Foreign “proxies” allowed to spend unlimited funds in secret in nomination and party leadership contests, and to hide their funders, and to fundraise and lobby in secret, and high donation limits make it easy to funnel big money amounts into Canada’s political system

FOR IMMEDIATE RELEASE:
Thursday, October 24, 2024

OTTAWA – Today, as the Hogue Inquiry into Foreign Interference in Canadian politics holds its last policy roundtable on political finance loopholes, Democracy Watch released the three policy papers it has submitted to the Inquiry calling for key changes to close huge loopholes that allow for secret, undemocratic and unethical spending, fundraising, donations, loans and lobbying by foreign “proxies”.

Click here to see the policy paper on how to stop funneling of foreign big money donations and loans through “proxies”. 

Click here to see the policy paper on how to stop “proxy” third parties funded by foreign governments, entities and individuals from undemocratically and unethically influencing elections and policy making processes.

Click here to see the policy paper on how to stop secret, unethical lobbying by “proxies” for foreign governments, entities and individuals.

DWatch’s policy paper on Canada’s undemocratic, unethical donation and loans system calls for the following key changes to stop funneling of foreign big money through “proxies”:

1. Lower the annual donation and loan limit to $75 which is the amount that 75% of donors give, as DWatch’s study of donations from 2016-2022 showed (to match Quebec’s world-leading $100 donation limit);
2. Prohibit financial institutions from making loans (if parties can prove they need more funds than they can raise from voters in $75 donations, establish matching and per-vote public funding and a public loan fund to close the gap);
3. Prohibit giving fake jobs or other benefits or advantages to anyone who is considering running in a nomination or party leadership contest;
4. Prohibit donations to nomination contestants, candidates and electoral district associations (EDAs) from outside the electoral district;
5. Prohibit giving fake jobs, compensation, gifts or other benefits to contestants, election candidates or political party officials, and prohibit paying candidates for their personal, care, litigation expenses, and prohibit paying for candidates’ representatives at polling stations;
6. Require disclosure of all the identity of all donors/lenders and the amount donated/loaned, and spending, by nomination contestants, candidates and parties before voting begins, and require quarterly disclosure between elections of donations, loans and spending by EDAs and parties;
7. Require public disclosure of staff, top-level volunteers, fundraisers (and amounts raised and how) by nomination contestants, candidates, EDAs and parties, and disclosure of all volunteers to Elections Canada, and;
8. Make Elections Canada the auditor for nomination contestants, election candidates, EDAs, parties and leadership contestants.

“The only way to stop foreign big money from flowing into Canada’s political finance system is to stop big money donations and loans,” said Duff Conacher, Co-founder of Democracy Watch.  “As long as big money donations and loans are allowed, it will be easy for foreign governments, businesses and organizations to funnel large amounts of money secretly to nomination and party leadership contestants, election candidates, riding associations and parties.”

Democracy Watch also called on the Inquiry to recommend the following key changes to stop foreign governments from funding and using third-party businesses, interest groups and individuals as “proxies” to interfere in and influence Canadian elections and policy-making processes in secret, undemocratic and unethical ways, including through secret, unethical lobbying:

1. As in elections, require third parties to register and disclose all their donors and spending if they spend more than $100 during a nomination contest or party leadership contest, and prohibit them from colluding with contestants;
2. Only allow a third-party individual to spend a very small amount, and citizen groups to spend an amount based on how many voters support them, and prohibit businesses from spending, during contests, elections and policy-making processes;
3. Only allow third parties to spend money raised from Canadian citizens and permanent residents;
4. Given how many voters can be reached through low-cost social media posts and ads, require third parties to register if they spend more than $100 during a pre-election period, election period or policy-making process, including trying to influence political party officials;
5. Make Elections Canada the auditor for third parties;
6. Close all the loopholes that currently allow for secret lobbying so that all lobbying is required to be disclosed, and;
7. Reverse the changes made to the Lobbyists’ Code last year so lobbyists will again be prohibited from fundraising, campaigning and assisting politicians and party leaders.

“Loopholes in key laws mean third-party businesses, organizations and individuals are currently allowed to spend an unlimited amount of money in secret supporting or opposing nomination and party leadership contestants, to hide the identity of their funders, and to lobby Cabinet ministers, government officials, politicians and political party officials in secret,” said Duff Conacher, Co-founder of Democracy Watch.  “These loopholes must be closed or third parties will continue to be used as fronts for foreign governments and entities to interfere in and influence Canadian elections and government policy-making processes in secret, unethical and undemocratic ways.”

Democracy Watch has also submitted a list of key questions to the Hogue Inquiry to be asked of the participants in the Policy Phase roundtables held this week about the many loopholes and flaws in Canada’s election, political finance, lobbying and ethics rules, and weak enforcement systems, that make secret, unethical and undemocratic foreign interference and misinformation legal across Canada.  Click here to see the list of key questions.

Democracy Watch also filed a 32-page submission in September calling on the Inquiry to broaden the scope of its examination to address all the loopholes and flaws in federal laws, and weak enforcement systems.

Parliament did pass Bill C-70 in June after a rushed review, but Bill C-70 only closes some of the foreign interference loopholes, and it establishes a very weak, ruling-party Cabinet controlled enforcement system.  Click here to see Democracy Watch’s full submission to the House of Commons on Bill C-70, and click here to see a summary of the submission.

Click here to see the Backgrounder that summarizes all the loopholes and weak enforcement problems that make foreign interference legal and easy to do across Canada at every level of government.  Click here to see summary list of 17 key changes that need to be made to stop foreign interference.

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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 Stop Foreign Interference in Canadian Politics Campaign and Money in Politics Campaign