Introduction i

possible within the constraints of Introduction national security and without jeopar­ dizing the safety of Canadians. This year's Annual Report is presented in a new format and its Finally, the Committee will place contents are organized so as to be renewed emphasis on the practice of accessible and readable. To meeting academic experts and other reflect these changes and to more well­informed individuals in every precisely describe the subject of region of the country. Their views the Report, the title now includes and assessments help guide Mem­ the phrase �An operational audit bers' decisions when making . . . a core strategic of CSIS activities." The revised judgements about complaints cases, objective: to be the Annual Report is but one of the Ministerial reports, or the appropri­ most trusted and initiatives undertaken by the ateness of particular CSIS activities. Security Intelligence Review Clearly, the threat environment widely used indepen­ Committee in its continuing effort evolves and the1 circumstances of dent source of infor­ to meet a core strategic objective: Canadians change; an action or mation about to be the most trusted and widely policy appropriate at one time may used independent source of no longer be acceptable. Only by esls activities information about CSIS activities. staying in close touch with public and expert opinion can the Commit­ The Committee has set up a Web tee hope to make judgements that site! that includes its annual reports are consonant with prevailing as well as a wealth of other infor­ standards. mation and relevant documents. A list of the Committee's classified The CSIS Act, though not flaw­ reports is also available, and there less, established a governance are cross references to books, structure for security intelligence monographs, articles, and other matters that is being emulated in Web sites that we believe would be many other countries. Our senior worthwhile reading for those officials are invited to describe interested in security intelligence Canada's system to the emerging matters. The Web site, since its democracies in Central and inception in October 1996, has Eastern Europe, and foreign already received over eighty­five delegations visit Canada and the thousand visits. Committee for the same purpose. However, it sometimes seems that A third focus of the Committee's our accountability structure is less efforts is the ongoing professional well­regarded here at home than it working relationship with the Parlia­ is abroad. The Committee hopes mentary Sub­Committee on National to change this perception by Security. The Chair and Members of demonstrating to Canadians that it the Review Committee will continue is fulfilling the role set out for it to make every effort to provide the in the CSIS Act transparently and Sub­Committee with the information with considerable effectiveness. it seeks, and to answer MP's ques­ The Committee welcomes com­ tions as fully and forthrightly as

1. www.sirc-csars.gc.ca SIRe Annual Report 1996 - 1997 ii Introduction

ments on the format, utility, or any governance system to protect other aspect of its Annual Report or Canada and Canadians from threats its Web site. to security.

How slRe's Annual • Section 1 presents the Committee's Audit Report is review and audit of what the Service Organized does and how it does it. The sub­ sections represent the different Readers familiar with past SIRC methods the Committee employs on annual reports will find all of the an ongoing basis to make this information presented in previous assessment. years. However, the material is presented in a new and, we believe, • Section 2 deals with the more functional format. Committee's role as a quasi­judicial tribunal with the power to investi­ We have also attempted to make a gate complaints of various kinds. clear differentiation between Com­ mittee comments, observations and • Section 3 brings together under a recommendations bearing directly on new heading - CSIS Accountabil­ our major task - reviewing CSIS ity Structure - the Committee's and associated activities for a certain review of the multiple administra­ period of time - and the more tive and legal mechanisms that hold general background material we are the Service accountable to govern­ making available with the aim of ment, Parliament and the people of assisting Canadians and other readers Canada. to understand the context in which security and intelligence work is carried on.

The Review The latter category consists of shaded boxes set apart from the main eommittee will text that address single topics the continue to make Committee believes will be of every effort to historical, background or technical interest to readers. Unlike the main provide the body of the report, they do not reflect sub­eommittee Committee opinion or conclusions as with the information such and are intended to be strictly factual in nature. it seeks In general, the report is organized to reflect the Committee's primary functions: first, to review CSIS intelligence activities, second, to investigate complaints about CSIS and associated matters, and third, to act in concert with other parts of the

SIRe Annual Report 1996 - 1997 Section 1: A Review of CSIS Intelligence Activities 1

Section 1: by which the Service manages human sources, CSIS efforts in A Review of addressing economic espionage, and the Service's activities concerning a eSIS Intelligence particular homeland conflict. Activities lnvestigations of Emerging We concluded that Threats the esls investiga­ Since the end of the Cold War, tions were entirely A. Areas of special many states and intelligence ser­ appropriate, given the lnterest for vices of former foes have undergone rapidly changing 1996­1997 a major transition. We reviewed how CSIS investigated the new and political environment Titled �Case Studies" in past emerging threats to Canada's at the time reports, this part of the audit report national security posed by the presents the results of major re­ intelligence agencies of these states. search and analysis carried out by the Committee in the course of the The Service's investigations of year. As the new title implies, these these threats were launched at the inquiries are in addition to, and are beginning of the decade. CSIS intended to complement and obtained information from foreign reinforce, the other forms of audit intelligence agencies and inter­ research the Committee undertakes. viewed Canadians with a knowledge of developments in the states The Committee's selection of topics concerned. to be the subject of in­depth inquiry (this year there are five) is influ­ After several years of monitoring the enced by a number of factors situation, CSIS terminated most of the including inter alia, shifts in the targeting authorizations against the nature of the international threat foreign states, owing to the absence of environment, changes in technol­ evidence that they were conducting ogy, the need to monitor or follow intelligence activities against Canada. up on past Committee recommenda­ The Service retained, however, a tions, significant alterations in general authorization to cover new Government policy which the threats which might arise. We con­ Committee believes could have cluded that the CSIS investigations implications for Service activities, were entirely appropriate, given the changes in organizational structure rapidly changing political environ­ or operational emphasis within the ment at the time. Service itself, and the interests of individual Committee Members. Below, we present our conclusions about certain of CSIS activities in this This year, the subjects of the area. In most of the investigations that Committee's special interest are we examined, the Service's actions CSIS activities in the investigations were prudent. of emerging threats, the Service's foreign liaison program, the means

SIRe Annual Report 1996 - 1997 2 Section 1: A Review of CSIS Intelligence Activites

In one case, however, we saw seemed to place a negative interpre­ contradictory information about the tation on one activity which taken in seriousness of the threat and the context seemed to us to be relatively Service's actions appeared to be benign. We found that the reports excessive. CSIS provided to consumers in other parts of the government A foreign intelligence service suggested that most of the alleged investigation of note intelligence activities were innocu­ ous. Finally, we took note of the In the case of one foreign state, CSIS fact that an intelligence service conducted an extensive investigation. allied to Canada decided not to The Service believed that the foreign pursue investigations of the foreign . . . foreign intelli­ intelligence services continued to intelligence services in question. target ethnic Canadians at home and gence services were abroad. Furthermore, a foreign The Committee did encounter some attempting to agency clandestinely collected evidence that the foreign intelli­ reactivate sources information in Canada, some of gence services were attempting to which was economic, and attempted reactivate sources in Canada used in eanada . . . to sway Canadian government by the previous regime. The policies. Service's focus, however, was not so much on the current activities of The Committee examined the the foreign services, but rather on Requests for Targeting Authority for their preparations for future intelli­ this investigation.2 gence activities.

The Requests hypothesized that the Other emerging threat new intelligence services were: investigations of note

• establishing intelligence missi­ We noted several issues of concern ons abroad, including Canada; in the other investigations that we reviewed: • continuing the predecessor agencies' practice of attempting to manipulate • A CSIS official pressed a foreign ethnic communities; and diplomat posted in Canada for information although the diplomat, • �...engaged in intelligence collection who was suspected of being a foreign activities including the targeting of intelligence asset, had clearly Canadians in Canada and abroad." changed his mind about speaking with the Service. To the Committee, In addition, we examined the docu­ the officer's persistence was question­ mentation that described how the able in the circumstances. new intelligence services were continuing the practices of their • CSIS officers placed into the predecessors. Service's computer banks extensive accounts about the internal politics of In our view, the evidence of these some states. The information was activities was equivocal. For received by CSIS on an unsolicited example, we observed that CSIS basis.

2. For more information about targeting auttority, see inset on page 17.

SIRe Annual Report 1996 - 1997 Section 1: A Review of CSIS Intelligence Activities 3

• CSIS investigators repeatedly The reviews had several objectives: questioned one target. To us, the questioning appeared confront­ • to ascertain the status of several ational and out of proportion to issues that repeatedly arose in past . . . The audits the threat he posed. reviews; focused on the • The Service provided adverse • to ensure that there was no exces­ accountability information about a person to two sive or unnecessary use of powers procedures and Federal Government departments and by the Service; controls in place to an allied intelligence agency. We noted that the Service described the • to review the effectiveness of the target as a �witting agent" of a Service's tracking systems for foreign intelligence service, a information exchanges; and potentially damaging statement not substantiated by the documentary • to learn if there were systemic evidence we saw. In addition, the problems that impacted on the authority to investigate him was not Service's foreign liaison program properly approved; it did not take that had not already been identified. into account his immigration status, as required by policy. CSIS later Methodology of the current rectified the error. review esls Liaison Program with The Service operates Security Liaison Foreign Agencies Officer (SLO) posts overseas respon­ sible for liaising with police, security SIRC's reviews of the Service's and intelligence agencies in a large foreign liaison activities were number of countries. The authorities conducted pursuant to section in the host countries concerned are 38(a)(iii) of the CSIS Act.3 We aware of the Service's officers reviewed the foreign liaison pro­ presence and functions, a necessary gram in general, and the exchanges pre­condition for inter­agency of information with foreign agen­ cooperation. cies at nine posts abroad in particu­ lar. The audits focused on the In fiscal years 1995­96 and accountability procedures and 1996­97, SIRC undertook a series of controls in place, and examined reviews of the CSIS SLO posts whether CSIS had placed restric­ abroad. We conducted these audits as tions on the dissemination of certain a result of our review of the docu­ types of information to foreign mentation from one post in 1994­95.4 agencies. We also inquired into That study sought to audit the ex­ CSIS relations with foreign agen­ changes of information with other cies as carried out by its Security agencies conducted through the post Liaison Officers (SLOs) as well as solely from the documents available the SLOs' relations with Canadian at CSIS Headquarters. The findings Federal officials. prompted concern that the numerous problems we found might be systemic in nature. We then undertook to review additional SLO posts.

3. "...to review arrangements entered into by tte Service pursuant to subsections 13(2) and (3) and 17(1) [mandating eSIS to enter into arrangements witt foreign powers, agencies and international organizations1 and to monitor tte provision of information and intelligence pursuant to ttose arrangements."

4. SIRe Annual Report 1994-95, etapter 4(ii), page 28.

SIRe Annual Report 1996 - 1997 4 Section 1: A Review of CSIS Intelligence Activites

The major focus of the reviews was to exchanges" - information that CSIS examine the documentation retained at provides to foreign agencies via telecom­ CSIS Headquarters for nine SLO munications circuits - in order to deter­ posts. On­site reviews at three of mine if important information was these posts were conducted to bypassing the controls associated with the ascertain whether the material SLO posts. sampled at CSIS Headquarters from the same posts was representative of Information exchanges with foreign the information provided by the agencies were examined with the Service to foreign agencies. In following questions in mind: addition, at CSIS Headquarters we examined the correspondence from • did they conform to the statutory six other posts. For purposes of guidelines for the retention, dissemi­ comparison, we audited the informa­ nation or receipt of the information? tion disclosures to foreign agencies for the same period of time. • were they in conformity with the arrangements Canada entered into To supplement this information, we with the agency in question? interviewed Service staff at CSIS Headquarters and at selected posts, • was the information provided by and we examined open information CSIS to the foreign agency accurate from other sources (human rights and was the potential for damage to groups, for example). In addition, we the person weighed against the conducted a special audit of �direct importance of the investigation?

Background to the service's Foreign Liaison Program

From the inception of CSIS in July 1984, until 1989, CSIS had a Foreign Liaison Branch. In 1990, the Service replaced the Branch with a new system for communicating with and coordinating the efforts of the SLOs. At the time, SIRC expressed its concern about the disbanding of the Foreign Liaison Branch. The Committee regretted the loss of what it described as "An intermediary... [that could] 'blow the whistle' on the inappropriate dissemination of informa- tion abroad."5

In its place, CSIS created a new unit under a Coordinator, to provide administration and support services to the SLOs. The Coordinator reported to one CSIS executive member, while the SLOs reported directly to another. The Foreign Liaison Advisors reported to their respective operational branches, and were to monitor the correspondence exchanges and ensure that the SLOs were informed about new developments. In a previous Annual Report,6 we expressed concern about the number of SLO posts CSIS was closing and were of the opinion that, "the foreign liaison program would benefit from more attention from the Service, not less, as seems to be the trend in terms of representation overseas." For a number of years, there were few changes to the Service's posts abroad, save for the post closings, but the mid- 1990s saw a major reworking of the Service's foreign liaison strategy. Decisions to open as well as close selected Security Liaison Officer posts resulted, as did changes to the management structure of the foreign liaison program as a whole. In 1994-95, the reporting relationships and responsibilities changed for both the unit and the SLOs, as a result of an internal management study. Most notably, the overall management of the program was once again centralized under the direction of a senior manager. We understand that in 1997, to a certain extent, history will repeat itself. The foreign liaison program will be raised to Branch level once again, an initiative the Committee will report on in our next Annual Report.

