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Canada’s struggle against transnational crime & money laundering

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4 minute read

From the Macdonald-Laurier Institute

By Alex Dalziel and Jamie Ferrill

In this episode of the Macdonald-Laurier Institute’s Inside Policy Talks podcast, Senior Fellow and National Security Project Lead Alex Dalziel explores the underreported issue of trade-based money laundering (TBML) with Dr. Jamie Ferrill, the head of financial crime studies at Charles Sturt University in Canberra, Australia and a former Canada Border Services Agency officer.

The discussion focuses on how organized crime groups use global trade transactions to disguise illicit proceeds and the threat this presents to the Canada’s trade relationship with the US and beyond.

Definition of TBML: Trade-based money laundering disguises criminal proceeds by moving value through trade transactions instead of transferring physical cash. Criminals (usually) exploit international trade by  manipulating trade documents, engaging in phantom shipping, and altering invoices to disguise illicit funds as legitimate commerce, bypassing conventional financial scrutiny. As Dr. Ferrill explains, “we have dirty money that’s been generated through things like drug trafficking, human trafficking, arms trafficking, sex trafficking, and that money needs to be cleaned in one way or another. Trade is one of the ways that that’s done.”

A Pervasive Problem: TBML is challenging to detect due to the vast scale and complexity of global trade, making it an attractive channel for organized crime groups. Although global estimates are imprecise, the Financial Action Task Force and The United Nations Office on Drugs and Crime (UNODC) suggests 2-5% of GDP could be tied to money laundering, representing trillions of dollars annually. In Canada, this could mean over $70 billion in potentially laundered funds each year. Despite the scope of TBML, Canada has seen no successful prosecutions for criminal money laundering through trade, highlighting significant gaps in identifying, investigating and prosecuting these complex cases.

Canada’s Vulnerabilities: Along with the sheer volume and complexity of global trade, Canada’s vulnerabilities stem from gaps in anti-money laundering regulation, particularly in high-risk sectors like real estate, luxury goods, and legal services, where criminals exploit weak oversight. Global trade exemplifies the vulnerabilities in oversight, where gaps and limited controls create substantial opportunities for money laundering. A lack of comprehensive export controls also limits Canada’s ability to monitor goods leaving the country effectively. Dr. Ferrill notes that “If we’re seen as this weak link in the process, that’s going to have significant implications on trade partnerships,” underscoring the potential political risks to bilateral trade if Canada fails to address these issues.

International and Private Sector Cooperation: Combating TBML effectively requires strong international cooperation, particularly between Canada and key trade partners like the U.S. The private sector—including freight forwarders, customs brokers, and financial institutions—plays a crucial role in spotting suspicious activities along the supply chain. As Dr. Ferrill emphasizes, “Canada and the U.S. can definitely work together more efficiently and effectively to share and then come up with some better strategies,” pointing to the need for increased collaboration to strengthen oversight and disrupt these transnational crime networks.


Looking to further understand the threat of transnational organized crime to Canada’s borders?

Check out Inside Policy Talks recent podcasts with Christian LeuprechtTodd Hataley  and Alan Bersin.

To learn more about Dr. Ferrill’s research on TBML, check out her chapter in Dirty Money: Financial Crime in Canada.

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Taxpayer watchdog says Canadian gov’t needs to use Trump ‘blueprint’ and create efficiency agency

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From LifeSiteNews

By Anthony Murdoch

Canadian Taxpayers Federation director Franco Terrazzano cited the ‘crazy research’ citizens are forced to subsidize under Justin Trudeau’s Liberal government as justification for a department to ‘slash Ottawa’s wasteful, bloated bureaucracy.’

One of Canada’s most respected taxpayer watchdogs said the government needs an agency similar to U.S. President-elect Donald Trump’s forthcoming Department of Government Efficiency (DOGE) to “slash Ottawa’s wasteful, bloated bureaucracy” that under Prime Minister Justin Trudeau has funded numerous woke projects.

“This (DOGE) is the blueprint. … All we need now is a prime minister with the guts to pick up the scissors,” Canadian Taxpayers Federation (CTF) federal director Franco Terrazzano wrote in a recent blog.

Terrazzano highlighted what he called the “crazy research Canadian taxpayers are forced to subsidize” thanks to Trudeau’s Liberal government.

Examples of such “crazy” government spending include the government granting a university student $20,000 to study “Gender Politics in Peruvian Rock Music.”

Canadian taxpayers were also on the hook for $105,000 for “Cart-ography: tracking the birth, life and death of an urban grocery cart, from work product to work tool,” as well as $17,500 for “My Paw in Yours: Dead Pets and Transcendence of Species Divides in Experimental Art-Making Practice.”

