign of $100 per year;
  3. prohibit loans to parties except from a public fund;
  4. review the per-vote annual public funding and, if the parties can actually prove they need it, set it at at most $1 per vote, and use annual donation-matching public funding if parties prove it is needed, and;
  5. strengthen enforcement and penalties for violations.

Democracy Watch also called on Elections Ontario to conduct an audit to ensure that businesses were not funneling donations through their executives and family members (as happened in Quebec and at the federal level), and to ensure that lobbyists are not holding fundraising events to be “bundlers” of donations as a way of having undue influence over parties or politicians.

Years of experience and scandals in Quebec before 2013, at the federal level since 2007, and in Toronto since 2009, and also in Alberta, show clearly that setting a donation limit that allows individuals to donate more than $1,000 each year will allow the unethical influence of big money donations, and cash-for-access fundraising schemes, to continue in Ontario.

“As Quebec, federal and Alberta donation scandals show clearly, the only way to stop the unethical, undemocratic influence of money in B.C. politics is to stop big money donations by allowing only individuals to donate only $100 a year,” said Conacher.

See details about past donation scandals, and the key changes needed to stop big money in Ontario politics, in this news release.

The donation data for the four main parties, and donations of $1,000 or more, is as follows:

Ontario Liberal Party:
Total Donated in 2017 – $1,106,657.96
Total Number of Donors in 2017 – 2,787
Total Donated in amounts of $1,000 or more – $403,532.45 (36.46% of total donated)
Total Number of Donors donating $1,000 or more – 329 (11.80% of total donors)

PC Party of Ontario:
Total Donated in 2017 – $2,353,406.70
Total Number of Donors in 2017 – 6,541
Total Donated in amounts of $1,000 or more – $839,626 (35.67% of total donated)
Total Number of Donors donating $1,000 or more – 722 (11.03% of total donors)

Ontario NDP:
Total Donated in 2017 – $1,155,909.91
Total Number of Donors in 2017 – 6,508
Total Donated in amounts of $1,000 or more – $163,426.50 (14.14% of total donated)
Total Number of Donors donating $1,000 or more – 148 (2.3% of total donors)

Green Party of Ontario:
Total Donated in 2017 – $379,308.40
Total Number of Donors in 2017 – 1,458
Total Donated in amounts of $1,000 or more – $68,545.50 (18.07% of total donated)
Total Number of Donors donating $1,000 or more – 58 (3.98% of total donors)

The donation data for the four main parties for donations of $500-$999 is as follows:

Ontario Liberal Party:
Total Donated in amounts of $500-$999 – $255,932.31 (23.12% of total donated)
Total Number of Donors donating $500-$999 – 392 (14.06% of total donors)

PC Party of Ontario:
Total Donated in amounts of $500-$999 – $508,152.06 (21.59% of total donated)
Total Number of Donors donating $500-$999 – 817 (12.49% of total donors)

Ontario NDP:
Total Donated in amounts of $500-$999 – $218,512.59 (18.90% of total donated)
Total Number of Donors donating $500-$999 – 338 (5.19% of total donors)

Green Party of Ontario:
Total Donated in amounts of $500-$999 – $91,734.65 (24.18% of total donated)
Total Number of Donors donating $500-$999 – 203 (13.92% of total donors)

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FOR MORE INFORMATION, CONTACT:
Duff Conacher, Co-founder of Democracy Watch and Chairperson of the Money in Politics Coalition
Tel: (613) 241-5179
Cell: 416-546-3443
info@democracywatch.ca

Democracy Watch’s Money in Politics Campaign

Democracy Watch calls on Elections Ontario to inform voters of all their rights effectively, including right to decline their ballot in 2018 election – plans court challenge

Elections Ontario spent $4.83 million during 2014 election campaign on voter information and ads that all missed key messages to encourage voter turnout – turnout was second lowest level ever at 51.3%

(NOTE: Since Democracy Watch sent its letter yesterday to Elections Ontario, it has thankfully added information about the right to decline your ballot to the “Voting” page, “Glossary” page, and “How to Vote” page of its website. See a screenshot here of the “How to Vote” page as it was two days ago to compare it with the page linked in the previous sentence, and you will see that it has been updated to add a section entitled “Different ways to mark your ballot” that mentions the right to decline your ballot. However, there are still more than a dozen documents about voting and voter rights on Elections Ontario’s website that fail to mention the right to decline your ballot)

FOR IMMEDIATE RELEASE:
Tuesday, January 9, 2018

OTTAWA –  Today, Democracy Watch released the letter it sent yesterday to Ontario’s Chief Electoral Officer Greg Essensa calling on him to, in contrast to the 2011 and 2014 provincial election, spend the likely more than $4.5 million in advertising and communications with voters about the 2018 election effectively by producing new advertising that gives voters actual reasons to vote, and informs them that they have the right to decline their ballot (in other words, to vote “none of the above”).

Despite Elections Ontario’s $4.5 million in advertising spending in 2011, voter turnout in the 2011 Ontario election was a record low 48.2% of eligible voters, the first time in history that turnout dropped below 50%.  And despite Elections Ontario’s more than $4.8 million in ad spending in 2014, turnout in the 2014 election was the second-lowest ever at 51.3%.  The 2007 turnout was only slightly better at 52.1%.

In the letter, Democracy Watch requests that Elections Ontario make changes to its website, election advertising, information package for new voters, voter information cards, and teacher and youth education documents so that they all include clear information that ensures Ontario voters know they have the legal right under section 53 of Ontario’s Election Act to decline their ballot (i.e. vote “none of the above”) and have it counted separately from a vote for a candidate or a spoiled ballot.  This right has existed in the law since 1975.

As the letter details, Elections Ontario currently mentions the right to decline your ballot briefly only once on its website, in only one of more than a dozen documents about voting, totaling more than 200 pages, that can be downloaded from the site.  Also detailed in the letter is how, in its 2011 and 2014 election advertising, website pages, new voter information package, voter information card, Elections Ontario failed to mention the right to decline your ballot.

If Elections Ontario fails to fulfill its legal duties properly to educate voters about all their voting rights (as set out in in subsection 114.1(2) and section 114.2 of the Election Act), Democracy Watch will apply to court for an order mandating Elections Ontario to make the changes to its website, ads and information documents.

Democracy Watch sent a similar letter to Mr. Essensa in 2011 (after it was consulted by Elections Ontario concerning voter education), and again in 2014, but he has failed to make changes to include information about the right to decline your ballot on Elections Ontario’s website, and in its ads and public education documents, for the past seven years.

“Elections Ontario claims to uphold the democratic rights of voters but continues to fail to inform voters with its website, advertising and voter information that they have the legal right to vote none of the above by declining their ballot,” said Duff Conacher, Co-founder of Democracy Watch.  “Democracy Watch is calling on Elections Ontario to correct its website, advertising and voter information, and if it fails to do so will challenge in court Elections Ontario’s negligent and undemocratic failure to inform voters of their full voting rights.”

“Some voters may not support any party that has a candidate in their riding or may not support any of the parties’ platforms, and they have the right to be informed by Elections Ontario that they have the right to vote for ‘none of the above’ by declining their ballot,” said Conacher.

In its letter, Democracy Watch also urges Elections Ontario, if it hopes to encourage higher voter turnout with its election advertising, to include the following key messages on its website, and in its ads and any information sent to voters (including the voter registration card):

  • “You never know when your vote may count” — with examples from past provincial elections such as 1985 and 1990, and from specific ridings in various elections, all  of which show clearly that local and provincial election results cannot be predicted in advance, and;
  • “If you don’t vote, you don’t count” — making it clear that politicians don’t really care about you if you don’t vote because non-voters do not help them get elected, or defeated.