5. A SIRe Review of eSIS' SLO Posts (London & Paris), 12 January 1993.

6. SIRe 1993-94 Annual Report, page 26.

SIRe Annual Report 1996 - 1997 Section 1: A Review of CSIS Intelligence Activities 5

• were the control provisions, includ­ We noted that because of the ing recording methods, for the relative isolation of the SLOs from information provided by CSIS CSIS Headquarters, the existence properly observed? of a document containing basic proce­ dures to assist them is more important Results of the review: esls' than it would be for Canada­based organizational initiatives CSIS staff. We observed that whereas in the 1980s, the Service provided the The eommittee In 1995, the first meeting of a new SLOs with a rather comprehensive regards the CSIS committee took place, the body of instruction specifically for the re­establishment establishment of which arose from posts, the �new" Procedures Manual is an internal CSIS program review. already out of date and contains only of a Foreign Chaired by the Chief of the foreign information on routine administrative Liaison Branch liaison program, the committee was procedures. established to serve as a coordinat­ as a constructive ing and information sharing body We recommend, therefore, decision between CSIS Headquarters' that the Procedures Manual branches and the overseas posts. be brought up to date, and The purpose was also to provide that it cover important post strategic direction for the manage­ issues that are not addressed ment of the Service's foreign liaison elsewhere. program. We believe the initiative is a positive one. The Service informed us that it concurs with the need to update As well, the Committee regards the the Procedures Manual on a priority re­establishment of a Foreign basis. Liaison Branch as a constructive decision. With the increasing In the course of the Committee's interdependence of the global liaison post audits, we learned that intelligence community, the liaison the Chief of the foreign liaison responsibilities of the foreign program had conducted a manage­ liaison program will also expand ment review of one SLO Post, and and a branch­level infrastructure intended to conduct others where will likely help the Service manage warranted. We regard this as a the increasing work load. sensible initiative.

In previous SLO post reviews, we Results of the review: esls have commented on the adequacy of foreign communications tracking the Service's Procedures Manual for procedures SLOs. In 1993, the Field and Liaison Unit at CSIS Headquarters published The Service's foreign liaison a Foreign Liaison Procedures Manual program must be able to respond to replace an outdated manual. The to information demands from new manual deals primarily with within the Service, as well as from administrative matters and instructs domestic and foreign agencies. SLOs to maintain a log of all incom­ However, the Committee has in ing and outgoing correspondence on the past been critical of the Service a specific form. about its unreliable system for

SIRe Annual Report 1996 - 1997 6 Section 1: A Review of CSIS Intelligence Activites

tracking the information it provides commenting on these difficulties, to foreign agencies. This problem, the Service informed SIRC that �at as well as others that arose due least part of the problem is that the to communications deficiencies post logs contain more than just the Committee identified within section 12 [intelligence] informa­ the Service, were unresolved. tion. Cooperation and administration tasks are also recorded." The eommittee Logging and data tracking In 1985, CSIS developed a form it Linked to this problem was a has in the past said was intended �to assist SIRC deficiency the Committee found in been critical of in its duty under section 38(a)(iii) the Service's system for reporting the service about to 'monitor the provision of reliable statistics on the volume of information and intelligence information exchanges carried out its unreliable pursuant to ... arrangements.'" by Security Liaison Officers. system for tracking the The written log that the Service Subsequently, and at the invitation implemented at that time was com­ of the Service, SIRC identified information it plicated and difficult to interpret, so problems perceived to exist within provides to in subsequent years, CSIS Headquar­ the Service's information recording foreign agencies ters sent out memoranda and telexes and reporting system. Thus, begin­ to help SLOs understand how to ning in late 1996, the Service complete the form. implemented a new automated system for use at SLO Posts. The During the course of our SLO system is designed to streamline reviews, we repeatedly attempted reporting procedures and address to use the logs of information SIRC accountability requirements. exchanges with foreign agencies created by SLO posts (and held at We appreciate the fact that the CSIS Headquarters). These attempts Committee's input was requested were thwarted by the difficulty in and, at first glance, it appears that locating the documents at Headquar­ the Service has attempted to address ters referred to in the logs compiled our concerns in this area. Future at the posts. The only reliable way to audits will test the success of the find and examine the documents new system. listed was to visit the SLO post itself. Distinctions between exchanges of "open" and "classified" In recent years, the Service intro­ information duced an electronic tracking system. One of the recurring issues for SIRC SIRC staff have since attempted to in its review of CSIS information check the data in the new system exchanges with foreign agencies, is against the information in the logs so the extent to which SLOs can provide as to ensure that the audit samples open information to foreign agencies. were representative of the messages We observed that the Service's sent abroad. Our current audits Operational Policy Manual makes no establish conclusively that it is not distinction between the treatment to possible to correlate the log and be afforded open and classified electronic tracking systems. In information.

SIRe Annual Report 1996 - 1997 Section 1: A Review of CSIS Intelligence Activities 7

CSIS has made a distinction, how­ SLO be required to first ever, between open information consult with management at collected as part of a section 12 CSIS Headquarters. investigation, for example, and open information to which SLOs have Information exchanges not passing access, but is not collected or re­ through SLO posts tained as part of the �corporate Our reviews of �direct (telecommu­ record." nications) exchanges" described the importance of direct links For open information that is col­ between the Service and several lected as part of an investigation, the allies for Canadian security inter­ Service's position is that the same ests. For the period under review, rules governing the disclosure of we found that the SLOs were classified information to foreign always notified when a direct agencies apply to open information exchange occurred; that all CSIS collected and held on Service files requests or responses were made under a section 12­mandated investi­ under a valid authorization; and that gation. Open information which the exchanges were captured in the comes to the attention of SLOs Service's electronic tracking via other means, however, such system. We were satisfied with the as newspapers, magazines, and Service's use of the telecommunica­ We were concerned the like, may be passed at the tions links. about the impact SLO's discretion providing it meets the Service's criteria for what is Results of the review: esls of adverse open appropriate. assessments of other agencies information that sLOs can release We were concerned about the Each year, SLOs provide CSIS impact of adverse open information Headquarters with assessments of to foreign agencies that SLOs can release to foreign the foreign agencies that cooperate agencies. We noted one case where with the Service for the purpose of the provision of open information to aiding the operational branches to a foreign agency triggered a foreign decide what should and should not agency investigation. be disseminated to these agencies. With the introduction of SLO The Committee has noted the ratings several years ago, SIRC had efforts of the foreign liaison pro­ welcomed the Service's initiative gram to deal with our concerns because it held out the prospect for regarding the provision of open better informing CSIS operational information to foreign agencies. staff about the various factors that We consider it a positive move that might influence decisions about the unit has attempted to achieve an such dissemination. Recent audits understanding in this area. have given the Committee reason to reconsider its initial enthusiasm. We recommend, however, that when an SLO decides to As noted above, the current series disclose adverse open of SLO audits was prompted by an information about Canadi­ earlier SIRC evaluation where we ans to a foreign agency, the saw that agency assessments were

SIRe Annual Report 1996 - 1997 8 Section 1: A Review of CSIS Intelligence Activites

of uneven quality and that the human ratings system are ambiguous and rights situations in several countries thus open to a level of individual were not adequately described. CSIS interpretation that reduces the system's maintains that human rights consider­ effectiveness as an operational tool. ations are taken into account. With the emergence of the new democ­ racies and with the expanding number For this latest series of reviews, we of foreign arrangements, the need for a conducted an on­site audit at the well­defined system of rating the same post that prompted the broader reliability of the foreign agencies is SLO review. We found that despite essential. poor human rights situations and political instability generally in many We recommend that the of the countries in the region covered Service revise, or at least some sLO agency by the post - in addition to high better define, its system of levels of corruption in some cooper­ evaluating the reliability of assessments did not ating agencies - these organizations foreign agencies. contain information continued to receive favourable SLO ratings. Agency assessments and on human rights human rights concerns Our survey of the foreign agency According to Ministerial Direction, ratings procedures identified specific CSIS must consider the human concerns: rights conditions in those countries with which it is considering sharing Attributing the information source information. Our recent reviews The ratings are set by the SLOs on the have found, however, that some basis of the information collected en SLO agency assessments did not post. The assessments represent the contain information on the human perceptions of the SLOs based upon rights situations for countries where their day­to­day dealings with the we would consider the discussion foreign agencies, what they read in the warranted. media and elsewhere, and information shared with SLOs by other staff at Earlier SIRC audits in the current Canada's missions abroad. series indicated that references to human rights in assessments were It is the Committee's view that where only sporadic, notwithstanding the the reliability ratings reflect the fact that human rights is an issue experience of other Government of SLOs are obliged to comment on. Canada sources available to the SLO In the aftermath of our earlier - Foreign Affairs or Immigration reports, agency assessments we saw department staff, for example - and did document the human rights in the absence of sufficient informa­ situation in a number of countries, tion held by the SLO itself, agency but there is room for improvement assessments should attribute still. Current audits identified a the ratings to the other parties. number of assessments which failed to provide current information on Definitions of reliability recent important events and others We believe the current operational that have not been updated for definitions employed in the reliability several years.

SIRe Annual Report 1996 - 1997 Section 1: A Review of CSIS Intelligence Activities 9

The Committee regards CSIS' On the policy front, a Ministerial agency assessment process as an Direction that pre­dates CSIS has opportunity that has yet to be fully outlived its usefulness in a number of exploited. We believe that this areas. We hope that a new Ministerial problem can be remedied by the Direction forthcoming will remove the Service, as evidenced by some ambiguity as regards the definitions of of the most recent assessments. foreign arrangements.

Defining types of liaison Logging of oral directions and A principal Ministerial Direction to information exchanges the Service sets out the various In two past reviews, we have noted types and levels of liaison Canada that SLOs or staff at CSIS Head­ has with foreign agencies. Coopera­ quarters sometimes failed to log tion with other agencies can range certain kinds of oral exchanges, from routine immigration vetting all specifically conversations with the way to personnel exchanges. In persons in foreign agencies and a number of SIRC studies con­ important instructions relayed to the ducted in the series examining SLO by CSIS Headquarters person­ foreign agency cooperation, we nel. We were also concerned about a found that the decision as to which statement to us by one SLO that sort of activity falls under what there was no policy direction liaison arrangement is subject to requiring that such oral exchanges varying interpretation. be logged. The CSIS Operational Policy Manual clearly states other­ The eommittee SIRC identified one exchange with wise. The Service notes that these would like to see a foreign agency which we consid­ incidents were isolated cases. the service provide ered to be inappropriate in light of existing Direction. CSIS had never For the purpose of accountability, clear definitions for asked the Solicitor General to we believe that all meetings with the various exchange approve this type of exchange with foreign agencies where operational arrangements it this particular foreign agency. CSIS information is exchanged, whether did not agree with our interpreta­ orally or in writing, should be manages tion, maintaining that the type of documented. All CSIS Headquar­ assistance rendered was in accor­ ters personnel should document the dance with an existing, Minister­ instructions they provide to SLOs, approved arrangement. regardless of the means of commu­ nication. The Committee is also of We also observed that the Service's the view that Headquarters branches definitions for the scope of arrange­ should remind staff of the existing ments appear in neither Ministerial requirement to document opera­ Direction nor in CSIS policy tional instructions conveyed orally documents. The Committee would to SLOs. like to see the Service provide clear definitions for the various exchange Our disagreement with CSIS in this arrangements it manages. area appears to focus on whether operational information has or has not been recorded. We have found some examples of where this was

