Emergency Act revoked, but questions linger on legacy of financial actions

OTTAWA -

The federal government has lifted the Emergencies Act but questions remain about what might be the long-term effects of invoking such extraordinary measures to quell protests.

The financial measures carried out under the act, which included directing banks to freeze some protesters' accounts, have been a particular target for criticism and one watcher warns the damage done will linger long after the initial protests are finished.

Financial intelligence expert Kim Manchester says that banks will likely keep tracking those individuals flagged by the RCMP and their names could end up on private-sector third-party databases that banks rely on to mitigate anti-money laundering and terrorist financing.

Banks and other financial institutions were also directed to look into whether any clients seemed to be supporting the protests, and those monitoring actions could well continue, he said.

On a larger scale, Manchester says that the actions set a dangerous precedent of how government decides to go after protests, and leaves open the door to using the same tactics in the future.

He says allies will also be watching how the federal government used Fintrac and compare the actions against the protesters to the relatively few resources directed to financial crime generally.

"There are lasting consequences to this. You don't just pull out a fountain pen and sign a piece of paper and hope that it all goes away. It doesn't work like that," said Manchester, managing director of financial intelligence training company ManchesterCF.

For its part, the Canadian Bankers Association said that financial institutions moved quickly to unfreeze accounts after the RCMP cleared the individuals and entities flagged for concern, but that some accounts may still be frozen.

"While most customer accounts have been unfrozen, it is important to remember that some accounts may be frozen for a variety of other reasons, including to comply with court orders or proceedings related to illegal activities or other unrelated legal matters," said spokesman Mathieu Labreche, who declined to comment specifically on the lifting of the Emergency Act.

This report by The Canadian Press was first published Feb. 24, 2022.