The loopholes allow the PM, Cabinet ministers, their staff and top government officials to all secretly profit from their decisions
Loopholes also allow for not-blind trusts and ethics smokescreens that hide, but don’t stop, conflicts of interest
Opposition parties should pass private member bill to make changes if Carney Liberal Cabinet refuses to close loopholes
FOR IMMEDIATE RELEASE:
Wednesday, October 1, 2025
OTTAWA – Today, testifying before the House Ethics Committee for its first review since 2012 of the federal government ethics law, Democracy Watch called on the Committee to recommend closing huge loopholes in the Conflict of Interest Act (COIA) that mean it really should be called the “Almost Impossible to be in a Conflict of Interest Act”. Click here to watch the Committee hearing from 4:30 pm to 5:30 pm ET.
It’s unclear how rigorous the review will be in the end, but at least the Ethics Committee is holding open meetings to review the COIA, unlike when another House committee reviewed the MP Code in secret in 2022.
“Canada’s political ethics laws and codes for Cabinet ministers, their staff and top government officials are full of loopholes that allow them to secretly profit financially from their decisions, and are weaker than the rules for senators and federal government employees, and as weak as the rules for backbench MPs, which makes no sense at all,” said Duff Conacher, PhD (Law) and Co-founder of Democracy Watch. “All federal parties need to work together to finally close all the loopholes in all federal political ethics laws and codes, and strengthen enforcement and penalties, so politicians and their staff and top government officials are no longer allowed to make unethical, self-interested decisions or secretly profit from their decisions.”
“The current ethics enforcement measure of a blind trust is completely ineffective because a trust isn’t blind at all the office holder knows what investments they put in it, choose their own trustee, are allowed to give the trustee instructions such as don’t sell anything, and the trustee is allowed to give them regular updates on his investments,” said Conacher. “And the other enforcement measure of an ethics screen is an unethical smokescreen that allows an office holder to secretly participate in almost all decisions that affect their financial interests and to secretly profit from their decisions, and so the only effective way to deal with these financial conflicts is to require office holders to sell their investments.”
Requiring office holders to sell their investments, and prohibiting the use of a blind trust, were recommended by Justice Parker in 1987 in his landmark report (pages 343-361 (esp. 360-361)) and also in the 1984 Starr-Sharp Task Force on Conflict of Interest report).
Click here to see the “dirty dozen” loopholes in the COIA are as follows, along with key changes needed to make enforcement independent, non-partisan, transparent, timely, effective and accountable.
As the “dirty dozen” list details, some of the loopholes have been created through negligently bad enforcement by the federal Ethics Commissioner since 2006, including by current Commissioner Konrad von Finckenstein, who buried eight investigations and created three new loopholes in his first six months as Commissioner.
Similar loopholes exist in the MP Code and the Senate Code, but almost all the loopholes do not exist in the ethics code and ethics directive for federal government employees.
Democracy Watch called on opposition parties to enact a private member bill closing the unethical loopholes and strengthening ethics enforcement and penalties if the Carney Liberal Cabinet refuses to introduce a government bill to make the changes.
Prime Minister Mark Carney also needs to re-enact publicly the PM Code for ministers and their staff covering accountability, ethics, fundraising, relationships with lobbyists etc. The PM Code sets out very important ethics rules that the Ethics Commissioner has stated repeatedly are enforceable requirements that define in detail key measures in the COIA. Click here to see details about the PM Code.
“If Prime Minister Carney doesn’t re-enact the code for ministers in his own name, or weakens or cancels it, it will gut Canada’s already weak, loophole-filled government ethics law, and add to his negligently weak record and attitude so far concerning ethics,” said Conacher.
Click here to see how PM Carney is exploiting loopholes in the COIA to keep millions of dollars invested in more than 655 businesses, especially the Brookfield conglomerate, while hiding that he is participating in almost all decisions that affect Brookfield and other businesses.
Many other changes are needed to other federal laws to ensure democratic good government, including closing huge secret, unethical lobbying loopholes, decreasing the donation limit in the Canada Elections Act to $75 (as the current annual individual donation limit of $3,500 (which increases by $50 each year) is essentially legalized bribery for those who can afford to make a top donation), closing huge excessive secrecy loopholes in the federal Access to Information Act, and strengthening the whistleblower protection law.
FOR MORE INFORMATION, CONTACT:
Duff Conacher, Co-founder of Democracy Watch
Tel: (613) 241-5179
Cell: 416-546-3443
Email: [email protected]
Democracy Watch’s Government Ethics Campaign