The federal government, and every provincial and territorial government, should add the right to vote “none of the above” and to give a reason to their election laws (including the election laws for municipal elections in each jurisdiction).

In addition, the Ontario parties must make the following changes if they want to increase voter turnout up to the past average levels of 65-70% that occurred from the 1934 provincial election through to the 2003 election:

  • pass an honesty-in-politics law that gives voters an easy, low-cost way to file complaints about broken promises and false statements to the Integrity Commissioner, and gives the Commissioner the power to penalize misleaders (and requires MPPs who switch parties in-between elections for unjustifiable reasons to resign and run in a by-election);
  • change the voting system to provide a more accurate representation of the popular vote results in each election in the seats held by each party in the legislature (as in many other countries) while ensuring that all elected officials are supported by, and are accountable to, voters in each riding/constituency (with a safeguard to ensure that a party with a low-level, narrow-base of support does not have a disproportionately high level of power in the legislature), and;
  • strengthen provincial political ethics, political finance, lobbying, open government, and whistleblower protection laws.

These changes would give voters many more reasons to vote because they would know that voting for a specific party would mean their vote would count and the party’s promises would be kept, and they would be more assured of democratic good government overall no matter which party won.

“More and more voters know from their experience of the past few decades of elections that they are not going to get what they vote for, and are likely to get dishonest, secretive, unethical, unrepresentative and wasteful government no matter who they vote for, and as a result no one should be surprised to see voter turnout in Ontario at such a low level,” said Conacher.

These problems exist in all the provinces and territories across Canada.  All of these changes should be made by the federal and provincial and territorial governments, and for their municipalities, before mandatory voting is even considered because forcing voters to vote creates false legitimacy for political parties and politicians (and mandatory voting must never be implemented unless “none of the above” is one of the options on the ballot).  As well, Internet voting should not even be considered currently because it dangerously undermines the integrity of the voting system.

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FOR MORE INFORMATION, CONTACT:
Duff Conacher, Co-founder of Democracy Watch
Tel: 613-241-5179
Cell: 416-546-3443

Democracy Watch’s Democratic Voting System Campaign

Lobbying Commissioner confirms investigation of Democracy Watch’s complaint that Aga Khan violated Lobbyists’ Code by giving PM Trudeau and MP O’Regan gift of trip to Bahamas island

New Lobbying Commissioner Nancy Bélanger in conflict of interest as she was handpicked by Trudeau through secretive, PMO-controlled process – must refer investigation to person independent of her and all parties or DWatch will go to court

Auditor General should also audit past Lobbying Commissioner Karen Shepherd’s and Ethics Commissioner Mary Dawson’s extremely weak enforcement records

Review of federal ethics and lobbying laws next year must close loopholes, strengthen enforcement, make Ethics Commissioner and Lobbying Commissioner independent, and add high fines as penalties

FOR IMMEDIATE RELEASE:
Monday, January 8, 2018

OTTAWA – Today, Democracy Watch released the December 28th letter it received from the Lobbying Commissioner confirming that the Commissioner’s office is investigating its complaint filed on December 20th concerning whether the Aga Khan’s gift of the Bahamas trip given to Prime Minister Trudeau in December 2014 and December 2016, and to Liberal MP Seamus O’Regan in December 2016, violated the Lobbyists’ Code of Conduct.

The Lobbying Commissioner calls the initial investigation stage an “administrative review” but, in fact, it is an investigation that leads to an investigator giving an investigation report to the Lobbying Commissioner who then makes a ruling on whether a full investigation is warranted.

“An independent investigation about whether the Aga Khan a year ago violated the lobbyist ethics code by giving the trip gift to PM Trudeau and MP O’Regan should have been initiated a year ago,” said Duff Conacher, Co-founder of Democracy Watch.  “Given that she was handpicked by Trudeau through a secretive, PMO-controlled process, the Lobbying Commissioner is in a conflict of interest and so must delegate the investigation to a person who is independent of her and all federal political parties.”

Democracy Watch will soon file a court case challenging the appointments of new Ethics Commissioner Mario Dion and new Lobbying Commissioner Nancy Bélanger as both commissioners’ offices were investigating situations involving Trudeau and other Cabinet ministers or Liberal MPs when they were chosen through secretive, PMO- and Cabinet-controlled selection processes.  In the meantime, it is requesting that both commissioners recuse themselves from all investigations and rulings given they both have a reasonable apprehension of bias in favour of the Liberals.

CBC reported on December 22nd that another person had complained to the Lobbying Commissioner about the Aga Khan’s trip gift to Trudeau sometime in the past year, and that former Lobbying Commissioner Karen Shepherd had issued a ruling last September that even though the Aga Khan is on the boards of both the Aga Khan Foundation and the Global Centre for Pluralism, both of which are registered to lobby the federal government, because he wasn’t paid to lobby for them the Lobbying Act and Lobbyists’ Code of Conduct do not apply to him.

Democracy Watch’s December 20th complaint is essentially asking for an independent re-consideration of Commissioner Shepherd’s ruling, given that she was in a conflict of interest at the time she issued the ruling as she was serving on a renewable six-month sole-source contract handed to her by the Trudeau Cabinet last June.  Democracy Watch will soon file a court case challenging Commissioner Shepherd’s ruling in court.

Democracy Watch also repeated its call on the Auditor General to audit Commissioner Dawson’s record over the past 10 years because she has let 95% of people alleged to have violated the rules off the hook, and made 218 secret rulings.  Commissioner Dawson finishes her term in office today.

Democracy Watch is also calling on the Auditor General to audit the Lobbying Commissioner and RCMP because they have let off the hook 84% of people who she has caught violating the Code or the Lobbying Act.  Commissioner Shepherd finished her term in office on December 29th.

Hundreds of Canadians have joined the call on the Auditor General to audit the Ethics Commissioner and Lobbying Commissioner and RCMP — see details here.

“Ethics Commissioner Dawson went out with a bang by finally finding Prime Minister Trudeau guilty of violating the ethics law but her overall record since 2007 is as a lapdog who has let almost everyone off and the Auditor General should audit to find out if she covered up any past wrongdoing,” said Conacher.  “Lobbying Commissioner Shepherd went out with a whimper by issuing only one public ruling in the past two years since the Liberals were elected, and she also let almost everyone off since 2008 so the Auditor General should also audit her negligently weak record.”

Prime Minister Trudeau faces no penalty for violating the federal ethics law even though it is one of the key laws that safeguards Canada’s democracy.  The ethics rules for Cabinet ministers have existed back to when Trudeau’s father was Prime Minister but all prime ministers since have rejected the proposal to impose penalties for violations.

Other ongoing problems with the federal government ethics system are that Ethics Commissioner Dawson didn’t catch Prime Minister Trudeau violating the law by taking the trip gift because she has refused to do basic audits since 2007 to ensure everyone is complying with the law.  In addition, the law has huge loopholes that allow Cabinet ministers to profit from their decisions, as the scandal involving Finance Minister Morneau has revealed.

As well, the Trudeau Cabinet has just handpicked the new Ethics Commissioner Mario Dion and new Lobbying Commissioner Nancy Belanger through a secretive, PMO-controlled process that Democracy Watch will be challenging in court in January.  See details here.

The Conflict of Interest Act and the Lobbying Act are required to be reviewed by the House Ethics Committee in 2018.  The Conservatives rejected many key proposed changes when the laws were last reviewed by the Committee.  See details about the changes needed to close loopholes and strengthen enforcement of the Conflict of Interest Act here.

See details about the changes needed to close loopholes and strengthen enforcement and penalties for the Lobbying Act and Lobbyists’ Code of Conduct here.

