The Canadian Parliamentary Financial Disclosure Challenge

Updated on August 5, 2017
Stephen Sinclair profile image

Stephen Sinclair is a freelance Canadian writer who has been publishing professionally for several years.

Canadian Prime Minister Justin Trudeau appears to be among only a few members of Parliament who have disclosed their investment holdings.
Canadian Prime Minister Justin Trudeau appears to be among only a few members of Parliament who have disclosed their investment holdings. | Source
U.S. President Donald Trump
U.S. President Donald Trump | Source

A Proposition for Ye, Fair and True

This is an open challenge to Canadian members of Parliament: show Canadians what investments you own, as your U.S. counterparts do. Further, instead of only providing a snapshot of your investment holdings at one time, allow the public to inspect all of your investment transactions. Many Canadians would be shocked to learn that the investment holdings of U.S. President Donald Trump and U.S. Senator from Vermont Bernie Sanders, and all members of Congress and the Senate, are easy to search for and review online, but that comparable financial disclosure from almost all Canadian members of Parliament is elusive.

Why are politicians in the United States required to disclose what investments they own? Quite simply, they have the power to create laws that can have a dramatic impact on the fortunes of corporations. News of big government contracts often sends stocks skyrocketing. Schemes on the part of politicians to take unfair advantage of this date back to at least the 1800s, with the Crédit Mobilier scandal standing out as a prime example. Politicians can and do get rich in the stock market. At least in the United States they have some shame about it. This is an objective fact: when it comes to investment disclosure, Donald Trump, the antithesis of Justin Trudeau, for whom I hold the greatest respect, appears to have it all over Canadian members of Parliament. The man that brags about taking advantage of bankruptcy laws appears to have a higher level of integrity, and transparency, than almost all Canadian members of Parliament. Justin Trudeau appears to be among the only members to disclose his investment holdings, as reported by the Ottawa Citizen. [See author's note, below.]

In a Toronto Star article entitled "Stock market fraud -- Why Canada doesn’t scare fraudsters," and subtitled "Stock market fraud is rarely litigated in Canada, which lags behind the U.S. and U.K. in enforcement, new report card reveals," author David Olive quoted Douglas Cumming with York University, and commented.

"'Higher transparency not only means it is easier for regulators to detect fraud and prosecute cases. It also means that firms are less likely to commit fraud.' And it means Canada, in shedding a reputation as a regulatory backwater, would attract more capital from abroad and keep domestic capital from fleeing to perceived greater safety elsewhere. Which ultimately would reduce the cost of capital for Canadian firms."

Canadian Members of Parliament Who Have Publicly Disclosed Their Investment Holdings

Green Party Leader and MP for Saanich-Gulf Islands Elizabeth May
Green Party Leader and MP for Saanich-Gulf Islands Elizabeth May | Source
MP for Timmins-James Bay Charlie Angus
MP for Timmins-James Bay Charlie Angus | Source

'Full, True and Plain Disclosure'

This writer has previously pointed to National Instrument 41-101 General Prospectus Requirements' calling for for "full, true and plain disclosure," and that the continual expanding of the principle would seem to be not only a responsibility, but a logical goal of all market participants. Reading David Olive's comment, "would attract more capital from abroad," makes the proposition of Canadian MPs not disclosing their investment holdings, in the face of at least an attempt at "full, true and plain disclosure" from U.S. politicians: Donald Trump, Bernie Sanders, and the like, absurd.

As this writer has previously reported with HubPages, he is caught in the absolutely absurd situation of facing criminal charges for having the audacity to write about seemingly relevant seeming fraud, covering events that are under the veil of a publication ban. He and his lawyer, Daniel Baker, expect to challenge the constitutionality of a portion of the criminal libel provision of the Canadian Criminal Code. This writer's research has resulted in an in-depth report to Canadian Minister of Public Safety Ralph Goodale, hosted with Google Drive. If the fact that Canadian members of Parliament don't disclose their investment holdings doesn't shock readers, my report to Mr. Goodale should. Not only is Canada referred to, by one of the biggest newspapers in the country, as a "regulatory backwater," but our darn politicians can't even tell the public what shares they own?

This writer has made comparisons between seeming distribution techniques that appear to be used by Canadian private placement buyers, who take advantage of flow-through share tax programs as sweeteners to induce investors to buy stocks, such as Goldstar Minerals Inc. (TSXV: GDM), which go one to lose almost all of their value, and convicted U.S. swindlers like Jordan Belfort. Such techniques are no secrets, and well documented in works of fiction, such as the 1973 film, The Sting, and the thinly disguised 1923 biography of stock trader Jesse Livermore, Reminiscences of a Stock Operator, by Edwin Lefevre.

