Government of Canada Launches Consultations
More than two years ago, in the context of its procurement modernization initiative designed to ensure that it was doing business with ethical suppliers, the Government of Canada introduced a government-wide “Integrity Regime”. The Government is now seeking to review whether its objectives have been achieved. On September 25, 2017, it launched a consultation to seek stakeholders’ views on its “Integrity Regime” and took the opportunity to seek the public’s opinion on a potential deferred prosecution agreement (DPA) regime as well. The Government has published a Discussion paper entitled “Expanding Canada’s Toolkit to Address Corporate Wrongdoing: the Deferred Prosecution Agreement Stream Discussion Guide in relation to the consultation process. Stakeholders may provide their responses and comments until November 17, 2017.
A DPA regime is like a diversion program that provides an alternative to criminal proceedings. Instead of going to trial, the prosecutor can make an oﬀer to the accused to hold off on criminal charges, while the person enters into a program designed to rehabilitate them. If the accused does not comply with the terms of the agreement, the prosecution is resumed. In Canada, diversion programs are currently made available to individuals only. A DPA regime is a diversion program made available to corporations. It is often – but not always – available only for speciﬁc oﬀences related to economic crimes.
Le gouvernement canadien lance des consultations
Il y a plus de deux ans, le gouvernement canadien présentait son nouveau « régime d’intégrité ». Par ce régime, le gouvernement cherche à s’assurer qu’il fait affaire avec des fournisseurs dont le comportement est conforme à l’éthique. Dans le but de déterminer s’il a atteint ses objectifs, le 25 septembre 2017, le gouvernement lançait une consultation afin de recueillir les vues du public et des divers acteurs du milieu concernant son « régime d’intégrité ». Il en profitait pour lancer en même temps une consultation sur la possibilité d’instaurer un régime juridique permettant de conclure, au Canada, des accords de poursuite suspendue (APS). Le « Guide de discussions » intitulé « Élargir la trousse d’outils du Canada afin d’éliminer les actes répréhensibles des entreprises : Guide de discussion sur le volet des accords de poursuite suspendue » permet d’orienter le débat. Les personnes qui désirent fournir leurs commentaires dans le contexte de cette consultation peuvent le faire jusqu’au 17 novembre 2017.
Régime juridique permettant de conclure des APS
Les APS constituent en quelque sorte l’équivalent d’un programme de déjudiciarisation. Un programme de déjudiciarisation est un programme permettant aux individus d’éviter de faire l’objet de poursuites criminelles. Dans certaines circonstances, plutôt que d’intenter un procès, le poursuivant peut offrir à l’accusé de suspendre les accusations afin de lui permettre de suivre un programme de réhabilitation. Si l’accusé ne se soumet pas aux règles qu’on lui impose dans ce contexte, la poursuite criminelle est rétablie. Au Canada, de tels programmes de déjudiciarisation sont offerts aux individus seulement. Les APS sont l’équivalent d’un programme de déjudiciarisation, mais pour les entreprises. Les APS s’appliquent normalement seulement aux crimes de nature économique, bien que cela ne soit pas toujours le cas.
Diversion programs for those accused of criminal offences are not new in Canada. In Québec, for example, first-time individual accused or accused suffering from a psychiatric or medical condition may participate in a diversion program, which results in the criminal charges being dropped. Corporations may also benefit from diversion programs, such as the Competition Bureau’s Immunity and Leniency Programs.
Transparency International Canada (“TI Canada”), a non-governmental anti-corruption organization, released a report in July, 2017 “urging” the Canadian government to adopt a Deferred Prosecution Agreement (“DPA”) mechanism, modeled closely to the current regime in the U.K. A DPA is an agreement between the prosecutor and the accused suspending outstanding charges and requiring the accused to fulfill a certain number of commitments. Once the accused has completed its contractual undertakings, the prosecutor will drop the charges.