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FOR MORE INFORMATION, CONTACT:
Duff Conacher, Co-founder of Democracy Watch
Tel: (613) 241-5179    Cell: 416-546-3443
info@democracywatch.ca

Democracy Watch’s Government Ethics Campaign page

Ethics Commissioner’s good ruling on Aga Khan gift to Prime Minister doesn’t excuse overall very weak record that Auditor General should audit

Democracy Watch calls on Lobbying Commissioner to find Aga Khan guilty of violating Lobbyists’ Code — Auditor General should also audit her weak record

Review of federal ethics and lobbying laws next year must close loopholes, strengthen enforcement, make Ethics Commissioner and Lobbying Commissioner independent, and add high fines as penalties

FOR IMMEDIATE RELEASE:
Wednesday, December 20, 2017

OTTAWA – Today, Democracy Watch applauded Ethics Commissioner Mary Dawson for doing the right thing, finally, by finding Prime Minister Trudeau guilty of violating the federal ethics law by accepting the gift of the Bahamas trip from the Aga Khan, and also taking part in decisions that affected the Aga Khan’s foundation.

However, Democracy Watch repeated its call on the Auditor General to audit Commissioner Dawson’s record over the past 10 years because she has let 95% of people alleged to have violated the rules off the hook, and made 218 secret rulings.  Commissioner Dawson finishes her term in office on January 8th.

Democracy Watch also sent a letter to Commissioner of Lobbying Karen Shepherd this afternoon calling for an investigation into the Aga Khan’s gift as a violation of the Lobbyists’ Code of Conduct.

Democracy Watch is also calling on the Auditor General to audit the Lobbying Commissioner and RCMP because they have let off the hook 84% of people who she has caught violating the Code or the Lobbying Act.  Commissioner Shepherd finishes her term in office on December 29th.

Hundreds of Canadians have joined the call on the Auditor General to audit the Ethics Commissioner and Lobbying Commissioner and RCMP — see details here.

“Ethics Commissioner Dawson is going out with a bang not a whimper by finally finding Prime Minister Trudeau guilty of violating the ethics law but her overall record since 2007 is as a lapdog who has let almost everyone off and the Auditor General should audit to find out if she covered up any past wrongdoing,” said Duff Conacher, Co-founder of Democracy Watch.  “Lobbying Commissioner Shepherd should have started investigating the Aga Khan a year ago for violating the lobbyist ethics code by giving the trip gift to Trudeau, and the Auditor General should also audit her negligently weak record.”

Prime Minister Trudeau faces no penalty for violating the federal ethics law even though it is one of the key laws that safeguards Canada’s democracy.  The ethics rules for Cabinet ministers have existed back to when Trudeau’s father was Prime Minister but all prime ministers since have rejected the proposal to impose penalties for violations.

Other ongoing problems with the federal government ethics system are that Ethics Commissioner Dawson didn’t catch Prime Minister Trudeau violating the law by taking the trip gift because she has refused to do basic audits since 2007 to ensure everyone is complying with the law.  In addition, the law has huge loopholes that allow Cabinet ministers to profit from their decisions, as the scandal involving Finance Minister Morneau has revealed.

As well, the Trudeau Cabinet has just handpicked the new Ethics Commissioner Mario Dion and new Lobbying Commissioner Nancy Belanger through a secretive, PMO-controlled process that Democracy Watch will be challenging in court in January.  See details here.

The Conflict of Interest Act and the Lobbying Act are required to be reviewed by the House Ethics Committee in 2018.  The Conservatives rejected many key proposed changes when the laws were last reviewed by the Committee.  See details about the changes needed to close loopholes and strengthen enforcement of the Conflict of Interest Act here.

See details about the changes needed to close loopholes and strengthen enforcement and penalties for the Lobbying Act and Lobbyists’ Code of Conduct here.

– 30 –

FOR MORE INFORMATION, CONTACT:
Duff Conacher, Co-founder of Democracy Watch
Tel: (613) 241-5179    Cell: 416-546-3443
info@democracywatch.ca

Democracy Watch’s Government Ethics Campaign page

Like Scrooge, Canada’s big businesses and banks trying to keep all the money for themselves

Paying only 22% of all income taxes, at near lowest rate of G7 countries, and loopholes legalize tax evasion

New national petition calls for Finance Minister Morneau to make key changes to make them pay their fair share of taxes

Key changes also needed to stop Big Bank gouging and abuse – Canada’s Big 6 Banks made a record profit of $42.3 billion in 2017

FOR IMMEDIATE RELEASE:
Monday, December 18, 2017

OTTAWA – Today, Democracy Watch launched its new national petition on Change.org calling for key changes to make Canada’s big businesses and Big Banks pay their fair share of taxes.

A special report recently published in the Toronto Star details how Canadian big businesses, especially the Big Banks, have higher profits but pay a lower rate of taxes than ever before.

“Like Scrooge, Canada’s big businesses and banks are trying to keep all the money for themselves, and key changes are needed to close loopholes and match the average tax rate in G7 countries to ensure they pay their fair share of taxes,” said Duff Conacher, Co-founder of Democracy Watch. “As well, Canada’s big banks have gouged their way to record profits again this year, and key changes are needed to stop the gouging and ensure they serve all customers fairly at fair prices.”

In 2016, big businesses paid only 22% of total taxes collected by governments — Canadians paid 78%. In contrast, in 1952 big businesses and Canadians paid the same amount in taxes.

As the report says: “Canada’s largest corporations use complex techniques and tax loopholes to reduce their taxes significantly below the official corporate tax rate set by the government.”

As well, the report details how cutting Canada’s corporate tax rate by 16% from 1997 to 2016 has not increased corporate investment in machinery and equipment and in intellectual property like it was supposed to do. Investments by Canada’s big businesses in these areas are still below the 1997 level as a percentage of GDP.

Canada’s official corporate tax rate is now 26.6% but, on average, Canadian big businesses paid only 17.7% from 2011-2016 — one of the lowest rates of all G7 countries.

Canada’s Big Banks paid a tax rate of only 16% over the past 6 years — lower than banks in other G7 countries. They are the biggest tax evaders of all Canadian big businesses and, not surprisingly, also the most profitable. They made a record $42.3 billion in profits in 2017.

If Canada’s big businesses and banks paid the official tax rate from 2011-2016, governments across Canada would have almost $64 billion more to spend on making hospitals, schools, housing, public transit and roads better, and on other things Canadians need.

Making Canada’s big businesses and banks pay their fair share in taxes will raise at least $10 billion each year, and billions more if the corporate tax rate is increased to the average rate in G7 countries.

The petition calls on Liberal Finance Minister Morneau to work with federal political parties to work together to make the following three key changes:

  1. Close all the loopholes that allow Canada’s big businesses and banks to evade paying taxes in Canada by pretending they make their money through companies they own in low-tax countries;
  2. Increase Canada’s business tax rate to match the average rate in G7 countries, and;
  3. Impose a special tax (like England and Australia have) on any Canadian business or bank that has excessively high profits like Canada’s Big Banks have had in the past several years.

Democracy Watch is also calling on Finance Minister Morneau to work with federal political parties to make key changes to stop gouging and abuse by Canada’s big banks. The Big Six Banks made a record $42.3 billion profit in 2017.

As the report also shows, most Canadians don’t benefit from excessive Big Bank profits because they don’t own shares in the banks. As the report says: “more than 80 per cent of Canadian stocks are owned (both directly and indirectly through pensions and mutual funds) by foreigners and the wealthiest households in the country.”

As well, the report reveals that Canada’s Big Banks donate to charities only 10% of what they avoid in taxes – only $2.1 billion donated compared to $23 billion in taxes avoided.