SIRe Annual Report 1996 - 1997 10 Section 1: A Review of CSIS Intelligence Activites

unequivocally the case. We expect to We believe that Ministerial ap­ find more in the future if the Service proval, not just that of Ministry does not reiterate the existing policy officials, is necessary to comply to its employees in the ways sug­ with the Direction when a liaison gested above. arrangement is to be transferred to another agency, regardless of Altering or transferring existing liaison whether the scope has changed. arrangements A long­standing Ministerial Direc­ Management of Human tion requires CSIS to obtain the sources Minister's approval to establish a liaison arrangement or alter the Human sources function at the scope of an existing one. However, direction of CSIS to collect and SIRC found cases where the Service provide information to the Service. transferred agreements from one The rules which govern their agency to another in the absence of management stem from Ministerial Ministerial approval. CSIS had Direction and written CSIS policies. instead sought and obtained authori­ Following the events involving the zation from senior officials in the Heritage Front in 1994, the Direc­ Ministry of the Solicitor General. tion and the concomitant policies were amended. In the period Where the transfer takes place because following the dissemination of the an agency undergoes a name change or new directions, the Committee has received expanded responsibilities, wanted to see if the revisions to the we do not object. Sometimes, however, rules had resolved the concerns the proposal is to transfer existing we set out in our special report to arrangements to a new agency with its the Solicitor General - The own new mandate and personnel. Heritage Front Affair.

esls Management of Human sources and the Heritage Front Affair

In TheAHeritageAFrontAAffair, the Committee wrote that a CSIS source was involved in a harassment campaign7 by white supremacists. The senior Service managers said that they had not been apprised of this activity, nor did they sanction it. The Committee concluded that CSIS policy and direction in the source management area was "seriously deficient."8 SIRC accepted that sources could not merely be passive. The Committee said, however, that CSIS offi- cials "should regularly stand back from day-to-day transactions to assess the operation in its totality;" that is, they should draw up a "balance sheet" of the benefits and dangers of a particular operation. While the Committee did not "advocate detailed rules that would unduly limit CSIS," we did conclude the following: We recommend, rather, Ministerial guidelines that require CSIS management to carefully weigh the ben- efits and the dangers of each human source operation on a regular basis; taking due account of the special circumstances of each case. 9

On 1 August 1995, the Solicitor General issued a new Ministerial Direction to the Director of CSIS on human source use in response to the issues raised by the Committee in TheAHeritageAFrontAAffair. The Ministerial Direction, and the subsequent policy changes expanded the controls on sources in three areas: agentA rovocateur activities, discreditable conduct activities, and activities touching upon sensitive institutions such as campuses, religious institutions or trade unions.

7. SIRe Report. The Heritage Front Affair, Report to tte Solicitor General of eanada, Section 5, 9 December 1994, pp. 9-10.

8. The Heritage Front Affair, Section 13, p. 12.

9. The Heritage Front Affair, Section 13, p. 14.

SIRe Annual Report 1996 - 1997 Section 1: A Review of CSIS Intelligence Activities 11

We sought to examine all source tion about an imminent, non­violent operations that could influence demonstration, and subsequently dissemi­ targeted or non­targeted organiza­ nated the information to the police. We sought to tions or groups. We also sought examine all source out cases that involved agent The second case involved a CSIS provocateurs or disreputable operation that, in the view of the operations that conduct, and here we found no new Committee, posed a potential risk to could influence ones. But we identified a number of a sensitive institution - namely, the targeted or cases where sources were involved free flow of ideas on a university with sensitive institutions; of these campus. Intelligence suggested that non­targeted we audited several. there was a potential threat, and organizations or CSIS was of the opinion that the groups We concluded that the majority of threat warranted the risk. The the cases reviewed were in compli­ Service terminated the investigation. ance with the revised Ministerial Direction and written policy. We The third case gave rise to ques­ believe that the operations were tions concerning the origin of reasonable in terms of the intelli­ certain information CSIS collected. gence they yielded: in a number of The source was a government cases the potential for serious official who in the normal course of violence was very likely averted work had access to sensitive per­ because of the information gained. sonal information. The Service was Several operations involved consid­ interested in the source's knowledge erable danger to the country had about a particular community, not in they not succeeded since the information the source might have acquisition of weapons and explo­ gained through work. CSIS manag­ sives was at issue. In sum, SIRC ers did not, in our opinion, ad­ believes the operations were equately document their instructions justified and concludes that CSIS that the source was not to provide officials demonstrated adequate information acquired in this manner. control over the actions of the When SIRC researchers came sources. across information that appeared to come from the source's occupation, We found problems in three cases: inquiries of the Service were made. The first operation involved a source We subsequently ascertained that who reported on a meeting that oc­ the information was not improperly curred in the course of collecting acquired. information about a target. CSIS managers told the source that they had SIRC will continue to monitor the no interest in the milieu where the Service's management of human meeting occurred, a context which sources. involved legitimate dissent and protest. The Service's records, however, contain Economic Espionage a detailed account of a meeting attended by the CSIS targets. Much of the At the time we last commented on reporting involved statements that CSIS' economic security effort in stopped short of suggesting violence by 1993, the program was new, and the persons who were not targets. In state of knowledge about economic addition, the Service obtained informa­

SIRe Annual Report 1996 - 1997 12 Section 1: A Review of CSIS Intelligence Activites

espionage was limited. The program very difficult to differentiate be­ is now six years old and the tween the activities of private sector Committee's review indicates that companies and those of govern­ the main difficulty confronting the ments.!0 Nonetheless, a reassess­ Service in this area is its own overly ment of the Service's definition of broad definition of what constitutes what constitutes an economic threat an economic threat. and how that definition is applied in its operations, is warranted. The Service faces considerable obstacles to reasonably defining its What is an "economic threat"? role in dealing with economic threats to Canada. Economic espio­ When we examined the Service's nage can target many sectors of economic security investigations it Canada's economy, and the threats was evident that CSIS' definition of can emanate from foreign govern­ economic security - which in­ ments, agencies or individuals cludes �information of economic working on their behalf. It is often significance" - transcends those

Background to esls Economic security Program

The changing international threat environment of the post-Cold War world has pushed economics to the top of the national intelligence agendas of many countries, Canada not excluded. The Government of Canada has broadened its definition of national security to include the concept of "economic security" which CSIS defines as "the [set of] conditions necessary to sustain a competitive international position, provide productive employment, and contain inflation." Reflecting these changes in the nature of the challenges to Canadian security, the Service initiated in June 1991 a comprehensive approach to two issues: "Economic Security" and the "Proliferation of Weapons of Mass Destruction." In order to coordinate the existing organizational sections within CSIS investigating these areas, the Service formed the Requirements Technology Transfer (RTT) Unit. Economic Security and Proliferation Issues (ESPI) Unit In October 1995, the Service restructured the RTT unit into what is now the Economic Security and Proliferation Issues (ESPI) Unit. ESPI's economic security mandate is to investigate "the clandestine acquisition or transfer, by foreign governments, of proprietary/classified technology and information valuable to Canada's economic interests." Liaison!Awareness Program One of ESPI's primary means of carrying out its responsibilities is through the Liaison/Awareness Program. Under this program, ESPI meets with members of the business, government, academic, and scientific sectors in order to raise their awareness about economic security. The Liaison/Awareness Program and the ESPI investigations relating to economic security are carried out under a targeting authority from the CSIS Target Approval and Review Committee (TARC). Targeting Authority The targeting authority sets out the criteria as to what can be investigated as an "incident of economic espionage" under the Service's mandate. An incident must involve: the participation of a foreign government, activities of a clandestine or deceptive nature, the potential acquisition of proprietary/classified information or technology, and be detrimental to Canada's economic security.

10. Tte Service notes ttat foreign states are not inclined to advertise tteir involvement in tte clandestine procurement of economic intelligence. eSIS investigates to ascertain wtetter incidents are economic or industrial espionage, tte latter being tte responsibility of tte private sector.

SIRe Annual Report 1996 - 1997 Section 1: A Review of CSIS Intelligence Activities 13 technological developments many We recommend that people would regard as vital to adminis­ trative information Canada's economic security. Under collected from the Liaison! the service's definition, such Awareness Program be information can range from eco­ retained in a non­section 12 nomic policy to supplier lists. In data base. the cases we reviewed, we were hard put to see a strong link be­ We wish once again to reiterate the tween a foreign government and the view we expressed in our 1993 loss of certain types of economic review, that CSIS has a role to information, such as client!supplier protect those areas of Canadian lists. The Service states that such a technology which bear directly upon loss is considered economic espio­ national security, and about which it nage if a foreign state sponsored or is necessary to advise the govern­ The service faces facilitated the loss. ment. The Service should investi­ considerable gate only those activities that An analysis of the information constitute �threats to the security of obstacles to gathered by the Service leads us to Canada" as set out in its mandate. reasonably conclude that the Service collects defining its role and retains information not specifi­ lntra-government cooperation cally linked to threats to the security in dealing with of Canada. While the Service has Since our most recent review of the economic threats developed adequate criteria to target economic espionage investigations to eanada particular incidents of economic revealed relatively little cooperation espionage, we found that the and coordination between CSIS and Economic Security and Prolifera­ other government departments, a tion Issues (ESPI) unit investigated forthcoming SIRC study will look some incidents which did not specifically at these issues. The appear to meet those criteria. investigation of economic espionage requires that the Service have access For example, ESPI investigated to, and make efforts to employ, both several incidents that, we believe, technical and business­related did not have a demonstrable link to expertise. a foreign government, including activities that were primarily of a A Homeland eonflict criminal nature.!! The Committee reviewed the CSIS We also observed that CSIS some­ investigation of some persons in times collected information from Canada who were associated with briefings and presentations under an internal armed conflict in an the Liaison!Awareness program that overseas country. The review was often administrative, and not covered the period from April 1994 specifically linked to threats to the through March 1996, and was a security of Canada. follow­up to a previous Committee review of similar activities in the period 1990 to 1992.!2 The CSIS investigation concentrated on the activities of a small number of people who supported the conflict

11. Tte Service maintains ttat under section 2(b), it can conduct preliminary inquiries to corroborate a foreign intelligence lead on tte possibility of criminality, before advising tte police. We will judge ttese matters on a case by case basis. 12. SIRe Annual Report 1992-1993, page 22. SIRe Annual Report 1996 - 1997 14 Section 1: A Review of CSIS Intelligence Activites

through a variety of activities on Targeting decisions behalf of organizations that were parties to it. After measuring requests from CSIS officers to senior management for target­ The 1996 CSIS Public Report refers ing approval against the Service's estab­ to activities that have been used to lished policies, and seeing whether the support terrorist actions, including documents we examined substantiated the fundraising, advocacy and informa­ requests, we have determined that CSIS tion dissemination. These types of had sufficient grounds to conduct the activities could, consequently, be of investigation and employ the investigative legitimate interest to the Service methods authorized by senior manage­ under section 2(c) of the CSIS Act. ment.

Accordingly, our audit set out to To receive targeting approval, CSIS determine whether the activities policy calls for a complete and that CSIS investigated indeed balanced description of the activities represented a threat to the security of of the targets. SIRC researchers found Canada, and whether the investiga­ that one of the requests could have tion complied with legislation, been more complete and better Ministerial Direction, and CSIS balanced. For example, a request policy and procedures. We were also submission expressed concern about interested in whether the Service had the possibility of violence occurring followed up appropriately on con­ in Canada, but did not include infor­ cerns that we had expressed in the mation in the Service's files to the earlier review. To this end, we effect that a party to the insurrection examined the Service's documents at issue was unlikely to change its and, where appropriate, we sought practice of confining terrorist activity clarification of questions arising to the homeland. The Service asserts from the document review. that the inclusion of this information would not have altered the decision to approve the investigation.

esls' Role in Preventing Politically Motivated Violence

CSIS plays a pivotal role in Canada's defence against the possible threats posed by groups associated with politically motivated violence. The "threats to the security of Canada" which it is specifically charged to investigate include "activities within or relating to Canada directed toward or in support of the threat or use acts of serious violence against persons or property for the purpose of achieving a political objective within Canada or a foreign state..." [section 2(c), CSISAAct] In addition to informing the Government in general about the nature of security threats to Canada, CSIS' intelligence and advice is specifically directed at several government departments or agencies. The information can form the basis for immigration screening profiles used in processing immigrants. In specific cases, CSIS advice can play an instru- mental role in determining the admissibility of an applicant, or in the denial of citizenship. Security intelligence may also serve as a basis for determining an individual's suitability to have access to classified information, as well as assisting the police in crime prevention and in criminal prosecutions.