Incredibly, the Trudeau government also doled out $50,000 in a scholarship award to a student to study “Playing for Pleasure: The Affective Experience of Sexual and Erotic Video Games.”

DOGE will be headed by Elon Musk and businessman and former Republican presidential candidate Vivek Ramaswamy.

“Together, these two wonderful Americans will pave the way for my Administration to dismantle Government Bureaucracy, slash excess regulations, cut wasteful expenditures, and restructure Federal agencies — Essential to the ‘Save America’ Movement,” Trump announced on Truth Social.

Terrazzano noted how a Canadian version of DOGE would be welcome in Canada, and “Those marching orders sure would sound good in a prime minister’s mandate letter to a finance minister.”

He also noted how the government has wasted billions a “multibillion dollar gun confiscation that police officers say won’t work, the $25 billion equalization scheme and taxpayer-funded media bailouts, among others.”

“The bad news for taxpayers is we pay too much tax because the government wastes too much money. The list of wasteful spending in this article is far from exhaustive,” he wrote.

“The good news is a champion of taxpayers could make massive cuts and barely anyone outside the Ottawa bubble would notice.”

 

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Canada Scrambles To Secure Border After Trump Threatens Massive Tariff

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From the Daily Caller News Foundation

By Jason Hopkins

The Canadian government made clear its beefing up its border security apparatus after President-elect Donald Trump threatened to impose sweeping tariffs against Canada and Mexico if the flow of illegal immigration and drugs are not reined in.

Trump in November announced on social media that he would impose a 25% tariff on all products from Canada and Mexico unless both countries do more to limit the level of illicit drugs and illegal immigration entering into the United States. In response, Canada Prime Minister Justin Trudeau met with the president-elect at his residence in Mar-a-Largo and his government has detailed what more it’s doing to bolster immigration enforcement.

“We got, I think, a mutual understanding of what they’re concerned about in terms of border security,” Minister of Public Safety Dominic LeBlanc, who accompanied Trudeau at Mar-a-Largo, said of the meeting in an interview with Canadian media. “All of their concerns are shared by Canadians and by the government of Canada.”

“We talked about the security posture currently at the border that we believe to be effective, and we also discussed additional measures and visible measures that we’re going to put in place over the coming weeks,” LeBlanc continued. “And we also established, Rosemary, a personal series of rapport that I think will continue to allow us to make that case.”

Trudeau’s Liberal Party-led government has pivoted on border enforcement since its first days in power.

The Royal Canadian Mounted Police (RCMP) — the country’s law enforcement arm that patrols the border — is preparing to beef up its immigration enforcement capabilities by hiring more staff, adding more vehicles and creating more processing facilities, in the chance that there is an immigration surge sparked by Trump’s presidential election victory. The moves are a change in direction from Trudeau’s public declaration in January 2017 that Canada was a “welcoming” country and that “diversity is our strength” just days after Trump was sworn into office the first time.

While encounters along the U.S.-Canada border remain a fraction of what’s experienced at the southern border, activity has risen in recent months. Border Patrol agents made nearly 24,000 apprehensions along the northern border in fiscal year 2024 — marking a roughly 140% rise in apprehensions made the previous fiscal year, according to the latest data from Customs and Border Protection.

“While a change to U.S. border policy could result in an increase in migrants traveling north toward the Canada-U.S. border and between ports of entry, the RCMP now has valuable tools and insights to address this movement that were not previously in place,” read an RCMP statement provided to the Daily Caller News Foundation. “New mechanisms have been established which enable the RCMP to effectively manage apprehensions of irregular migrants between the ports.”

Trudeau’s pivot on illegal immigration enforcement follows the Canadian population growing more hawkish on the issue, public opinion surveys have indicated. Other polls also indicate Trudeau’s Liberal Party will face a beating at the voting booth in October 2025 against the Conservative Party, led by Member of Parliament Pierre Poilievre.

Trudeau’s recent overtures largely differ from Mexican President Claudia Sheinbaum, who has indicated she is not willing to bend the knee to Trump’s tariff threats. The Mexican leader in November said “there will be a response in kind” to any tariff levied on Mexican goods going into the U.S., and she appeared to deny the president-elect’s claims that she agreed to do more to beef up border security in a recent phone call.

Trump, who has vowed to embark on an incredibly hawkish immigration agenda once he re-enters office, has tapped a number of hardliners to lead his efforts. The president-elect announced South Dakota Gov. Kristi Noem to lead the Department of Homeland Security, former acting Immigration and Customs Enforcement Director Tom Homan to serve as border czar and longtime aide Stephen Miller to serve as deputy chief of staff for policy.

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