– 30 –

FOR MORE INFORMATION, CONTACT:
Duff Conacher, Co-founder of Democracy Watch
Tel: (613) 241-5179
Cell: 416-546-3443
info@democracywatch.ca

Democracy Watch’s Bank Accountability Campaign

Nine months of 2017 donations show Ontario political finance system still undemocratic – Liberals received almost 29% of donations from only 7% of donors, PCs received almost 33% of donations from only 9.4% of donors

Elections Ontario should conduct audit — would likely find high donation limit has led to funneling of donations by businesses (as happened in Quebec and at the federal level)

50-group coalition, and more than 10,000 Ontario voters, call for annual donation and loan limit for individuals (including candidates) of $100 (as in Quebec), stronger enforcement and penalties for violations, and review of annual per-vote and donation-matching public funding to prove it’s actually needed

Same changes should be made to municipal political finance system across Ontario

FOR IMMEDIATE RELEASE:
Wednesday, December 13, 2017

OTTAWA – Today, just as it predicted last year, Democracy Watch revealed that Ontario’s provincial political finance system is still undemocratic as donations under the new system from January 1, 2017 to September 30, 2017 show the Liberals and PCs receiving a large share of their donations from a very small group of people who contributed $1,000 or more, as follows:

Ontario Liberal Party:
– Total Donated (Jan. 1-Sept. 30, 2017) – $420,133.30
– Total Number of Donors – 1,501
– Total Donated in amounts of $1,000 or more – $120,795.60 (28.75%)
– Total Number of Donors donating $1,000 or more – 103 (6.8%)

PC Party of Ontario:
– Total Donated (Jan. 1-Sept. 30, 2017) – $1,391,651
– Total Number of Donors – 4,151
– Total Donated in amounts of $1,000 or more – $454.920 (32.69%)
– Total Number of Donors donating $1,000 or more – 391 (9.4%)

The Green Party had a similar pattern (2.4% of total donors (22 people) donated 13.7% ($27,087) of total donations in amounts of $1,000 or more).  Only the NDP diverted from the pattern, as only 0.5% of total donors donated $1,000, and in total only donated 3.85% ($24,965.16) of the total amount the party raised ($647,763.20).

Based on these results, Democracy Watch and the Money in Politics Coalition (made up of 50 groups with a total of more than 3 million members), joined by almost 10,000 Ontario voters who have signed a petition on Change.org, called on Ontario’s political parties to make the following changes before the legislature breaks for the upcoming provincial election:

  1. set an individual donation limit of $100 per year (as in Quebec);
  2. set a limit of what candidates can give to their own campaign of $100 per year;
  3. prohibit loans to parties except from a public fund;
  4. review the per-vote annual public funding and, if the parties can actually prove they need it, set it at at most $1 per vote, and use annual donation-matching public funding if parties prove it is needed, and;
  5. strengthen enforcement and penalties for violations.

Democracy Watch also called on Elections Ontario to conduct an audit to ensure that businesses were not funneling donations through their executives and family members (as happened in Quebec and at the federal level.

“As Democracy Watch predicted last year, Ontario’s new donation limit is much higher than the average voter can afford, and allows wealthy donors to continue to use money as an unethical way to influence politicians and parties,” said Duff Conacher, Co-founder of Democracy Watch and Chairperson of the Money in Politics Coalition.  “Ontario’s too-high donation limit is likely encouraging funneling of donations from businesses through their executives and employees and their families, as has happened in Quebec and at the federal level, and Elections Ontario must conduct an audit to ensure this isn’t happening.”

Years of experience and scandals in Quebec before 2013, at the federal level since 2007, and in Toronto since 2009, show clearly that setting a donation limit that allows individuals to donate more than $1,000 each year will allow the unethical influence of big money donations, and cash-for-access fundraising schemes, to continue in B.C.

“As Quebec, federal and Alberta donation scandals show clearly, the only way to stop the unethical, undemocratic influence of money in B.C. politics is to stop big money donations by allowing only individuals to donate only $100 a year,” said Conacher.

The many donation scandals across the country show that low donation limits are the only way to stop the influence of big money.  Few have been charged in Quebec’s corruption scandal even though an Elections Quebec audit found  $12.8 million in likely illegally funneled donations from 2006-2011. To stop the corruption, in 2013 Quebec lowered its individual donation limit to $100 annually to each party, with an additional $100 allowed to be donated to an independent candidate), and required donations to be verified by Elections Quebec before being transferred to parties and candidates.  B.C. should make the same democratic changes.

At the federal level, SNC-Lavalin illegally funneled almost $118,000 to the Liberal and Conservative parties, riding associations and candidates through its executives and employees from 2004 to 2011.  And former-Conservative MP Dean Del Mastro’s cousin was charged in 2014 with illegally funneling donations through his business’ employees.  There are likely many more examples of illegally funneling of donations at the federal level, as it seems Elections Canada has not yet done the full audit it promised to do in 2013.

As in Quebec, when Elections Alberta did an audit in 2012 it found dozens of illegal donations.  As well, in a 2013 scandal in Alberta, a coalition of construction companies made it clear that their big money donations were conditional on the Alberta government changing the labour law.

As well, the federal Liberals were caught last fall in a cash-for-access scandal as Prime Minister Trudeau and several Cabinet ministers have attended about 90 high-priced, exclusive events since January 1, 2016.  And, as the Globe and Mail reported last October 25th, one of the events was a fundraising event to be attended by Finance Minister Morneau that a drug company executive helped organize while his company lobbied Finance Canada.

Democracy Watch filed a complaint about the event with the federal Lobbying Commissioner who is investigating, and also a complaint about another event the same drug company executive organized for Justin Trudeau in August 2015, and a complaint about another event top Liberal donors were invited to in September 2016, as well as a complaint about the Trudeau Cabinet selecting their own ethics and lobbying watchdogs.  In March, Democracy Watch filed a complaint about a big money fundraising event held by a corporate board member for the Liberals in August 2014.  The Lobbying Commissioner has failed to rule on any of the complaints.

The results of Democracy Watch’s research also show that top federal Liberal Party donors (to the Party only, not its riding associations) who gave $1,100 or more in 2015 were only 4.37% of total donors (4,084 donors out of 93,426 donors total) but they gave the Party 22.87% of total donations raised ($4,866,373.76 out of the $21,276,897.57 total raised).

In addition, the federal Liberals hold special events for donors who donate $1,500 or more annually (they become members of the exclusive Laurier Club).  As the Globe and Mail reported recently, based on Elections Canada figures only 790 people (0.85% of all donors to the Liberals) donated $1,500 or more in 2015, and in 2014 only 522 people (0.68% out of 77,064 total donors) donated $1,200 or more (the amount needed then to attend a Laurier Club event).

Toronto’s experience is another example of how high donation limits allow donors to get around bans of corporate and union donations.  Such donations were banned in Toronto elections in 2009, and individual donations limited to $750 annually, but a 2016 analysis by the Toronto Star found that big business and other special interest group executives and their families continue to give large amounts to city councillors.

Loans from financial institutions must also be limited to ensure financial institutions, businesses and unions can’t use loans as a means of unethical influence.  Loans should only come from a public fund and be limited to the average total amount donated during the previous two years.

If the parties can prove that they need public funding, annual per-vote funding should be no more than $1 per vote, and the parties should implement a similar annual public funding matching system as Quebec ($2.50 for the first $20,000 raised annually by each party, and $1 for the first $200,000 raised annually).  Elections Quebec has analyzed the results of Quebec’s changes and found that the parties are still adequately funded.

“To match Quebec’s world-leading democratic system, Ontario must limit individual donations to about $100 annually and, if the parties can prove they need it, use per-vote and donation-matching public funding to give parties and candidates funding based on their actual level of voter support,” said Conacher.  “Similar changes should be made to Ontario’s municipal law, taking into account that there are no parties in most municipalities, to ensure every city and town across the province has the same democratic rules.”