SIRe Annual Report 1996 - 1997 Section 1: A Review of CSIS Intelligence Activities 15 eonduct of the investigation certain investigative measures against a person rumoured to be Our review focused on a small providing funds to an insurgent number of persons who were group in the homeland. targeted, human sources who reported on the targets under In a previous SIRC audit report, we investigation, and other investiga­ expressed our concern about a CSIS tions conducted under the targeting investigator who appeared to use a authorizations. The individuals community interview in order to investigated were leading members inappropriately obtain personal of their respective organizations, information from the subject being and had been included in the earlier interviewed. In the course of the SIRC audit report. We agreed both current review, we found that the with CSIS' decision to continue Service conducted interviews in investigating the activities of these several cities across Canada to learn persons and with the means of more about the ethnic communities investigation the Service employed. and to assess the extent and nature of a possible threat. These inter­ esls had Our researchers examined CSIS views were conducted appropri­ sufficient grounds to documentation to determine if the ately. investigation was consistent with the conduct the authorization and see if the Service had We randomly selected a small investigation and reasonable grounds to suspect a threat number of human sources for to the security of Canada. review. We were interested in the employ the relevance and reliability of the investigative The targeting authority for the investi­ information provided by these methods gation was directed at groups in sources with respect to the activities authorized Canada which operated in support of under investigation, whether the the principal organization conducting management of the sources was by senior the armed insurgency in the homeland. consistent with law and policy, and management Since there are smaller, less significant whether there were any unusual groups involved in the struggle who problems. may also have adherents or supporters in Canada, CSIS found it necessary to While we found that, in general, investigate the possible supporters of CSIS' investigation was in accor­ one such group and did so under the dance with its operational policy, investigative authority assigned to the and the information it collected was principal organization. necessary for the investigation, we identified one inappropriate action. While the Committee is in accord with A source reported on the activities the Service's decision to investigate the of targets by attending a meeting smaller group, we believe it should on a campus without obtaining the have been carried out under an author­ prior approval of the Solicitor ity separately obtained. General as is set out in Ministerial Direction. CSIS has acknowledged The Committee found one instance this to be a compliance issue and is where we believe the Service had investigating. insufficient grounds to carry out

SIRe Annual Report 1996 - 1997 16 Section 1: A Review of CSIS Intelligence Activites

Liaison and exchanges of in the Service's operational and information with foreign agencies screening files, whether the Service's recommendations were In its 1993 report, the Committee consistent with this information, and We found the drew attention to a case where whether the assessments were CSIS inappropriately provided prepared in accordance with the exchanges information to a foreign agency Service's operational policy. Five with foreign about the travel plans of a Canadian randomly selected security assess­ agencies were resident to a country with a poor ments prepared by CSIS were human rights record. The most recent examined in depth. consistent review shows no incidents that with the would raise similar concerns. The Committee was in accordance agreements with the advice provided by CSIS in In all of the cases we reviewed, we all of the assessments, and found a in force found the exchanges with foreign minor omission in one. It is evident agencies were consistent with the that some information from a agreements in force.!3 prospective immigrant!refugee's immigration screening interview Quality of advice to government was in fact entered into the section under section 1214 12 data base. CSIS policy implies that the interviews of prospective CSIS discloses the information it has immigrants are not to be used for collected to government clients in other investigations. We believe that formal written reports and briefings. CSIS policy does not adequately An issue for our review was whether address the collection of section 12 these reports accurately reflected the information during section 15 information in the Service's files. We interviews. We have brought this concluded that CSIS reports to issue to the Service's attention. Government on this investigation - while tending to be general in nature The eommittee's general finding - were useful and timely. The Committee has found that the section 15 immigration security Service's investigation in this matter assessments15 was appropriate and that it was carried out in accordance with The aim of this review was to assess legislation, Ministerial Direction, the appropriateness of CSIS actions and policy. We note also that with respect to the powers it exer­ following concerns expressed in cises under section 15 of the CSIS SIRC's 1993 report, the Service Act in connection with individuals adjusted its conduct of the investiga­ from the same country whose tion in a satisfactory manner. conflict was the subject of the broader CSIS investigation.

SIRC wanted to ascertain whether the information in the briefs CSIS prepared on prospective immigrants was consistent with the information

13. For additional information on tte eSIS Liaison Program witt 15. Under section 15 of tte CSIS Act, tte Service tas tte sole responsibility Foreign Agencies see page 3 of ttis report. for security screening applicants for landed immigrant and refugee status.

14. Section 12 of tte CSIS Act mandates tte Service to collect, analyse and retain information on ttreats to eanada and "report to and advise" tte Government about wtat it tas learned.

SIRe Annual Report 1996 - 1997 Section 1: A Review of CSIS Intelligence Activities 17

B. Annual Audit of esls principal duty - security intelli­ Activities in a Region gence investigations authorized of eanada under sections 2 and 12 of the CSIS Act.!7 When examining any instance Every year the Committee audits the in which CSIS has embarked on an entire range of CSIS investigative investigation, the Committee has activities - targeting, special three central concerns: operations, surveillance, warrants, and the use of community inter­ • did the Service have reasonable views - in a particular region of grounds to suspect a threat to the Canada. A comprehensive exami­ security of Canada? nation such as this provides insight into the various types of investiga­ • was the level of the investigation tive tools the Service has at its proportionate to the seriousness and disposal, and permits the Committee imminence of the threat? to assess how new Ministerial Direction and changes in CSIS • did the Service collect only the policy are implemented by the information that was strictly neces­ operational sections of the Service.!6 sary to advise the government on the threat? The Targeting of lnvestigations Committee researchers also keep The targeting section of the regional watch generally on the manner of audit focuses on the Service's the Service's adherence to its own internal policies, rules and direc­ tives.

Management of Targeting

Target Approval and Review Committee (TARC) CSIS' capacity to target (or launch an investigation into) the activities of a person, group or organization is governed by policies that rigorously control the procedures and techniques to be employed. The Target Approval and Review Committee (TARC) is the senior operational committee within CSIS charged with considering and approving appli- cations by Service officers to launch investigations. TARC is chaired by the Director of CSIS and includes senior CSIS officers and representatives of the Department of Justice and the Ministry of the Solicitor General. Levels of Investigation There are three levels of investigation, with Level 3 being the most intrusive and accompanied by the most stringent legal controls and management challenges. Level 2 investigations may include personal interviews and limited physi- cal surveillance. Level 1 investigations are for short durations and allow CSIS to collect information from open sources and from records held by foreign police, security or intelligence organizations.

Issue-Related Targeting An issue-related targeting authority allows CSIS to investigate the activities of a person, group or organization that may on reasonable grounds be suspected of constituting a threat to the security of Canada, and are related to or emanate from that specific issue.

16. Since tte 1995-96 audit of warrants was not completed in time for inclusion in tte 1995-96 SIRe Annual Report, ttis audit report also presents tte eommittee's conclusions from last year's audit of eSIS warrant activities in a different region.

17. Section 2, paragrapts (a) to (d) define tte ttreats to tte security of eanada. Section 12 provides eSIS witt tte mandate for tte collection, retention, analysis, and distribution of security intelligence.

SIRe Annual Report 1996 - 1997 18 Section 1: A Review of CSIS Intelligence Activites

Methodology of the audit The Committee's analysis indicates that the RTA failed both to articu­ In the region at issue, the Committee late the specifics of the economic randomly selected ten investigations interests it asserted were at risk or to conducted by CSIS in the course of connect the alleged activities with the 1995­96 fiscal year for study - the particular foreign country. five counter terrorism cases and five Appearing prominently in the that were counter intelligence in request to TARC was the term nature. SIRC researchers reviewed �Canadian economic interests," yet all files and operational messages in the phrase was employed in a vague Was the level of the Service's electronic data base, manner. While the targeting authori­ the investigation and interviewed the CSIS officers zation provided the CSIS regional proportionate to who carried out the investigations as office with the mandate to investi­ well as the managers who oversaw gate �foreign influenced activities," the seriousness them. the examples of the activities that and imminence of CSIS cited to support the request Ten cases - the eommittee's were not accompanied by evidence the threat? findings that these were clandestine or deceptive activities of the foreign Inappropriate targeting authority government at issue. Nor was there The first case pertained to the clandestine an indication of a threat to any activities of a foreign government in person. Canada. In the prescribed manner, Counter Intelligence Branch submitted a request to The Committee has drawn the the Target Approval and Review Commit­ attention of CSIS officials to our tee (TARC), to investigate the activities conclusions on this case. CSIS conducted or supported by a foreign state asserts that sufficient and reasonable directed against Canada's economic grounds existed to suspect that interests. The Targeting Committee espionage activity had taken place approved the Request for Targeting in Canada. Authority (RTA) and the investigation began. It is the Committee's view, how­ "Issue-related" investigations ever, that the Service's RTA did not The second case pertained to an demonstrate a strong connection between ongoing counter terrorism investiga­ the activities of the foreign government tion. In January 1996, TARC renewed and potential acts of espionage against an earlier authorization and agreed to Canadian economic interests.

eounter lntelligence and eounter Terrorism

The terms "counter terrorism" and "counter intelligence" reflect the Service's organi- zational structure wherein the main national security investigative functions are di- vided in two: the Counter Terrorism Branch addresses threats to the public safety of Canadians and national security caused by war, instability and civil strife abroad, as well as international terrorism. The Counter Intelligence Branch monitors threats to national security stemming directly from the espionage activities of other national governments' intelligence operations.

SIRe Annual Report 1996 - 1997 Section 1: A Review of CSIS Intelligence Activities 19 increase the intrusiveness of this and groups that are not themselves particular issue­related investigation to CSIS investigative targets. Level 3. All CSIS regions were autho­ rized to investigate the suspected threat The Service responded to the of serious political violence associated Inspector General stating that these The service used its with the issue. �investigations were only begun investigative powers when the 'reasonable grounds to with parsimony While the Committee observed no suspect' standard" had been satis­ problems with the conduct of the investi­ fied. The Inspector General was not gation per se -­ regional investigators convinced that it was possible for collected only the information that was the grounds to be clearly docu­ �strictly necessary," and there was no mented and specific enough to evidence of extensive reporting on justify an investigation in such individuals who were not the subject of cases. a specific targeting authority - we have serious reservations about the Target­ The Committee shares the Inspector ing Committee's decision to increase the General's concerns that issue­ investigation's level of intrusiveness. related investigations can cover Several CSIS regional assessments persons and groups who are not indicated that the threat was either low targets. For the case at issue, or non­existent, not in our view, however, we found that the Service sufficient justification to move from used its investigative powers with Level 2 to Level 3. parsimony; regional investigators did not collect personal information The Committee has also been made on persons who were not subject to aware of reservations about issue­ a specific targeting authority. related investigations generally as The service's RTA expressed by the Inspector General of Ministerial approval for intra-government did not demonstrate a CSIS. In the studies supporting his cooperation strong connection 1995 Certificate, he wrote that he was Four of the ten audit investigations concerned that issue­related investiga­ involved current or past Federal Govern­ between the activities tions potentially involve entire commu­ ment employees. In each case, the of the foreign govern­ nities and allow CSIS to collect and Committee concurs with the original ment and potential retain, as a part of the investigative decision to investigate, however, for three record, a wide assortment of personal of the four we have concerns about the acts of espionage and other information on individuals manner in which the investigation was conducted.

The Role of the lnspector General of esls

The Inspector General of CSIS is responsible to the Solicitor General and functions effectively as the Minister's internal auditor for CSIS, reviewing the operational activi- ties of the Service and monitoring compliance with its policies. Every year the Inspec- tor General must submit to the Minister a "Certificate" stating "the extent to which [he or she] is satisfied," with the activities of the Service as outlined in CSIS annual report to the Minister. The Security Intelligence Review Committee also receives a copy of the Inspector General's Certificate.

