By James Langton

(June 9 – 14:35 ET) – Ottawa’s proposed anti-money laundering legislation continues to draw fire from privacy advocates.

Earlier this week, Privacy Commissioner Bruce Phillips testified before the Senate Banking Committee. He expressed severe concerns with the bill and its treatment of financial data collected by a proposed new center that will accumulate and analyze the data.

“The point I want to make is that Bill C-22, which seeks to create a new government institution, is a direct attack on the access to information legislation and the principles behind it,” says the Hon. John Reid, Information Commissioner of Canada, told the committee today.

Reid says that he can’t find any justification for the provisions that will keep Canadians from learning what data has been reported about them, and what the new center is doing with it. If this data isn’t subject to public scrutiny, he asks, how can we justify having CSIS, the RCMP, the Department of National Defence subject to it. “If this is allowed to take place, it will create a black hole in the governmental system. Black holes, as you know, have a tendency to draw in a whole range of other information.”

Reid wasn’t alone with his concerns. Greg DelBigio of the Canadian Bar Association appeared to express the CBA’s concern that the bill may “interfere with legitimate business activity.” It could also “interfere with the lawyer-client relationship… with respect to privilege and confidentiality.”

Ian Murray, chairman of the Advisory Group on Anti-Money Laundering Legislation at the Canadian Institute of Chartered Accountants and partner at KPMG, appeared in support of the legislation. But he noted the CICA’s concerns with narrowing the scope of the legislation, defining “suspicious transactions”, avoiding the duplication of reporting requirements, restricting powers of access to records, and broadening available defences and safeguards.

Murray suggested that forensic accountants could be hamstrung by the bill. “Any forensic accountant would be placed in a position of conflict between assisting his client and reporting to the center, and may have to decline the engagement.”