The key changes that must be made in Ontario to democratize its political finance system are as follows (and similar changes should be made province-wide to the municipal political finance system, taking into account that many municipalities do not have political parties):

  1. limit annual combined total donations of money, property and services by individuals to $100-200 to each party (Quebec’s limit is $100), and establish the same limit on candidates donating to their own campaign, with donations routed through the election watchdog agency (as in Quebec);
  2. prohibit loans to political parties, riding associations and candidates, except from a public fund (with loans limited to the average annual amount of donations received during the previous two years);
  3. limit spending leading up to, and during election campaigns by parties, nomination race and election candidates, third party interest groups, and also candidates in party leadership races;
  4. require disclosure of all donations and gifts of money, property, services and volunteer labour given to any party, riding association, politician, nomination race, election or party leadership candidate, including the identity of the donor’s employer, and board and executive affiliations (and the identity of anyone who assists with any fundraising);
  5. review the annual per-vote funding for political parties and riding associations, and if the parties can prove they actually need it, give annual public funding for parties based on each vote received during the last election (no more than $1 per vote, with a portion required to be shared with riding associations);
  6. if the review shows that parties and riding associations actually need it, give annual public funding for parties matching up to the first $500,000 raised (as in Quebec where the first $200,000 raised is matched);
  7. give public funding matching up to $25,000 that each nomination race and election candidate (including an independent candidate) raises (similar to Quebec’s matching funding system), and public funding matching up to $100,000 that each party leadership campaign candidate raises, and;
  8. require election, donation and ethics watchdogs to conduct annual random audits to ensure all the rules are being followed by everyone;
  9. Elections Ontario, or the Auditor General, must be empowered to review all government advertising and to stop or change any ad that is partisan or misleading;
  10. all penalties for violating donation and spending rules must be increased to minimum $100,000 fine and a multi-year jail term, and loss of any severance payment, and a partial clawback of any pension payments, and;
  11. Elections Ontario must be required to disclose the rulings they make on all complaints they receive as soon as they make the ruling, and to disclose the rulings they make on all investigations they initiate themselves.

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FOR MORE INFORMATION, CONTACT:
Duff Conacher, Co-founder of Democracy Watch and Chairperson of the Money in Politics Coalition
Tel: (613) 241-5179    Cell: 416-546-3443
info@democracywatch.ca
Democracy Watch’s Money in Politics Campaign

Liberals’ proposed candidate for Ethics Commissioner has record of eight unethical and questionable actions as Integrity Commissioner

Mario Dion chosen through secretive, PMO-controlled, partisan process – not independent, merit-based process as Prime Minister claimed yesterday

Opposition parties not consulted – any MP with personal integrity and concern for government ethics will vote to reject Dion

Last March, Liberals had qualified candidates to replace lapdog Ethics Commissioner Mary Dawson but refuse to say how many

10,000+ call on Liberals to make changes to match Ontario’s and Britain’s world-leading appointment processes

FOR IMMEDIATE RELEASE:
Tuesday, December 12, 2017

OTTAWA – Today, Democracy Watch detailed the eight unethical and questionable actions of Mario Dion, the Trudeau Cabinet’s proposed candidate for Conflict of Interest and Ethics Commissioner, when he was Integrity Commissioner.

Democracy Watch called on all MPs to show personal integrity and concern for government ethics by voting to reject Dion. Even Liberal MPs should be very disturbed by Mr. Dion’s record, and by the fact that he was chosen through a secretive, PMO-controlled, partisan process that failed to consult opposition party leaders as required by the Parliament of Canada Act.

“Given his many unethical and questionable actions when he was Integrity Commissioner, Mario Dion would likely be just as bad a lapdog as Ethics Commissioner Mary Dawson who has let 95 percent of alleged violators off the hook, including many Cabinet ministers who clearly violated federal ethics rules,” said Duff Conacher. “If MPs have personal integrity, they will vote to reject the Trudeau Cabinet’s proposal to make Mario Dion the new Ethics Commissioner because of Dion’s record of wrongdoing, and because the Cabinet handpicked Dion through a secretive, partisan process.”

Mr. Dion’s eight unethical wrongdoing and questionable actions when he was Integrity Commissioner are as follows:

  1. Soon after starting as Integrity Commissioner in early 2011, Mr. Dion secretly warned Clerk of the Privy Council Wayne Wouters of a situation that could cause Wouters embarrassment (Democracy Watch’s opinion is that this action violated the law Mr. Dion was supposed to be enforcing, the Public Servants Disclosure Protection Act, as well as federal ethics rules. Even former Liberal Cabinet minister Joe Volpe, who faced many accusations of wrongdoing during his 2006 campaign for the Liberal leadership, was concerned about this action by Mr. Dion.
  2. In spring 2011, Integrity Commissioner Dion had only a paper audit completed of past cases that his predecessor failed to investigate properly, and he refused to fully examine many of the 228 cases the Auditor General identified as wrongfully closed;
  3. In October 2012, a Federal Court judge ruled against the Integrity Commissioner Dion’s office because it failed to investigate a whistleblower’s case properly;
  4. In October 2012, Integrity Commissioner Dion kicked one person off of his Advisory Committee for writing a letter-to-the-editor than mentioned the above Federal Court ruling (other members of Advisory Committee, including Democracy Watch, resigned in protest);
  5. In Part 1 and Part 2 of an April 2014 report, the Auditor General found “gross mismanagement” by Dion’s office in two whistleblower cases;
  6. In May 2015, a Federal Court judge again ruled against some of Integrity Commissioner Dion’s actions concerning the same whistleblower as in #2 above;
  7. In 2012, Mr. Dion declared publicly on CBC’s Inside Politics show that, given his long history in the federal bureaucracy, he recused himself in cases where he was friends with a person named in the case (see para. 41 of this case ruling for an example of a recusal). However, Dion’s registry under the Conflict of Interest Act does not list any recusals, even though subsection 25(1) of the Act clearly requires a public declaration of every recusal. Democracy Watch’s opinion is that Mr. Dion very likely violated the Act by failing to disclose his recusals, and;
  8. Mr. Dion also consistently failed to name government officials who were found guilty of wrongdoing, thereby allowing them to move on to other jobs without anyone knowing they were wrongdoers.

As Democracy Watch revealed recently, the Trudeau government’s affidavit responding to one of the court cases Democracy Watch filed in July admits that the Liberals had a “pool of qualified candidates” for the Ethics Commissioner position last March. The government has refused to disclose how many qualified candidates it had, nor why it believes Mr. Dion is the best candidate.

Ideally, as Democracy Watch is calling for in its Stop Bad Government Appointments Campaign, the government would establish two fully independent committees, one for judicial and quasi-judicial appointments, and one for other Cabinet appointments. The members for both committees would come from non-government organizations, and would serve fixed, non-renewable terms.

The committees would conduct public, merit-based searches and develop a short list of qualified candidates for each open position, and then the Cabinet would be required to choose from the short list (even better with opposition party leader approval for some of the key watchdog positions). Ontario has a committee like this to appoint provincial court judges, and Britain has such a committee to appoint judges and administrative tribunal members.. More than 10,000 Canadians have signed Democracy Watch’s Stop Political Lapdog Appointments petition on Change.org calling for these changes.

“The Trudeau government has claimed again and again that it has changed the Cabinet appointment process to make it independent and merit-based but, in fact, representatives from the PMO and ministers’ offices are making the decisions which means the process is as political and partisan as in past governments,” said Conacher. “It is very dangerous to our democracy that the Prime Minister and Cabinet can dictate who will be the government’s transparency and ethics watchdogs, and also the watchdogs for lobbying, elections and overall federal law enforcement, including enforcement of anti-corruption measures.”

“To make Cabinet appointments actually merit-based, the Trudeau Liberals must change the law to establish fully independent committees to find a short list of qualified candidates for each watchdog position, and require the Cabinet to choose from the short list,” said Conacher.