SIRe Annual Report 1996 - 1997 20 Section 1: A Review of CSIS Intelligence Activites

CSIS has standard agreements with a inquiries and conducted several number of Federal Government interviews with the target's col­ departments that define whether and leagues and supervisors at his place how protected information can be of work. Although the Service had released to the Service. These signed an agreement with that arrangements are authorized under Federal department to share infor­ section 17 of the CSIS Act and are mation and intelligence, the CSIS approved by the Minister. In the investigators sought information first case at issue, the Service made from employees who were not several inquiries of the target's designated in the agreement. One employer, a Federal Government employee did not believe that he agency with which CSIS has no such should provide the information to formal cooperation agreement. CSIS. Instead, he referred the Service to another, authorized CSIS investigators asked a senior employee. The meeting that ensued official in the department to consult was not properly documented in the the person's security file and they Service's files. interviewed the person's supervisor. We saw no evidence of Ministerial The Service maintains that a section 17 approval for contacts of this sort. agreement does not preclude contact with other members of a government It is the Committee's view, however, institution, in order to collect informa­ that exchanges of information of the kind tion pursuant to the conduct of a section that occurred in this case constitute 12 investigation. �cooperation" and so fall under the provisions of section 17. Furthermore, Reasonable expectation of privacy and the Committee's interpretation of section the Charter of Rights and Freedoms The service still 17 is that in the absence of a formal In the third case, CSIS acquired a requires the solici­ agreement, the Service still requires the certain type of information from a tor General's ap­ Solicitor General's approval to �enter government agency which regarded into an arrangement with or otherwise the information as the property of proval to "enter into cooperate with" government agencies. the agency. The agency in question an arrangement with believed, therefore, that it had the or otherwise cooper­ We believe that CSIS authority to give the information to should obtain the Solicitor the Service, and CSIS officers ate with" govern­ General's approval to ex­ believed no additional procedures ment agencies change information with or were required to fulfill the Service's otherwise cooperate with obligations under the CSIS Act. government departments and agencies with which it does Given the nature of the information not have formal arrange­ and the form in which it was kept, ments. the case raises some serious issues for the Committee. These involve, Non-compliance with a formal cooperation inter alia, the reasonable expectation arrangement of privacy on the part of the target, In another case involving Federal whether CSIS should have filed a employees, CSIS investigators made request for the information under the

SIRe Annual Report 1996 - 1997 Section 1: A Review of CSIS Intelligence Activities 21

Privacy Act, and whether Four cases highlighted no additional the manner of acquisition of the problems information could constitute an In the remaining four cases, we found �unreasonable search" under section that the Service had reasonable 8 of the Canadian Charter of Rights grounds to suspect threats to national and Freedoms. security. The targeting levels of the investigations were proportionate to the There is little precedent in law or in seriousness and imminence of the threats. operational practice to assist the The Service collected only the informa­ Committee to a swift finding on the tion that was strictly necessary to advise matter. Following additional analysis of the government about the threats. the information exchanged, the Com­ mittee is conducting further research Obtaining and lmplementing into the case and its implications for Federal eourt Warrants CSIS policy in the future. Obtaining Warrants - Allaying suspicions created by CSIS Methodology of the Audit investigations In respect of all the audited investi­ In order to obtain a warrant, CSIS gations of government employees, must present its case to the Court in the Committee is concerned that the the form of an affidavit. Every year, Service's inquiries may have left the the Committee examines a number of employers concerned with a nega­ affidavits with three questions in tive impression about their mind:!8 The service's inquiries employees. • is the affidavit factually accurate may have left the As a necessary part of the investiga­ according to the CSIS information employers concerned tion, CSIS alerts the employers to its used to substantiate the affidavit; with a negative impres­ security concerns, but does not as a matter of course notify them about its • is the case in the affidavit presented sion about their conclusions when the investigation is to the Court in its proper context; employees complete. It is highly likely, therefore, and that employers are left with the impression that employees represent • are the facts and the circumstances continuing threats to Canada's fully, fairly and objectively ex­ security. pressed in the affidavit.

Consequently, the Committee In order to satisfy ourselves that the recommends that unless there affidavits are appropriate, we are specific operational compare the facts presented to the considerations that preclude information found in the Service's it, the Service should in future files. inform Federal departments concerned about the conclu­ eommittee findings, 1994-95 sions it has drawn about warrant affidavits Federal employees investi­ gated. Incomplete affidavits Two affidavits were examined. The first was an emergency request from

18. Over tte course of tte last fiscal year, tte eommittee completed reviews of Federal eourt warrants obtained by eSIS in two regions. Tte first review began late in 1995-96 for tte period 1994-95 and we were unable to present our conclusions in ttat year's annual report. Tte second warrant review took place in 1996-97, for activities in 1995-96, and covers tte same region as tte otter audits in ttis ctapter.

SIRe Annual Report 1996 - 1997 22 Section 1: A Review of CSIS Intelligence Activites

the regional office, and while applications are reviewed both we found the urgency of the warrant within CSIS and the Ministry of the to have been justified, we believe Solicitor General to ensure that the the affidavit could have been affidavits are operationally and prepared with greater care. For one legally correct. An independent of the persons targeted by the legal counsel from the Department warrant, the affidavit overstated a of Justice then serves as an objec­ fact. For another person targeted, tive final assessor of the affidavit the Service failed to include in the and the facts supporting it, prior to affidavit significant information of submission to the Federal Court. which it was aware which contra­ dicted its own position on the The preparation process is tracked person. in diary form, which in the case of one affidavit, seemed to indicate to The second application sought a the Committee that the indepen­ renewal of warrant powers against a dent legal counsel did not have long­standing CSIS target. The sufficient time to review the Committee noted a minor contradic­ extensive documentation support­ tion between the affidavit and the ing the application. The Service information in the Service's files. subsequently informed the Com­ Had this contradictory information mittee that while it was not re­ been included in the affidavit, the corded in the tracking system, the Court would have been more fully independent counsel had in fact informed of all the relevant facts. In received a time extension to allow general, however, the affidavit was him to conduct a proper review factually accurate and correctly before the warrant was obtained. defined the context of the investiga­ tion. eommittee findings, 1995-96 warrant affidavits Inaccurate tracking of warrant preparation Again the Committee examined two The procedures by which CSIS tracks affidavits and supporting documents the preparation of warrant in depth. For one warrant, in the applications is also of interest to the counter intelligence area, we found no Committee. Normally, warrant errors or omissions, and no problems of balance in the presentation.

The Use of Warrants to lnvestigate Threats to National security

If during a CSIS investigation a section 21 warrant is required to investigate threats to national security, the Service must seek approval from the Federal Court. CSIS Legal Counsel, with the assistance of Service analysts, prepares an affidavit in support of the warrant to present to the Court. The affidavit explains why warrant powers, such as tele- phone intercepts, are needed, and the document must also meet other statutory requirements. For example, under section 21(2)(b) of the CSISAAct, the Service must show that other investigative means have failed, or are "unlikely to succeed." The warrant granted on the basis of the affidavit lists the powers given to CSIS, who will be subject to them, and where they may be deployed. The warrants also contain any conditions imposed by the Court on the manner in which CSIS can carry out its investigation.

SIRe Annual Report 1996 - 1997 Section 1: A Review of CSIS Intelligence Activities 23

Discrepancies in an affidavit have complied conscientiously with the However, with the second audited warrants' terms and conditions. warrant - directed at counter terrorism targets - we found a Warrants for two new number of discrepancies between areas of inquiry the statements in the affidavit, and An additional focus of this year's the documents in the �schedule of review of warrant implementation facts." In several cases, the Service was an examination of the new wrote that it had �established" challenges the Service faces in certain associations or certain exercising powers granted by patterns of contact. The supporting warrants. Federal Court warrants are documentation, however, was often now required for two new areas of equivocal, and in our view, the facts inquiry, which have �reasonable appeared to be weaker than the expectation of privacy" implications language suggested. In some cases, which the Service has recognized. the schedule of facts contained documents that seemed to contradict The Committee has recommended the Service's case. that CSIS adopt clear policy about We believe the the requirement for a Federal Court affidavit could have In the view of the Committee, these warrant to collect information in been prepared with discrepancies did not undermine the these instances. case for targeting the persons named greater care in the affidavit; that is, the affidavit As this is a new area, the Committee was fundamentally sound, and the intends at a later date to conduct an security threat it addressed was in­depth review of the impact on the serious. Most of the problems Service's requests for and execution stemmed from documents that were of these warrants. omitted from the schedule of facts, and the discrepancies between the Audit of sensitive Operations supporting documents and the and Associated Ministerial affidavit. Direction

After conducting further research, Methodology of the audit we concluded that this particular affidavit was an aberration, and not The very nature of sensitive operations a trend. We believe, however, that dictates that they are the subject of CSIS should maintain a consistent relatively frequent Ministerial Direc­ high level of rigour in the process of tion. In addition, policy for implement­ compiling and reviewing facts and ing sensitive operations is set out in supporting documentation, em­ some detail in the CSIS Operational ployed in affidavits. Policy Manual and all requests for sensitive operations, depending on the Warrant implementation ­ level of sensitivity, require at a mini­ findings mum, the approval of Service senior management. The Committee reviewed the imple­ mentation of warrants against two CSIS targets and found the Service to

SIRe Annual Report 1996 - 1997 24 Section 1: A Review of CSIS Intelligence Activites

"Reasonable Expectation of Privacy" and eanadian Law

The phrase "reasonable expectation of privacy" encapsulates a vital principle of Canadian law with respect to when and under what conditions the State may intrude on the privacy of an individual. Managing security intelligence involves constant weighing of the balance between two imperatives - individual privacy and threats to Canada. In commenting for the Department of Justice on the Supreme Court of Canada's CharterAofAHumanARightsAandAFreedoms decisions in this area, Graham Garton, Q.C. wrote: Respect for individual privacy is an essential component of what it means to be "free." As a corollary, the infringement of this right undeniably impinges upon an individual's "liberty" in our free and democratic society. It is apparent, however, that privacy can never be absolute. It must be balanced against legitimate societal needs. This Court has recognized that the essence of such a balancing process lies in assessing reasonable expectation of privacy and balancing that expectation against the necessity of interference from the State. Evidently, the greater the reasonable expectation of privacy and the more significant the deleterious effects flowing from its breach, the more compelling must be the State objective, and the salutary effects of that objective, in order to justify interference with this right: R. v. O'Connor, [1995], 4 S.C.R. 411.l9

For the purposes of the audit, the Ambiguity in source direction Committee examined a set of ran­ In one of the selected cases, the domly selected human source Committee found the Service's investigations. In addition, we officers seemed to be unnecessarily reviewed all requests from the indecisive about whether to advise a Service for Ministerial approval source to report a crime the person of and all requests to CSIS senior had information about to the au­ managers pertaining to operations thorities. The source thus received involving �sensitive institutions" or an ambiguous message concerning any operations dealing with lawful the commission of criminal acts by advocacy, protest and dissent. others. The Committee believes that the Service should have clearly eommittee findings counselled the source to report the information to the appropriate No attempt to influence sensitive authorities. institutions In none of the operations involving Senior management approvals for sensitive institutions that we examined operations did CSIS attempt to influence or direct Of note among the senior manage­ the activities of the organizations, and ment approvals for operations the source management in this regard was Committee examined were the in compliance with the most recent following: Ministerial Direction.20 In most of the cases, the sources' associations with The Service approved a request for a the respective organizations were not source to participate in a demon­ at the behest of the Service. stration that had the potential to

19. Department of Justice, Marct 1997.

20. Tte management of tuman sources, tteir participation in an organization's activities and tte impact of new Ministerial Direction is examined by tte eommittee in detail at page 10 of ttis report. SIRe Annual Report 1996 - 1997 Section 1: A Review of CSIS Intelligence Activities 25 become violent. The source had retained by CSIS in regard to threats little choice but to participate and to the security of Canada only to the the Service appropriately counselled extent that it is �strictly necessary." him on how to avoid violent inci­ The Committee found during its dents. examination of one of the audit cases that the Service was holding Three approvals granted dealt with information in a computerized data operations involving academic base that clearly did not fall into this institutions; one of these raised a category. The report at issue con­ ln none of the substantive issue. tained personal and sensitive operations information about a person who had Under Ministerial Direction - never been a CSIS target nor the involving sensitive since revised- any use of a source subject of an investigation, but institutions that on campus had to be approved by instead had been interviewed as a we examined did the Solicitor General. Under the potential source. procedure which obtained at the esls attempt to time, the Minister approved the use The Committee recommends influence or direct of a source on a particular campus. that source recruitment assessments involving per­ the activities of The Service subsequently directed a sons who are not targets not the organizations second source to attend the same be retained as part of the event under the initial approval. It is Service's section 12 data the Committee's view that the base. Service's action in this context was a clear contravention of the spirit of The Service informed us that it has the 1984 Ministerial Direction2! on taken corrective action. university campus investigations. The surveillance of Groups Retention of sensitive information and Persons on non-targets Section 12 of the CSIS Act stipu­ The Committee reviewed a sample lates that information can be of targets who were the subject of

Lawful Advocacy, Protest, Dissent and sensitive lnstitutions

Sensitive operations invariably involve the use and direction of human sources, and while human sources can be the most cost-efficient form of intelligence collection, their use also entails the greatest risk in terms of impact on societal institutions, legitimate dissent, and individual privacy. The CSISAActAspecifically prohibits the Service from investi- gating "lawful advocacy, protest or dissent" unless carried on in conjunction with threats to the security of Canada as defined in the Act. The Service is obligated to weigh with care the requirement for an investigation against its possible impact on the civil liberties of persons and sensitive institutions in Canada, including trade unions, the media, reli- gious institutions and university campuses.

