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There is no rule that prevents Canadian banks from doing business with white supremacist groups

"The definition of terrorism is very vague when it comes to who banks can deal with."

by Vanmala Subramaniam
Aug 17 2017, 9:22am

There is no rule in Canada that prevents a Canadian financial institution from doing business with white supremacist groups or individuals who participate in right-wing extremist activities, including the spreading of racism and hate speech.

VICE Money got in touch with Canada’s five largest banks — TD Bank, BMO, RBC, CIBC and Scotiabank — to ask them if they had specific policies regarding the provision of services to groups and individuals who incite hatred and promote racism in Canada.

Four of the five banks did not respond to our query — TD Bank responded by declining to comment for this story.

Canadian banks are legally governed by the Bank Act, which includes the “Access to Basic Banking Services Regulations”. Under that specific provision, a Canadian financial institution cannot deny services to any individual or group based on their political views, unless the bank has “reasonable ground to believe that the retail deposit account will be used for illegal or fraudulent purposes”.

But glaringly absent from that list is any right-wing extremist group with a presence in Canada

There are certain extremists organizations, however, that Canadian financial institutions are barred from doing business with, as part of their compliance with FINTRAC legislation — the financial intelligence unit of the Canadian government that deals with money-laundering terrorist-financing activity.

They include the usual suspects – Al-Qaeda and all its affiliates, Boko Haram, Hamas, Hizbollah, Al-Shabaab and the Taliban, just to name a few.

But glaringly absent from that list is any right-wing extremist group with a presence in Canada, a number of whom have been steadily gaining traction across the country, as my colleagues at VICE have consistently documented.

In fact, in April 2016, a Canadian Border Services Agency’s Intelligence Bulletin obtained by Global News through the Access To Information Act warned that Soldiers of Odin-Canada, an extremist, anti-immigrant vigilante group was “gaining popularity”, “rapidly expanding” and “not afraid to use violence”.

The RCMP, for that matter, lists nine right-wing extremists organizations — including the Ku Klux Klan, Blood & Honour and the Skinhead Movement — in its “Terrorism and Violent Extremism Awareness Guide”.

But legally-speaking, Canadian banks are only subject to FINTRAC legislation and the Bank Act when it comes to who they can do business with, which implies that they are not obligated to deny services to white nationalist or white supremacist individuals and groups.

“The problem is that the definition of terrorism is very vague when it comes to who banks can do business with,” says Matthew McGuire, an expert in financial crime who frequently advises financial institutions on matters related to terrorist financing.

‘If you’re not on FINTRAC’s list, banks will look at you and determine if you’re a reputational risk to them. Say you’re soliciting funds for hate speech — that’s a clear crime, and the bank will tend towards divesting of that client.”

Online payment processor PayPal restricted the accounts of prominent members of America’s alt-right

It’s worth mentioning that VICE Money specifically queried the Big Five banks on whether or not an account would be suspended or frozen if the account holder is found to be publicly spewing hate speech — we received no response from any of the five banks.

The only bank-affiliated response we did get was from the Canadian Bankers Association, a financial lobbying group that works on behalf of 60 domestic and foreign banks.

“Canadian banks have a deep commitment to diversity and inclusion, and proudly invest in programs that support the vibrant, diverse communities that define Canada today. We’re also committed to conducting our business according to the law,” wrote CBA spokesperson Aaron Boles via email.

Earlier this month, online payment processor PayPal restricted the accounts of prominent members of America’s alt-right, including the white supremacist site Occidental Dissent, and the extremist, male chauvinist blogger Roosh V.

When asked by VICE Money if any Canadian white supremacist PayPal accounts had been hobbled or suspended entirely due to their affiliation with racist activities, PayPal declined to provide specifics. They did however point out that their Acceptable Use Policy which prevents their services to be used to “accept payments or donations to organizations that promote hate, violence or racial intolerance”, applies to Canada.

“It’s not a human right to have a bank account in Canada.”

“The banks have a different role than PayPal — PayPal isn’t subject to the same federal legislation that the banks have to comply with,” said Christine Duhaime, a prominent legal expert on terrorist financing and anti-money laundering.

“Look, I think Canadian banks should have policies that are very clear on their website where they say if you are engaged in an activity that promotes racism and hatred, we have the right to close your bank account because it goes against our culture,” Duhaime told VICE Money.

Duhaime points out that unlike banks in the EU, Canadian banks do actually have some amount of leverage when it comes to deciding to freeze or suspend bank accounts.

“It’s not a human right to have a bank account in Canada — it is in the EU. Over there, you can’t deny someone a bank account regardless of what they do and whom they are affiliated with.”

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