Democracy Watch also called on the Liberals, and all governments, to change the law to ensure all Cabinet appointees who watch over the government or oversee key democracy laws and processes (especially every Officer of Parliament) serve only one term.

“Like judges, all government and democracy watchdogs must only serve one term, with no possibility that the government can reappoint them, to ensure watchdogs don’t try to please the government in order to keep their job,” said Conacher. “To safeguard our democracy the ruling party must not be allowed to reappoint any government watchdog.”

– 30 –

FOR MORE INFORMATION, CONTACT:
Duff Conacher, Co-founder of Democracy Watch
Tel: 613-241-5179  Cell: 416-546-3443
Email: info@democracywatch.ca

Democracy Watch’s Stop Bad Government Appointments Campaign and Government Ethics Campaign

25,000+ petition calls on Finance Minister Morneau to stop protecting his big bank friends and make key changes to stop gouging and abuse of bank customers

Finance Minister reviewing Bank Act right now – petition calls for creation of financial consumer group, turning FCAC and Ombudsman from lapdogs into watchdogs, audits of profits and lending, and increasing penalties

Big Six Banks gouge out record profits of $42.3 billion in 2017 ($5 billion (13%) higher than in 2016, and more than double their 2010 profits) – higher than comparable banks in all other countries

Three of Canada Big Six Banks were among top 90 most profitable companies in the world in 2016, will likely move up in the rankings in 2017

Australia has launched a royal commission on bank gouging – Canada should also do a similar examination

FOR IMMEDIATE RELEASE:
Wednesday, December 6, 2017

OTTAWA – Today, as Canada’s Big 6 Banks have finished reporting their record 2017 profits which are more than double their 2010 profits, and as Finance Minister Bill Morneau reviews the Bank Act and other financial sector laws, Democracy Watch called on the Finance Minister to make the key changes to stop gouging and abuse called for by its Bank Accountability Campaign and Change.org petition that more than 25,000 people have signed.

According to Fortune magazine’s Global 500 for 2016, three of Canada’s Big Six Banks ranked in the top 500 based on their revenues but are in the top 90 most profitable companies in the world: Royal Bank ($7.84 billion in 2016 profits; ranked #50 in total profits, #304 in revenue); TD Bank ($6.64 billion in 2016 profits; ranked #65 in profits, #351 in revenue); Scotiabank ($5.36 billion ranked #88 in profits, #424 in revenue). The profits of all three, and the other three Big Six Banks in Canada, all increased in 2017 so they will all very likely rank even higher in the Global 500 for 2017. The three banks were the most profitable of the 11 Canadian companies in the Global 500 for 2016.

Democracy Watch’s September 2017 submission to Finance Canada’s review and the petition call for the following key changes to stop big bank gouging and abuse:

  1. Require banks, trust and insurance companies to promote in their mailings and emails to customers that they can join a national Financial Consumer Organization (FCO – as recommended in 1998 by the MacKay Task Force, and the House Finance and Senate Banking committees);
  2. Strengthen key consumer protection rules, and require the Financial Consumer Agency of Canada (FCAC) to do unannounced, mystery-shopper audits to find violations, and to identify violators and fine them (the FCAC hasn’t done unannounced audits since 2005, and tipped off the banks in March about their current audit);
  3. Require all banks to be covered by the Ombudsman for Banking Services and Investments (the Conservatives let TD and Royal leave OBSI and choose their own complaint judges);
  4. Require the FCAC, Auditor General or Competition Bureau to conduct regular independent audits of the profits in each banking division, and savings from withdrawal of services, and require banks to lower prices and interest rates wherever excessive profits are found (i.e. profits higher than 15% annually in any division);
  5. Require the banks to disclose detailed information annually about their service and lending records (as the U.S. has required banks to do for 30 years), and require corrective action whenever banks discriminate against customers, and;
  6. Given the big banks each make billions in profit annually, increase the meaningless maximum fine of $500,000 for violations to $50 million.

According to Finance Canada, despite the lowering of barriers to competition 15 years ago under a World Trade Organization agreement, Canada’s big banks control 93 per cent of all banking assets, and are more profitable than comparable banks in other countries, and than small banks in Canada, and Canada’s corporate sector overall. The big banks control of the market essentially allows them to gouge and abuse customers with excessive fees, high interest rates (especially on credit cards). As a result, government regulation is needed to stop them.

The federal government bailed out the banks with $114 billion in mortgage purchases during the financial industry fraud crisis in 2009. It hasn’t required the banks to do anything in return for that bailout, or for the protections from foreign competition that the government gave the banks in 1967, and continues to maintain.

In 2017, Canada’s Big Six banks continued to gouge out excessively high profits of more than $42 billion (13%% higher than in 2016, and more than double their profits in 2010) – in part by firing thousands of people, cutting services, and hiking fees and credit card interest rates. Canada’s big banks also paid their CEOs about $10 million each in 2015, and gave them bonuses that totalled more than $10 million (51% higher than in 2008).

“Will the federal Liberals continue to protect big bank executives and their multi-million salaries or will they make real changes to protect 30 million bank customers from gouging and abuse, especially by requiring banks and insurance companies to promote a national financial consumer group in their emails and mailings to their customers,” said Duff Conacher, Co-founder of Democracy Watch. “At little or no cost to the federal government or the financial services industry, financial consumers across Canada can be given a very easy way to band together to help and protect themselves through joining a national financial consumer organization they fund and run – all the federal government has to do is require the banks and insurance companies to inform their customers about the group.”

“Federal Conservatives and Liberals have watched bank’s hike fees and keep credit card interest rates up to double their profits since 2010, and the Liberals should finally take action like Australia has to audit the banks’ excessive profits,” said Conacher.

The Financial Consumer Agency of Canada (FCAC) has a very weak enforcement record since it was created in 2003. It has made only 125 compliance rulings, is prohibited from naming a law-violating bank unless it prosecutes the bank, and it has only prosecuted 2 banks (neither of them a Big Six bank). The FCAC not only lacks resources by comparison to the similar watchdog agencies in Britain and the U.S., it is also clearly a lapdog compared to these two other agencies. According to an article by Reuter last March, the FCAC has issued fines totaling just $1.7 million since 2001 (the maximum fine allowed under the Bank Act is $500,000, which is meaningless to the big banks who each make more than $10 billion in revenue annually). Since 2013 when it was created, Britain’s FCA has already issued penalties totalling more than US$3 billion, and since 2011 when it was created, the U.S. CFPB has already imposed fines of more than US$5 billion.

“The fact that the media revealed the latest wrongdoing by the banks instead of the Financial Consumer Agency of Canada shows that the agency is a lapdog not an effective watchdog, and the banks are not even required to be covered by the Ombudsman for Banking Services and Investments,” said Conacher. “The FCAC must be required to conduct unannounced mystery-shopper audits regularly, and all banks must be covered by the OBSI, and both agencies must be required to identify and penalize banks that violate the law with multi-million dollar fines”

Incredibly, the Financial Consumer Agency of Canada (FCAC) announced last March that it was going to inspect the banks’ selling practices in April. “The FCAC made a big mistake announcing an inspection a month in advance as they tipped off the banks and gave them time to cover up and clean up their wrongdoing,” said Conacher. “It’s as bad as the police giving advance notice that they are setting up a speed trap on a highway — you don’t catch anyone violating the law that way.”

According to the Bank of Canada, the banks currently have about $1.3 trillion in business loans. That makes the so-called Canadian Business Growth Fund of (eventually) $1 billion that the Liberal government announced last March a sad joke as it will amount to only 0.1% of total bank lending. Given that the fund is a joint initiative of Finance Minister Morneau and the big banks, it is clear that the federal Liberals are trying to fool Canadians into applauding the banks for this largely meaningless initiative.