21. See "Ministerial Direction" page 52.

SIRe Annual Report 1996 - 1997 26 Section 1: A Review of CSIS Intelligence Activites

surveillance coverage in fiscal year selective tasking for surveillance 1995­96. We examined the surveil­ and the Service's diminishing lance reports to determine whether resources had a negative effect on the surveillance, the quality of surveillance opera­ tions. • conformed to the requirements and restrictions set out by the Target lnterviews Within Particular Approval and Review Committee eommunities (TARC); . . . the eommittee Since 1990, CSIS has employed was satisfied to see • exceeded the �strictly necessary" community interviews regularly in provision of the CSIS Act, or other­ order to learn more about potential that esls regional wise unduly or unnecessarily in­ threats to Canada's security from the employees made fringed on a person's privacy; and spillover of overseas �homelands" considerable efforts conflicts into Canada. The • complied with Ministerial Direction interviews also serve to sensitize to understand and the CSIS Operational Policy ethnic communities about the aims the homelands Manual. of the Service and its role in protect­ conflicts. . . ing the security of Canada and eommittee findings Canadians. In the region the Com­ mittee audited for this report, three Our review of selected cases indicates programs to interview leaders of that the Service complied with all communities or interest groups were policies and procedures for carrying underway. out surveillance operations and conducted them in an appropriate As in past audits of community manner. There were no occasions interviews, the Committee's concern where emergency requests for surveil­ was to determine whether the lance were made in the Region we interviews were conducted in a audited. proper manner. Specifically, were they properly authorized; was the Quality of surveillance with reduced information collected and retained resources only that which was �strictly neces­ Surveillance is a resource­intensive sary"; and was the scope of the activity. In the region we reviewed, interview program appropriately the Committee did not find that the defined.

esls and the Use of surveillance

CSIS uses surveillance to learn about the behaviour patterns, associations, move- ments, and "trade-craft" of groups or persons targeted for investigation. As an inves- tigative tool, surveillance is used to detect espionage, terrorism, or other threats to national security. Large amounts of personal information can be collected and re- tained in the course of surveillance operations. The Service's surveillance units use various techniques to gather information. In an emergency, surveillance can be used before a targeting authority has been obtained.

SIRe Annual Report 1996 - 1997 Section 1: A Review of CSIS Intelligence Activities 27

In general, the Committee was particular community interview satisfied to see that CSIS regional program. employees made considerable efforts to understand the homelands Interview program II conflicts figuring prominently in the The second community interview current interview programs. As part program revealed an apolitical of the preparatory work, the investi­ community which, while concerned gators reviewed background reports about the unfolding events overseas, from other Government of Canada did not manifest a potential for departments. violence in Canada. The Regional office noted that during the period of Findings of the eommittee the interviews, a foreign mission in Canada tried to apply subtle influence Interview program I on the community to refrain from The Service considers this commu­ political involvement in the home nity interview program to have country. been the most successful and the Committee concurs. To date, neither The Committee noted that CSIS CSIS nor SIRC have received a interviewed relatively few people and The eommittee saw single complaint relating to the that the investigators appeared to be interviews conducted. respectful of those they spoke to; we no evidence that saw no evidence of the collection of the service collected The Committee saw no evidence that inappropriate information. inappropriate the Service collected inappropriate personal information about those The interview program was termi­ personal information persons interviewed. It retained only nated after six months - a decision about those what was �strictly necessary" to the Committee believes was valid persons advise the government. Investigators considering the paucity of reason­ asked questions regarding the poten­ able grounds to suspect a threat to interviewed tial for violence or foreign influence in national security arising from the the ethnic community and the impact ethnic community in Canada. of Canada's military role in the conflict. Interview program III The Committee identified no The Service's Regional office noted difficulties with the few interviews that there had been isolated inci­ conducted in this program, but did dents of inter­ethnic community take issue with the fact that the harassment by what it termed �hot investigation was set in motion in heads" during the period under the first instance. review, but stressed that there was no trend to widespread or serious The targeting authorization referred violence. With regards to foreign to information from foreign services embassy interference, the Service to the effect that overseas extremists observed none of consequence. might have taken root in Canada. This prompted CSIS to develop the The Committee believes that as the community interview program. The overseas conflict winds down, we would expect to see the end of this

SIRe Annual Report 1996 - 1997 28 Section 1: A Review of CSIS Intelligence Activites

Committee saw no evidence in the The Committee recommends documents to sustain that premise. that the definition of commu­ nity interview programs be The Service has acknowledged that clearly set out in CSIS policy. while it was unaware of any extrem­ ists or their supporters in Canada at In a related policy matter which the time, threats of violence from remains unresolved, the Committee extremists overseas remained a recommended in its last audit that concern, as did a potential indirect the Service update its Operational The eommittee did threat to Canadians living overseas. Policy Manual to include an existing take issue with the The Committee noted, however, that memorandum on procedures for the content of interviews focused on community interviews. We have fact that the investi­ what was happening in Canada, not seen no corporate policy revisions in gation was set in on the events taking place abroad. this area to date. motion in the first In any event, the investigation failed e. lnside esls instance. to corroborate the original informa­ tion or to identify possible affiliates The third part of this section of extremist organizations in Canada. dealing directly with what CSIS The Service subsequently elected to does and how it does it, consists of allow the investigation to conclude the Committee's comments and upon the expiry of the targeting findings on how the Service authority and stated that it would manages its own affairs and its monitor any future developments relations with other agencies of related to the threat via its other Government and other national investigations. governments.

Development of written policies for statistics on Operational community interviews Activities The Committee is pleased to note that the Service acted on a By law, the Committee is obliged to previous SIRC recommendation and compile and analyse statistics on the The eommittee elaborated a policy which would operational activities of the Service. remains concerned compel investigators to inform interviewees that their cooperation Annually, the Service provides the about the ambiguity is voluntary. Committee with statistics in a number evident in the of areas: warrants, sensitive opera­ definition of what As in previous years, the Commit­ tions, finances, person­year usage and constitutes a com­ tee remains concerned about the the like. We compare them against the ambiguity evident in the definition data from previous years and question munity interview of what constitutes a community CSIS about any anomalies or new program interview program. The correspon­ trends that we identify. dence that CSIS sent us to explain the issue was helpful, and we believe the Service should consider adding the information to its policy.

SIRe Annual Report 1996 - 1997 Section 1: A Review of CSIS Intelligence Activities 29

New classification system In addition, the new categories sever undermines eommittee the statistical measures of investiga­ analysis tions from readily identifiable targets, and because the titles are no longer In 1996­97 we learned that the standard, they make multi­year Service modified its statistical comparisons impossible. collection categories in the counter intelligence area. Under the old The Committee, therefore, has asked system, the categories were mainly CSIS to provide us with all of geographically based, and as such the statistical data by standard were readily linked to identifiable geographic, in addition to the new targets. Under the new system, the thematic, classifications. . . . many of the new statistics are subsumed under definitions were �themes" - economic espionage, Warrants and warrant statistics political espionage, military espio­ unhelpfully vague nage, foreign intelligence, prolifera­ Collecting and evaluating information and effectively tion, and foreign interference. on warrants is viewed by the undermined our Committee as an important task. ability to compile CSIS stated that the modifications Warrants are one of the most powerful were due, in part, to efforts to and intrusive tools in the hands of any and analyse respond better to Cabinet Direction. branch of the Government of Canada; However, the Committee found that for this reason alone their use bears many of the new definitions were continued scrutiny. In addition, the unhelpfully vague and effectively kinds of warrants granted and the undermined our ability to compile nature of the targets listed provide and analyse the necessary statistics. insight into the entire breadth of CSIS investigative activities and are an For example, under the new system, a important indicator of the Service's foreign intelligence service that uses a view of its priorities. source to obtain information from an elected official might fall under Table 1 compares the number of �political espionage." warrants over three fiscal years.

SIRe Annual Report 1996 - 1997 30 Section 1: A Review of CSIS Intelligence Activites

In 1996­97, the number of new Service must follow in their execu­ warrants rose dramatically to 125, a tion. In 1995­96, there were a substantial increase attributable to the number of revisions and additions restructuring of the warrants.22 The to the conditions attached to CSIS Service drew up affidavits requesting warrants. The Federal Court made warrant powers in additional areas of one amendment and added two investigation, resulting in the Federal restrictions on how the Service can Court granting a number of new execute warrants in one type of warrants. In addition, Federal Court warrant, and narrowed the manner in warrants are now required for new which the Service is able to execute types of inquiry. warrant powers in another. Finally, three new conditions were laid down The number of persons affected by by the Federal Court which served CSIS warrant powers has increased to restrict certain types of warrants. slightly because of the addition of the new areas of investigation. As we noted in the section on Foreign nationals Foreign nationals continue to warrant implementation, the Com­ continue to constitute the majority of persons mittee continues to monitor changes constitute the subject to warrant powers. in warrants and the powers associ­ ated with them. majority Regulations of persons subject Under section 28 of the CSIS Act, esls Finances to warrant powers the Governor in Council may issue regulations concerning how the On an annual basis, the Service Service may apply for warrants. In provides the Committee with basic fiscal year 1996­97, no new regula­ information on CSIS funding, and tions were issued. over the course of the year, we also examine any funding problems that Federal court warrant come to our attention. conditions All warrants granted by the Federal Table 2 shows spending by CSIS Court contain conditions which the over the last six years:

22. In our 1995-96 Annual Report, we pointed out ttat warrant statistics do not reflect tow many persons are affected by warrant powers. One warrant can involve many people, wtile several warrants may not mean an increase in tte number of people affected.

23. Main Estimates, 1997-98

SIRe Annual Report 1996 - 1997 Section 1: A Review of CSIS Intelligence Activities 31

�Other Expenditures" includes Although public security remains expenses under �Construction and the Service's main focus, the Acquisition of Land, Buildings and Branch has had to respond to Works", and �Machinery and government­wide fiscal restraint and Equipment." Significant amounts budget reductions. were expended to upgrade CSIS Many of the world's computers. In 1997­98, for the first According to CSIS, proposals for terrorist groups time, CSIS will pay $2.4 million to restructuring the Branch were have a presence Public Works and Government approved by the Service's Executive Services Canada for grants to in November 1996. The proposals in eanada, where municipalities in lieu of the pay­ were consistent with the ongoing they engage in ment of property taxes. The amount effort to make the structure of the a variety was formerly paid out of the Branch more efficient and to ensure Department of Public Works that the maximum number of of activities in budget. resources are directly employed in support of addressing the terrorist threat to the terrorist movements CSIS has been subject to significant security of Canada. budgetary cutbacks. In the course of the year, the Committee asked for The modifications in structure and and received a special briefing on operations were implemented in the effect of cutbacks on the ability May 1997; their impact on the of the Service to cope with rapid Service will be examined by the change. Committee in future audits. esls Operational Branches Threat assessments Originating primarily within the CT eounter Terrorism (eT) Branch branch, CSIS provides other depart­ ments and agencies in the Federal The Counter Terrorism Branch is Government with information about one of the Service's two main potential threats to national security investigatory sections (the other by issuing threat assessments. In being Counter Intelligence) and its 1996­97, the Service brought forth role is to provide the Government 540 threat assessments, down from of Canada with advice about emerging 602 produced the previous year. threats of serious violence that could affect the national security of Canada. CSIS stated that it could not at­ The threat from international terrorism tribute the decline to any specific continues to be associated with what are cause. The volume of threat assess­ termed �homeland" conflicts. As CSIS ments is contingent on a number of has pointed out, many of the world's factors beyond the Service's con­ terrorist groups have a presence in trol: the number of foreign visitors Canada, where they engage in a variety whose presence in Canada is cause of activities in support of terrorist for warning; the volume of requests movements.24 received from other government departments and agencies; and the Since our last annual report, there number of threats identified during have been no significant changes to the year. the Counter Terrorism program.

24. eSIS 1996 Public Report.