Should Canadian members of Parliament be required to disclose their investment holdings?

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MP for Parry Sound-Muskoka Tony Clement
MP for Parry Sound-Muskoka Tony Clement | Source
U.S. Senator from Vermont Bernie Sanders
U.S. Senator from Vermont Bernie Sanders | Source

Canada's Secret Financial Disclosure System

The financial disclosure process for Canadian members of Parliament, when it comes to investments, is cloaked under a veil of secrecy that would seem to provide the opposite of "full, true and plan disclosure."

MPs are required to file confidential financial disclosure statements with the Office of the Conflict of Interest and Ethics Commissioner, who then publishes summaries, which are available for public inspection for a limited time. Cabinet members place investments in blind trusts. Opposition leaders and MPs are said to be assumed to not "have any insider information that could create conflicts," which this writer finds suspect.

The Ottawa Citizen wrote with regard to former Prime Minister Stephen Harper.

"Because of a quirk in the ethics rules, cabinet ministers’ spouses are unencumbered by any blind trust requirements. They can trade stocks freely without detailed scrutiny of the ethics commissioner and must only declare that they hold a portfolio if its value exceeds $10,000... public ethics disclosure showed Harper’s wife, Laureen, liquidated a portfolio she held through broker Raymond James Ltd. that was partially composed of publicly traded stocks. There was no indication of which stocks were held in her name, exactly when she decided to sell them, or where the money went."

It appears that an MP in possession of inside information could potentially have a spouse act on it, and not face the "detailed scrutiny of the ethics commissioner." NPR has asked just how blind blind trusts really are. It appears that an MP could conceivably exert influence over a portfolio, fraudulently purported to be held in a blind trust.

While MPs file disclosure with the ethics office, the fact that only summaries are available, and for a limited time, is almost equivalent to not providing disclosure, at all. Mirriam Webster defines disclosure as "the act of making something known." So long as the investment holdings of MPs, and their spouses, are not available for public inspection, or "known" by the public, it would seem that true disclosure has not occurred.

For example, MP for Nipissing-Temiskaming Anthony Rota's summary lists the asset "Joint tenant of an investment account with right of survivorship with spouse with Assante Wealth Management composed of publicly traded securities." If Bernie Sanders can disclose the investments he owns publicly, it would seem that Anthony Rota, a member of the Parliament-controlling Liberal Party, could too.

Adrian du Plessis Understands

Is the Senate Expense Scandal a Smoke Screen?

How is Goldstar Minerals, and the other, nearly 100, companies I identify in my report to Ralph Goodale, any different than what was offered by Jordan Belfort? Further, with regard to Mr. Belfort, had U.S. politicians connected to him traded in stocks he used to fleece elderly people, it would have been public knowledge. How convenient is it that Canadian politicians are not required to provide the same disclosure?

Given this information, the uproar surrounding the Canadian Senate expense scandal might be seen possessing all the hallmarks of a well-thought out "straw-man" argument. Again, how convenient is it that the government-funded CBC, and the rest of the Canadian press, expend such energy covering what would seem to be almost trivial in magnitude to what could potentially be unfolding with Canadian stocks, all under a veil of secrecy, that almost any Republican or Democrat in the United States, and almost all members of the U.S. press, would agree is abhorrent.

This writer acknowledges that it is possible that this discussion is already taking place elsewhere, and that there may be individual MPs who have already disclosed their investment holdings, and would appreciate if readers, or the MPs themselves, might contact him, and provide copies, or pointers to where they are hosted online. This writer congratulates any MPs who have had the fortitude, and foresight, to voluntarily offer the their investment holdings for public inspection.

Author's Notes

Update March 31, 2017: While researching this article, I made several, unsuccessful, attempts to find evidence that Prime Minister Justin Trudeau had disclosed his investment holdings when running for office. Today, one day after publishing, I found an article with the Ottawa Citizen, "Justin Trudeau admits that he ‘won the lottery’ with $1.2 million inheritance and successful speaking business." Prime Minister Trudeau made his personal financial documents available to the newspaper in 2013, when he first ran for leadership of the Liberal Party. An earlier version of this article made an unfair comparison between Prime Minister Trudeau and U.S. President Trump, which the author regrets.

Questions & Answers

    © 2017 Stephen Sinclair

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