“Instead of helping the banks promote a very small loan fund to help grow entrepreneurial businesses, the federal government should do what the U.S. government did 40 years ago and pass a community reinvestment law requiring the banks to disclose detailed information that will allow the public to judge whether they are discriminating against borrowers such as women entrepreneurs, and requiring the banks to take corrective action whenever discrimination is found,” said Conacher.

“Every dollar of excessive profit for the banks, and every person and business the banks unjustifiably cut off from credit, costs the Canadian economy because it means that the banks are overcharging for their essential services and loans, and choking off spending and job creation,” said Conacher.

– 30 –

FOR MORE INFORMATION, CONTACT:
Duff Conacher, Co-founder of Democracy Watch
Tel: (613) 241-5179
Cell: 416-546-3443
info@democracywatch.ca

Democracy Watch’s Bank Accountability Campaign

Group calls on Auditor General to audit performance of federal Ethics Commissioner given negligently weak enforcement record that is a sad joke

Since 2007, likely more than 1,700 politicians or officials have violated Conflict of Interest Act or MPs Code – but Ethics Commissioner has only found 12 guilty

Ethics Commissioner doesn’t do any audits of polticians and officials activities so likely only 5% of violators are caught – enforcement must be strengthened

Since 2007, Ethics Commissioner has decided not to penalize 76 of 88 people (86%) she has investigated for violating the COIA or MPs Code (and she has let another 218 people off in secret rulings – so overall only 4.7% have been found guilty)

Ethics Commissioner has not found a Liberal guilty since the Liberals were elected in October 2015 despite many clear violations – she is biased as Trudeau Cabinet has handed her 3 six-month contracts worth $100,000 each since June 2016

FOR IMMEDIATE RELEASE:

Thursday, November 30, 2017

OTTAWA – In an open letter sent today, Democracy Watch called on the Auditor General to audit federal Ethics Commissioner Mary Dawson’s enforcement record similar to the review the auditor did in 2010 of the very negligently weak enforcement record of the former federal Integrity Commissioner.  Commissioner Shepherd is the enforcer of the Conflict of Interest Act (“COIA”) and the Conflict of Interest Code for Members of the House of Commons (“MPs Code”).  Her enforcement record is as bad as the former Integrity Commissioner’s record.

Democracy Watch recently called for a similar audit of federal Lobbying Commissioner and the RCMP for their negligently weak record in enforcing the Lobbying Act and the Lobbyists’ Code of Conduct.

According to her annual reports, from April 1, 2007 up to March 31, 2017, the Ethics Commissioner completed 253 investigations of violations of the ethics rules in the COIA and the MPs Code (not including administrative reviews of things like filing accurate reports by required deadlines).  However, she released only 35 public rulings which means she made 218 secret rulings (86.1% of all rulings).

In every one of those 218 secret rulings, Commissioner Dawson found the person not guilty of violating the COIA and/or the MPs Code.  It is impossible to tell whether these were correct rulings because Commissioner Dawson’s annual reports before 2012-2013 didn’t provide any details about these rulings, and her annual reports from 2012-2013 on provide few details of the situations she investigated that led to these 218 secret rulings.

In Commissioner Dawson’s 35 public rulings, a total of 88 people were investigated for alleged violations – 12 were found guilty (13.6% ), and 76 were found innocent (86.3%).

As a result, overall of the 253 case investigations Commissioner Dawson ruled on from April 1, 2007 up to March 31, 2017, she ruled that the person investigated was guilty of violating the COIA or the MPs Code in only 4.7% of the cases.

Ethics Commissioner Dawson doesn’t mention in her annual reports that she conducts any audits, random or otherwise, of any information Cabinet ministers, Cabinet staff and appointees, and MPs submit to her or of any MP activities.  The Ethics Commissioner may have contact with a newly elected MP or newly appointed Cabinet minister, staff or appointee as they file their initial information, and then that information is reviewed annually under the MPs Code (clause 20(1)(ii)) and COIA (section 28).

However, the information that public office holders — Cabinet ministers, Cabinet staff and appointees, and MPs — disclose to the Ethics Commissioner is not audited by the Commissioner or anyone in her office.  Commissioner Dawson has testified before a House Committee more than once that she simply trusts that everyone is telling her the truth.  Because she doesn’t do any inspections or audits – which experts in law enforcement agree is necessary for effective law enforcement –  Ethics Commissioner has never caught a public office holder violating the COIA or the MPs Code.

As a result, likely she has caught only 5% of the people have done wrong – which means that likely more than 1,700 federal politicians and top government officials have violated the COIA or MPs Code since 2007.

According to Ethics Commissioner Dawson’s 2016-2017 annual report, at any one time since 2012, on average approximately 2,500 public office holders have been covered by the COIA, and 338 MPs by the MPs Code (some of whom are Cabinet MPs covered also by the COIA).   Also according to that annual report, 3,845 public office holders left office between April 1, 2012 and March 31, 2017.  Assuming approximately the same number of public office holders covered by the COIA and MP Code left their position from 2007 to 2012, over the past 10 years the Ethics Commissioner would have enforced rules that cover approximately 10,000 people.

So, overall the Ethics Commissioner has only found an implausibly low 0.12% of public office holders in violation of the COIA or the MPs Code since 2007.

In addition, Ethics Commissioner Dawson has not found any Liberal guilty of violating the ethics rules in the COIA or MPs Code since the Liberals were elected in October 2015.

Ethics Commissioner Dawson made many very questionable rulings (and made up many loopholes in federal ethics rules) from when she was appointed in 2007 up to June 2015. Since then, Commissioner Dawson has continued at the same high rate to let people off the hook for clear violations, including the following public cases:

“Ethics Commissioner Dawson has clearly failed to enforce the federal ethics law and code effectively as she has let 95 percent of alleged violators off the hook, and since 2007 has only found 12 of 10,000 people covered by the rules in violation of the rules,” said Duff Conacher, Co-founder of Democracy Watch and Part-time Professor of law and political science at the University of Ottawa. “The Ethics Commissioner has a negligently weak enforcement record as bad as the former Integrity Commissioner’s record, and so Democracy Watch is calling on the Auditor General to do a similar review as the auditor did in 2010 of the former Integrity Commissioner’s performance.”

Democracy Watch has filed a court case challenging the Ethics Commissioner for being in a conflict of interest because the Trudeau Cabinet’s re-appointed her last June to her third six-month interim term — so she is essentially currently serving at the pleasure of the Trudeau Cabinet.

Democracy Watch also recently filed a court case challenging the Ethics Commissioner’s ruling that it was fine for Liberal Finance Minister Morneau to own shares in his family company after he became Finance Minister.  Democracy Watch is also challenging the Ethics Commissioner’s illegal ethics screens in court because they cover up whether ministers are stepping aside because of conflicts of interest.

“The Trudeau Cabinet’s decision last spring to rehire lapdog Ethics Commissioner Mary Dawson while she was investigating Trudeau smells as unethically bad as Trump’s decision to fire watchdog FBI head James Comey while he was investigating Trump,” said Conacher.  “The Trudeau Cabinet handed a $100,000 contract to the person judging whether Trudeau and other ministers violated a federal law, and that is clearly unethical and also puts the Ethics Commissioner in a conflict of interest that makes her biased in favour of Trudeau and his ministers.”

Democracy Watch also called on the Trudeau Cabinet to end their conflict-ridden charade and ensure that Ethics Commissioner Mary Dawson and Lobbying Commissioner Karen Shepherd are replaced before January 2018 when their current six-month contracts end.  “In the past decade, the Ethics Commissioner and Lobbying Commissioner have been negligently weak lapdogs whose bad rulings have let dozens of people off the hook for clear violations, and the sooner they are gone the better,” said Conacher.