SIRe Annual Report 1996 - 1997 32 Section 1: A Review of CSIS Intelligence Activites

eounter lntelligence (el) Branch Analysis and Production (RAP) Branch Counter Intelligence Branch moni­ tors threats to national security The Service's research arm, the stemming from the espionage Analysis and Production Branch, activities of other national underwent a major reorganization in governments'intelligence operations. 1996­97. The goals of the reorgani­ By fiscal year 1996­97, the CI zation were two: to improve the Branch was no longer investigating coordination of intelligence produc­ many former adversaries and intelli­ tion with the Privy Council Office's gence services in what, since the end Intelligence Assessment Secretariat,27 of the Cold War, have become and enhance the intelligence support emerging democratic states. to the main consumers of its product inside the Service - the operational Instead, the Branch was pursuing a desks, the Executive, Security Liaison esls provides other strategy of encouraging such agencies to Officers, and the like. act with more �transparency." That is, in departments and its pursuit of liaison relationships with The Analysis and Production Branch agencies in the former and even current adversaries, the adopted a new structure with three Federal Government Branch has sought to find common divisions: one responsible for counter ground for cooperation and information intelligence and foreign intelligence with information 25 sharing. matters, a division that deals with about potential counter terrorism matters, and a threats to national In May 1996, Canadians learned division to prepare documents such about a Counter Intelligence Branch as the public annual report and the security by issuing success: the arrest of the Lambert classified annual report to the Solicitor threat assessments couple (Dmitry Olshevsky and Elena General. Olshevskaya). The Lamberts were trained �illegals" - spies who The Branch received no additional entered Canada illegally and as­ resources with which to operate. sumed false Canadian identities. The Strategic Analysis Unit was disbanded and its analysts integrated During 1996­97, the number of within the other units as �experts in intelligence officers in the Counter residence." A new unit was established Intelligence Branch rose slightly. to deal with foreign intelligence. The Service states that the Branch is focusing its resources on the areas of The Branch states that it is seeking to transnational crime, economic play a more proactive role by improv­ security, and issues surrounding the ing its dialogue with consumers of proliferation of weapons.26 Where foreign intelligence products and formal agreements are in place, the those who set the Government of Service has strengthened its liaison Canada's foreign intelligence require­ relationships with foreign agencies to ments. The Branch now employs a share information in these areas. standardized format for its reports, with a shorter turnaround time for production.

25. Tte Service's Foreign Liaison program is tte subject of a special report 27. Tte Intelligence Assessment Secretariat of tte Privy eouncil Office beginning on page 3. (PeO) produces foreign intelligence assessments. It coordinates tte interdepartmental activities and assessments of tte Intelligence Assessment eommittee, ctaired by tte Executive Director, wtose memberstip is 26. Tte Service's efforts in regard to ttreats to eanada's economic security composed of senior officials from tte departments and agencies most are subject of a special report at page 11. concerned witt intelligence matters.

SIRe Annual Report 1996 - 1997 Section 1: A Review of CSIS Intelligence Activities 33

The Analysis and Production Arrangements for 1996-97 Branch has become more involved The Service signed no new agree­ in �environmental scanning" ments with domestic agencies in activities. Using publicly available fiscal year 1996­97 and stated that all information, the Branch analyses of its current agreements were foreign disputes to assess the working well. In the course of our potential of these conflicts to review of CSIS operations the impact on Canadian interests. Committee identified no significant concerns with regard to domestic Arrangements with Other agreements. Departments and Governments An agreement which expired in 1994 has not yet been renewed and no Domestic arrangements consultations to accomplish its renewal were held during the audit In carrying out its mandate, CSIS period. However, cooperation cooperates with police forces, and between the Service and the agen­ federal and provincial departments cies covered by the previous agree­ and agencies across Canada. As ment has continued without diffi­ outlined earlier in this year's audit culty, with the approval of the report, 28 the Service may conclude Minister. cooperation agreements with domes­ tic agencies after having received the lnformation exchanged with approval of the Minister. Usually, other domestic agencies the agreements pertain to exchanges of information, and less frequently, Annually, the Committee reviews to collaboration in the conduct of the information CSIS exchanges operations or investigations. with other bodies in Canada in order to ensure that the Service is collect­ Currently, CSIS has twenty­four ing and disclosing information in arrangements with Federal Govern­ conformity with the CSIS Act, ment departments and agencies, and Ministerial Direction and Service eight agreements with the prov­ policy.29 In particular, we review The service may inces. CSIS also has a separate whether, conclude cooperation arrangement with several police agreements with forces in one province. The Service • the threat is balanced against the is not required to enter into a formal infringement on personal privacy domestic agencies arrangement in order to pass informa­ resulting from the passage of after having received tion or cooperate on an operational information; the approval of the level with domestic agencies, though Ministerial approval for such contacts • the exchange of information is Minister is required. It is the usual practice for strictly necessary to meet the the Service to enter into a formal Service's operational requirements arrangement when the other party pursuant to section 12 of the CSIS requires terms of reference or the Act; setting out of agreed undertakings.

28. See Section 1, "Annual Audit of a Region" discussion of Ministerial 29. Under tte CSIS Act, tte Service is to cooperate witt federal and provincial approval for intra-government cooperation. departments and agencies (section 17), and disclose information [section 19(2)1 "for tte purpose of tte performance of its duties and functions." Operational cooperation witt otter government institutions includes tte exctanges of information, tte provision of operational assistance, and can include tte execution of joint operations. Section 38(a)(iii) of tte CSIS Act states ttat tte eommittee tas a duty, "to review tte arrangements entered into by tte Service pursuant to subsections 13(2) and (3), and 17(1) and to monitor tte provision of information and intelligence pursuant to ttose arrangements."

SIRe Annual Report 1996 - 1997 34 Section 1: A Review of CSIS Intelligence Activites

• the information exchanged consists reports into the Service's operational of unnecessarily personal and (section 12) data base. However, on sensitive information, such as review of the reports' contents, the medical or welfare records; Committee questioned both the relevance of the reports to threats to • the information exchanged is reason­ the security of Canada and the able, and factually accurate; necessity for the Service to collect them in order to fulfill its role in • all CSIS disclosures of information advising the government. are in accordance with the preamble to subsection 19(2) or paragraphs The Committee notified the Service The eommittee 19(2)(a) to (d); and of its concerns, following which, questioned both the CSIS agreed to delete three of the • the information that CSIS provides four reports. CSIS believes that the relevance of the is within the mandate of the agency remaining report contains section 12 reports to threats to receiving it. information. The Committee re­ the security of mains of the view that the outstand­ Methodology of the audit ing report should also be removed eanada and the For calender year 1995, the Commit­ from the operational data base, since necessity for the tee examined approximately 5,000 the activities reported upon are not service to collect exchanges of information with other related to a Service investigation. government institutions, such as the them police, federal and provincial depart­ In regard to the collection and ments and agencies. All disclosures retention of information of this made under section 19 of the CSIS type generally, the Committee Act were also reviewed. We con­ believes that existing Service policy ducted on­site reviews in two re­ does not provide comprehensive gional offices in order to assess the guidance to its officers. status of cooperation between CSIS and other agencies in those regions. We recommend, therefore, that the Service review and Findings of the Committee set out policy which ad­ We found that the majority of the dresses gaps in current CSIS exchanges of information in policy pertaining to informa­ 1995 were within policy parameters tion exchanges with police and statutory requirements. Several agencies in relation to issues, however, require comment. advocacy, protest, and dissent. Collection of information on advocacy The Committe will continue to The nature of a set of reports a monitor the situation. regional police force gave to CSIS, and the Service's subsequent han­ Clarification of separate mandates dling of them, gave rise to Commit­ In the course of its investigations, tee concerns. The reports commented the Service interviewed managers in on a series of events that involved two government departments. On public advocacy or protest. The reviewing the files on this matter, Service had deposited all of the the Committee was not able to

SIRe Annual Report 1996 - 1997 Section 1: A Review of CSIS Intelligence Activities 35 determine whether the interviews is designated as the point of contact had an operational (section 12 of between the agencies. the CSIS Act) or security screening­ related (section 15) purpose. In In its review, the Committee response, the Service stated that its became aware of a case where CSIS policies did delineate between these by­passed the designated person and types of investigations; the communicated directly with another Committee's view differs and our employee of the department, thus-in concerns remain. the view of the Committee-contra­ We found that the vening the agreement. The Service majority of the The CSIS Act clearly defines two is of another view generally about esls exchanges kinds of investigatory powers for such agreements, in that it regards the Service, each with its own array designated persons as facilitators of information in 1995 of managerial and legal tests and who may be used in the liaison role, were within policy controls. The Committee believes but who are not the only persons parameters and that any blurring of intent between CSIS can approach for information. these two quite separate functions statutory wherein information collected with The Committee regards its own requirements one stated purpose is used for interpretation as the correct one. another, raises concerns about the Where the Service has reached a taking of administrative �shortcuts" formal agreement covering and invasion of privacy. section 12 investigations with a government department or agency We recommend, therefore, - the main purpose of which is to that the Service take the set out terms and conditions govern­ necessary measures to ing the relationship - the Service is ensure that section 12 and obliged to comply strictly with the section 15 investigations are terms of that arrangement. clearly distinguishable, and, where they may of necessity Non-compliance with requirements overlap, ensure that all the for accessing personal information applicable tests and controls In order for the Service to access are in place. personal information acquired by a Federal Government department or Our recommendation is directed at agency, the Service is required to CSIS practice, rather than policy. file a request through section 8(2)(e) The Committee intends to pay of the Privacy Act. The Committee continued special attention to has identified three cases where, in this issue. our opinion, CSIS did not comply with the Act. Non-compliance with an informa- tion exchange agreement In one case, the Service did not Under a written agreement with a agree with the Committee's view particular Federal Government that the information at issue was department the Service has access personal in nature. The Committee to certain information acquired by continues to hold to its original the department. Under the agree­ position. ment, an official of the department

SIRe Annual Report 1996 - 1997 36 Section 1: A Review of CSIS Intelligence Activites

In respect of the other two cases, tee should be notified when they the Service stated that while the are made. Under the new policy, information was personal in nature, the Director of CSIS will now it did not originate as a government report all disclosures made in the record and thus was not subject to national interest (special disclo­ the requirements of the Privacy sures) to the Committee. Act. The Committee's review of the information led us to conclude lnternational arrangements differently: the opinions collected by the Service were in our view Pursuant to section 17(b) of the based on information acquired in the CSIS Act, the Service must obtain government workplace, and the the approval of the Solicitor Service should have filed an infor­ General - after consultation with mation request in these cases as well. the Minister of Foreign Affairs and International Trade - before Policy and direction entering into an arrangement with In 1995, there was no new Ministe­ the government of a foreign state rial Direction related to domestic or an international organization. agreements and cooperation or During the exploratory and negoti­ exchanges of information ating phase leading to an agree­ . ment, no classified information is There were two changes to CSIS exchanged. policy with implications for inter­ agency cooperation. In the first, the Arrangements for 1996-9730 The Director of Service issued written policy on As of 31 March 1997, the Service operational cooperation with other had a total of 203 arrangements esls will now Canadian government institutions. with 123 countries and three report all The policy formalizes current international organizations. During disclosures made practice and thus does not call for the year, the Minister approved comment from the Committee. one new arrangement with a in the national foreign agency in Asia and three interest (special The second policy issued, responds existing arrangements were disclosures) to to a recommendation in the expanded. Two of the three Committee's 1992­93 report, which agencies' predecessor organiza­ the eommittee. addressed the issue of �special tions (both in countries on the disclosures" by the Service. As a same continent) had poor human general principle, the Service is rights records; the revised agree­ restricted as to whom it may ments will allow for consultation disclose information. CSIS may and technical assistance. make special disclosures to persons outside of government, at the Information about transnational request of the Solicitor General. crime A number of intelligence agencies At the time, the Committee recom­ abroad collect information about mended that special disclosures trans­national crime. One of the meet the same test as disclosures functions of CSIS Security Liaison made under section 19(2)(d) of Officers posted abroad is to the CSIS Act; that is, the Commit­ develop and maintain the inter­

30. Tte broad scope of tte Service's foreign liaison and cooperation activities are subject of a special audit report in Section 1, page 3.