TI Canada’s Recommended DPA Mechanism
The proposed scheme, according to TI Canada, addresses all the pitfalls of the current DPA regime in the U.S., but retains all of the advantages, including encouraging greater enforcement and self-reporting, saving costs and resources for both parties, and promoting certainty and transparency for all stakeholders involved.
TI Canada recommends that the proposed DPA scheme only be available to corporate accused who are charged with economic crimes. The DPA scheme would be legislatively enacted and judicially monitored to fulfill the underlying three objectives of financial reparations, sincere compliance reform, and accountability of individual wrongdoers.
Below is a summary of the proposed regime.
On April 20, 2017, the Government of Canada introduced a new tool in the fight against federal fraud. The federal contracting fraud tip line is a joint initiative between the Competition Bureau, Public Services and Procurement Canada (PSPC) and the Royal Canadian Mounted Police (RCMP). It allows anyone who suspects unethical business practices in federal contracting, such as bid-rigging, price-fixing, bribery, undisclosed conflict of interest and fraudulent contract schemes, to report it anonymously. Individuals may report either by calling in to a toll-free number or by completing an online form. The information provided through the tip line will be shared with three federal organizations and will be used to help conduct investigations and to introduce due diligence measures, where warranted. Any suspected criminal activity that is uncovered as a result will be turned over to the Competition Bureau and/or the RCMP.
The tip line complements measures already in place at the Competition Bureau to detect fraud in the realm of federal contracting. The immunity and leniency programs are currently the most relied upon by the Competition Bureau to detect and investigate criminal offences under the Competition Act. Under these programs, individuals with evidence of criminal offenses under the Competition Act are given immunity or lenient treatment if they cooperate with the Competition Bureau and Crown in investigating and prosecuting others implicated in the illegal activity. However, the Competition Bureau has still encountered challenges over the years in securing convictions with the evidence obtained through these programs. The primary reason being insufficient resources and the lack of experience and training of Competition Bureau investigators.
This was evident in the 2014-2015 trial of several information technology companies and individuals charged with conspiracy and working together to obtain contracts with the federal government. The trial arose from charges laid following an investigation at the Competition Bureau and ultimately led to a defeat for the Competition Bureau, due to the weaknesses in the Crown’s case. At trial, it was shown that the Competition Bureau had relied almost exclusively on the testimony of self-interested people who were competing against the accused when making its referral of the case to the Director of Public Prosecutions. The Competition Bureau investigators had essentially taken the immunity and leniency reports of these individuals without independent investigation. The evidence at trial disclosed that the Bureau investigators in charge of the case, while seizing hundreds of thousands of documents from the suspect companies, failed to seek any significant material from the government agencies involved. The resulting, 8-month jury trial resulted in 60 not-guilty verdicts.
It will be interesting to see if the Competition Bureau, with its new Tip Line has learned from such cases and how it investigates future potential criminal offences under the Competition Act. By collaborating with RCMP officials, this hopefully marks the beginning of additional measures being implemented by the Competition Bureau to ensure that allegations of illegal conduct are investigated thoroughly and that only appropriate action is taken. It is not clear whether the Competition Bureau, PSPC or the RCMP will take the lead in investigations arising from tip line complaints. The addition of a combined task force, signals that the Competition Bureau is getting serious in its efforts to detect and investigate Anti-corruption crimes.
 “Government of Canada launches tip line to help Canadians report federal contracting fraud”
 “Report wrongdoing in government contracts and real property agreements”
Norm Keith, LL.M., partner at Fasken Martineau, will address this timely and important topic of the accountability, criminal enforcement and the social responsibility of corporations in Canada. Topics to be covered will include:
1. The “new normal” of criminalizing corporate behavior;
2. How the Westray Mine disaster changed corporate criminal liability;
3. The problem of proof in white collar prosecutions (Dunn & Duffy);
4. Recent examples of white collar convictions (Karigar & Kazenelson);
5. Will criminal prosecutions make businesses “more ethical”;
6. Towards a rationale model of corporate accountability and compliance.
Wednesday, March 22, 2017
Fasken Martineau, 333 Bay Street, 24th Floor, Bay Adelaide
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