In addition to stronger enforcement, as the recent scandal involving Minister Morneau has shown clearly (yet again), the Conflict of Interest Act (“COIA”) and MPs Code both need to be strengthened in all the ways that Democracy Watch recommended in 2013, to ensure ethical government decision-making, and that most violators will be caught and effectively penalized.

Former Treasury Board Minister Tony Clement and the Harper Conservative government failed to do anything to implemented any changes after a House Committee reviewed the law and code in 2013, and the Liberals failed to include any promises to make changes in their 2015 election platform.  The House Committee is required to review the Lobbying Act in 2018.

– 30 –

FOR MORE INFORMATION, CONTACT:
Duff Conacher, Co-founder of Democracy Watch
Tel: (613) 241-5179    Cell: 416-546-3443
info@democracywatch.ca

Democracy Watch’s Government Ethics Campaign page and Audit Ethics Commissioner and Lobbying Commissioner Campaign page

Group calls on Auditor General to audit performance of federal Commissioner of Lobbying and RCMP given negligently weak enforcement record that is a sad joke

Likely 2,100 lobbyists have violated Lobbying Act or Lobbyists’ Code since 2008 but only 4 have been found guilty of violating Act, and only 13 have been found in violation of the Code (none since 2012)

Commissioner doesn’t do any audits to find unregistered communications with government institutions and officials — so likely only 5% of violators are caught – enforcement must be strengthened

Since 2008, the Commissioner, RCMP and Crown prosecutors have decided not to penalize 88 of the 105 lobbyists (84%) who they have caught violating the Act and Code (and they have kept the identity of the 88 violators secret)

Commissioner has taken three or more years to issue a ruling on one-third of the situations she has investigated since 2008

Commissioner has not issued a public ruling since the Liberals were elected in October 2015 despite receiving many complaints – she is biased as Trudeau Cabinet has handed her 3 six-month contracts worth $100,000 each since June 2016

FOR IMMEDIATE RELEASE:
Friday, November 24, 2017

OTTAWA – In an open letter sent yesterday, Democracy Watch called on the Auditor General to audit federal Commissioner of Lobbying Karen Shepherd’s and the RCMP performance record similar to the review the auditor did in 2010 of the very negligently weak enforcement record of the former federal Integrity Commissioner.  Commissioner Shepherd is the front-line enforcer of the Lobbying Act and Lobbyists’ Code of Conduct and the RCMP are supposed to assist in enforcement.  Together their enforcement record is as bad as the former Integrity Commissioner’s record.

From April 1, 2008 to March 31, 2017, according to Commissioner of Lobbying Karen Shepherd’s annual reports, she and the RCMP and Crown prosecutors have secretly decided not to penalize or prosecute 88 of the 105 lobbyists (84%) who have been caught violating the Lobbying Act or the Lobbyists’ Code (when you violate the Act you automatically violate the Code).  The details of why those 88 have been let off the hook are not disclosed by the Commissioner, the RCMP or Crown prosecutors.  The fact that they have been let off is mainly the Commissioner’s fault because the Commissioner is the front-line enforcer of the Act who decides whether to refer any case to the RCMP and Crown prosecutors for possible prosecution.

Using the likely very conservative estimate that, since 2008, 10,000 different people have lobbied the federal government in ways that would have required them to register under the Lobbying Act, the Commissioner and her predecessors and the RCMP have caught only 1% of those people violating the Act or the Code.

Given the weak enforcement practices, approach, attitude and record of Commissioner Shepherd and the RCMP, it is reasonable to assume that only 5% of violators are likely caught, and therefore that actually about 2,100 people have violated the Lobbying Act and Lobbyists’ Code of Conduct since 2008.

In addition, of the 189 cases that Commissioner Shepherd has reported that she has reviewed since she became commissioner in 2008, she has taken three years or more to issue a ruling on 59 (31.2%) of those complaints.

As well, Commissioner Shepherd has not issued a public ruling since the Liberals were elected despite receiving five complaints of clear violations from Democracy Watch alone since late May 2016.  She has also refused to recuse herself from investigating these complaints.  Democracy Watch filed a court case in July challenging the Commissioner of Lobbying for being in a conflict of interest because the Trudeau Cabinet’s re-appointed her last June to her third six-month interim term — so she is essentially currently serving at the pleasure of the Trudeau Cabinet.

“Lobbying Commissioner Shepherd has clearly failed to enforce the federal lobbying law and code effectively as she has failed to even name and shame 84 percent of the lobbyists caught violating the law and has taken more than three years to rule on many violations,” said Duff Conacher, Co-founder of Democracy Watch and Part-time Professor of law and political science at the University of Ottawa. “Together with the RCMP and Crown prosecutors, the Lobbying Commissioner has a negligently weak enforcement record as bad as the former Integrity Commissioner’s record, and so Democracy Watch is calling on the Auditor General to do a similar review as the auditor did in 2010 of the former Integrity Commissioner’s performance.”

On May 27, 2015, as she has in the past, Commissioner Shepherd testified before the House of Commons Standing Committee on Access, Ethics and Privacy and stated that her only enforcement action concerning unregistered communications between lobbyists and government institutions and officials is “monitoring the media.”  She didn’t do any random auditing – which experts in law enforcement agree is necessary for effective law enforcement – until the 2015-2016 fiscal year and since then has only audited communication reports filed by registered lobbyists.  To catch unregistered lobbying, obviously the phone, email, and PIN communications of ministers and top government officials must be audited.

For the 88 people who were caught but have been let off the hook, the Commissioner has kept their identity secret and has only given them warnings or required them to write an essay or be educated about the law and monitored by the Commissioner’s office for a year or so after their violation (summary information about how the Commissioner has dealt with these cases is disclosed in these reports).

Since 1988, only four people have been found guilty of violating the Act (Andrew Skaling, Bruce Carson and Jamie Carroll (see also here re: Carroll) and Hervé Pouts).

As well, only 13 people have been found guilty of violating the Code.  Commissioner Shepherd took from July 2007 until November 2011 to issue the first valid ruling on a violation of the Code, and two of the 13 (Réné Fugère and André Nollet) were only found guilty after the Commissioner was forced to issue a ruling under a court order that Democracy Watch won.  Commissioner Shepherd has not found anyone guilty of violating the Code since 2012.

The extremely low violation rate for the Act and the Code is another clear sign of negligently weak enforcement on the part of the Commissioner and her predecessors and the RCMP.  Lobbying in secret or unethically benefits both the lobbyist and also often the government official being lobbied, as they escape accountability for doing an unethical or secret deal that may make the government look bad.  As a result, it is simply unbelievable that only 1% of people who have lobbied the federal government since 2007 in ways that require registration have failed to register or have violated the Act or Code in some other way.

In addition, since 2004 at least another 71 people have been caught lobbying without registering but have been let off the hook because huge loopholes in the Act mean their secret lobbying was legal.  The loopholes include that a person is not required to register if they are doing unpaid lobbying, or if they are lobbying a regulatory agency about the enforcement of a law that applies to them or their client, or if they work for a business and lobby less than 20% of their work time.

In addition to stronger enforcement, the Act needs to be strengthened in all the ways the House Committee recommended in its May 2012 report, and more, to ensure secret, unethical lobbying is finally made effectively illegal and that most violators will be caught and effectively penalized.

Former Conservative Treasury Board Minister Tony Clement failed to do anything to implemented key changes recommended in 2012 by the Committee, and the Liberals failed to include any promises in their 2015 election platform.  The House Committee is required to review the Lobbying Act within the next six months.

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FOR MORE INFORMATION, CONTACT:
Duff Conacher, Co-founder of Democracy Watch
Tel: (613) 241-5179    Cell: 416-546-3443
info@democracywatch.ca

Democracy Watch’s Government Ethics Campaign page and Audit Ethics Commissioner and Lobbying Commissioner Campaign page