SIRe Annual Report 1996 - 1997 Section 1: A Review of CSIS Intelligence Activities 37 agency relations required to eommittee findings facilitate the exchange of this information.3! In turn, the Service The Committee noted several new passes the information on to the developments regarding both policy appropriate law enforcement and operational matters with respect authorities in Canada. to section 16 (foreign intelligence) operations within the Service. eollection of Foreign lntelligence At the policy level, CSIS published in 1995­96 a new chapter in the Foreign intelligence is information CSIS Operational Policy Manual concerning the �capabilities, formalizing existing procedures. intentions or activities" of a foreign state. Under section 16 of the CSIS In an operational matter, CSIS has Act, the Service may, at the written established a new system for request of the Minister of Foreign handling foreign intelligence Affairs and International Trade or reports. This new mechanism does the Minister of National Defence, not materially change the collect foreign intelligence. Committee's ability to track the The eommittee manner and extent to which CSIS Methodology of the audit retains foreign intelligence. employs various methods to audit The Committee employs various Inappropriate use and retention of the collection of methods to audit the collection of identifying information foreign intelligence: Two cases drew special attention foreign from the Committee. In the first, intelligence • as required by section 16 of the the Service sought and obtained CSIS Act, we examine Ministers' from the Communications Security requests for assistance; Establishment information that identified a person or organization • we review all information about without sufficient explanation of Canadians retained by CSIS for why it required the information. national security purposes; In the second case, we identified an • pursuant to the �strictly necessary" instance where information about a requirement of section 12 of the prominent individual's involvement CSIS Act, we assess whether CSIS in a morally questionable activity has a valid reason to retain informa­ had been retained - improperly, in tion from section 16 operations; the Committee's view. We believe that the retention of the identifying • in general terms, we assess whether information in this case was not the Service's cooperation with the �strictly necessary," given the Communications Security Estab­ potential detriment to the person. lishment (CSE) 32 complies with the CSIS Act.

31. For more on eSIS Security Liaison Officers see, page 3. 32. Tte eommunications Security Establistment is an agency of tte Department of Defence. As described by tte Auditor General in tis 1996 report to Parliament, The Canadian Intelligence Community, tte eSE, "analyses and reports on intercepted foreign radio, radar and otter electronic emissions... and provides ttis foreign intelligence to eanadian government clients." SIRe Annual Report 1996 - 1997 38 Section 1: A Review of CSIS Intelligence Activites

We recommend that CSIS Archives Requirements Unit (NARU) clarify its policy in regard to in CSIS reviews the files for disposi­ the �strictly necessary" tion. The staff in NARU decide requirement when assessing whether to keep the file, destroy it, or whether to retain identifying send it to the National Archives' information from foreign holdings. intelligence in the Service's computerized data base. During fiscal year 1996­97, NARU reviewed 12,495 files. Of these, Stale-dated ministerial requests 8,565 were destroyed, the Service In last year's report, the Committee retained 3,896 files, and 34 will be noted that a number of standing sent to National Archives once the requests for assistance from Minis­ retention dates are reached. This is ters were three or more years old, far lower than last year's 115,000 and had not been signed by the then files processed by the Unit, a The eommittee current Ministers. The Ministers decrease owing to the final disposal subsequently signed the requests. in the year previous of the remainder constantly monitors of approximately half a million files the service's file Management, Retention and inherited from the Royal Canadian Disposition of Files management Mounted Police in 1984. policies and Files are the essential currency of New File statistics practices intelligence gathering. Every CSIS investigation and every approved Comparing new file statistics for target requires the creation of a file, 1995­96 and 1996­97 highlights and a system for making the informa­ two interesting trends: tion in it available to appropriate officers in the Service. Balanced • major decreases in the files on against this information gathering foreign nationals visiting Canada, apparatus is the clear restriction on the where there was a counter intelli­ Service set out in the CSIS Act, that it gence concern; and shall collect information �to the extent that it is strictly necessary." The • increases in the number of files on Committee constantly monitors the screening, particularly in the catego­ Service's file management policies and ries of citizenship, immigration and practices to help ensure that no refugees. unnecessary information is improperly retained or distributed. The Committee is cautious about drawing too much from these obser­ File disposition vations. A decrease or increase in the number of files does not, of itself, CSIS files are held according to pre­ presage a change in the threats to determined schedules that define how national security. It may instead long they must be retained after represent variations in individuals' Service employees cease using them. memberships or group affiliations, or When this period expires, the National alternatively reflect the Service's focus on the most dangerous elements in some groups.

SIRe Annual Report 1996 - 1997 Section 1: A Review of CSIS Intelligence Activities 39 esls retention of internal that we encounter in the course of E-mail our reviews. We will continue to monitor the situation. One continuing area of concern for the Committee has been the man­ lnternal security agement of the Service's E­mail system. In the past, CSIS, like most In the 1994­95 SIRC Annual large organizations, relied almost Report, we reported on the case of exclusively on hard copy, paper­ Aldrich Ames, a Central Intelli­ based files. This was helpful to the gence Agency employee arrested for Committee's research and audit spying for the Soviet Union. On 16 activities in that all written commu­ November 1996, a second Central nications within CSIS could be Intelligence Agency employee, found in these files, including Harold James Nicholson, was internal memoranda and notes arrested for spying on behalf of pertaining to operations. Russia. Like Ames, Nicholson's motivation was financial. It does Recently, however, the Service has not appear that he obtained or converted its information manage­ betrayed information that can be One continuing ment system to a �paperless" considered injurious to Canada's area of concern for electronic one which automatically national security. the eommittee retains formal communications within CSIS (thus retaining it for As a result of the Ames case, CSIS has been the audit) but does not do so for �infor­ undertook a review of its own management of mal" correspondence. internal security practices. The the service's Committee received the final report Early in the new system's imple­ of that review, Finding the Balance, E­ mail system mentation period, the Committee in October 1996. noted a relative dearth of E­mail notes (the equivalent of the old The Service's report concluded that, hardcopy internal memoranda) �CSIS maintains sound and effec­ normal to most operations. We tive security practices," and under­ subsequently learned that for the lined the view that security proce­ informal E­mail notes to be retained dures must be balanced against the required a decision by each CSIS rights of CSIS employees. The officer on whether to �save" the report recommends a number of correspondence. Indeed, CSIS staff changes in the areas of security were alerted to the fact that any­ clearances for CSIS staff, as well as thing they saved would be subject enhanced security awareness to review. programs, and increased physical security. In addition, the report CSIS has since revised its instruc­ recommends that CSIS employees tions to employees; the new proce­ be required to disclose financial dures appear to facilitate saving the information on hiring, and be E­mail that should be placed in the subject to polygraph testing on a corporate record. The Committee periodic basis. has since noted a gradual increase in the volume of operational E­mail

SIRe Annual Report 1996 - 1997 40 Section 1: A Review of CSIS Intelligence Activites

The implementation of new proce­ trainees were conversions from dures for vetting security clearances other positions within the Service. for external contractors, and random searches of staff and visitors was also The female to male recruitment recommended. The Committee ratio was seventeen females to understands that as of the time of thirteen males, a change from last release of this report, most of the year's ratio of ten to twenty­ two. . . . there is little recommendations have been The representation of visible empirical evidence adopted. minorities was one male and three females. for concluding eommittee comments on that there is value matters of internal security All students met the bilingualism in the increased criteria. It is the Committee's view that use of the employee awareness of security Representation of eanadian polygraph in issues and knowledge of proper population in the service employment procedures is at least as important as designing new procedures. We The Committee believes that the screening noted that the report deferred employee complement of CSIS extensive comment on the control should be broadly representative of and handling of classified docu­ Canada's population. Over the past ments and instead recommended several years, we observed some that a study be conducted. CSIS progress in the Service's recruit­ informs us that the study has since ment of certain groups, but much been undertaken. remains to be done.

We also believe there is little empirical The Service made the most evidence for concluding that there is progress in meeting its objectives value in the increased use of the poly­ for the employment of visible graph in employment screening. The minorities. CSIS has also made The eommittee Committee continues to hold to the some advances in employing opinion expressed in previous reports Aboriginal peoples and persons believes that that a rigorous program of security with disabilities, although the the employee checks would probably be more effec­ Service did not meet the objectives complement of tive. it had set for itself. CSIS states that the under­representation of esls should be Personnel Recruitment and Aboriginal groups is a phenom­ broadly Representation Within enon of the Public Service at large representative esls and results, in part, from a high of eanada's resignation rate. Although CSIS achieved its objective for employ­ Recruitment of personnel population ing persons with disabilities in 1994, the two subsequent years The Service held two Intelligence have been less successful. Officer (IO) Entry Training Courses for fiscal year 1996­97 CSIS exceeded its objectives for with a total of thirty participants. placing women in the management All but one recruit successfully category positions in 1995, and in completed the course. Five of the

SIRe Annual Report 1996 - 1997 Section 1: A Review of CSIS Intelligence Activities 41 the senior intelligence officer levels in 1996. Since then, how­ ever, representation of women has declined both because of resigna­ tions, and reductions in numbers of positions in management categories where women were fairly well represented. Similarly, the Committee has noted the fact that cutbacks in CSIS staff levels have had their greatest impact on the women employees in the Administration category.

SIRe Annual Report 1996 - 1997 42 Section 2: Investigation of Complaints

Section 2: rights matters, and organized crime. Investigation of • As set out in the CSIS Act, any eomplaints person may lodge a complaint with the Review Committee, �with respect to any act or thing done by the Service." Quite distinct from its function to audit and review the Service's Section A below sets out the intelligence activities, SIRC's Committee's analysis of the second primary role is to investigate numbers and types of complaints complaints from the public about received during the 1996­97 fiscal any CSIS action. There are three year. discrete areas within the Committee's purview:33 Section B reviews CSIS' role in conducting security screenings and • The Committee is constituted as a assessments on behalf of the quasi­judicial tribunal to consider government. and report on any matter having to do with federal security clear­ A. 1996­97 eomplaints ances, including complaints about About esls Activities denials of clearances to govern­ ment employees or contractors. statistics

• The Committee investigates During the 1996­97 fiscal year, we reports made by Ministers about received thirty­three new com­ persons in relation to citizenship plaints under section 41 of the and immigration, certain human CSIS Act (�any act or thing") and

slRe's Role Regarding eomplaints About esls Activities

The Review Committee, under the provisions of section 41 of the CSISAAct, must investigate complaints made by "any person" with respect to "any act or thing done by the Service." Before the Committee investigates, however, two conditions must be met:

the complainant must have first complained to the Director of CSIS, and have not received a response within a period of time that the Committee considers reasonable, (approximately thirty days) or the complainant must be dissatisfied with the Director's response; and

the Committee must be satisfied that the complaint is not trivial, frivolous, vexatious or made in bad faith.

Furthermore, under subsection 41(2), the Committee cannot investigate a complaint that can be channelled through another grievance procedure under the CSISAAct or the PublicAServiceAStaffARelationsAAct. These conditions do not diminish the Committee's ability to investigate cases and make findings and recommendations where individuals feel that they have not had their complaints answered satisfactorily by CSIS.

33. Tte CSIS Act stipulates ttat SIRe conduct investigations pursuant to complaints made to tte eommittee under sections 41 and 42. Tte Act also states ttat SIRe can conduct investigations in regard to reports or matters referred to tte eommittee pursuant to section 17.1 of tte Citizenship Act, sections 39 and 82.1 of tte Immigration Act and Section 36.1 of tte Canadian Human Rights Act.

SIRe Annual Report 1996 - 1997 Section 2: Investigation of Complaints 43

one under section 42 (denial of found nothing unreasonable about security clearance). In addition, the CSIS activities in relation to these Committee received two ministe­ five cases and that assurance was rial reports - one pertaining to the conveyed to the complainants. Citizenship Act, the other to the lf we find that the Immigration Act. Ten complaints were received service has about which the Committee took performed its Findings on 1996­97 no action, apart from advising the complaints "with respect complainants that in failing first to duties and func­ to any act or thing" take the complaint to the Service tions efficiently directly, they had not met the and properly, we During fiscal year 1996­97, we requirements necessary for SIRC to received five complaints from investigate further. Six other then convey that persons who asserted that the complainants were informed that assurance to the Service had subjected them to the Committee did not have complainant surveillance, kidnapped them, jurisdiction to investigate their censored their mail or telephone particular cases. service, or medically implanted devices in them. For the second consecutive year, we received nine complaints with respect In response to complaints, the to the Service's activities in providing Committee as a general rule neither security assessments and!or advice to confirms nor denies that the person the Minister of Citizenship and Immi­ complaining is a target. The gration Canada. In four cases, the Committee thoroughly investigates Committee was able to confirm that the the complainant's assertions in Service had concluded its enquiries and order to ensure that the Service has had forwarded, or was about to for­ not used its powers unreasonably. ward, its recommendations to Citizen­ If we find that the Service has ship and Immigration Canada (CIC). In performed its duties and functions two other complaints, the Committee efficiently and properly, we then ruled that the complexity of the cases convey that assurance to the justified the time taken by CSIS to complainant. The Committee process the assessments.

SIRe Annual Report 1996 - 1997 44 Section 2: Investigation of Complaints

The Evolution of the security elearance eomplaints Procedure

The Committee has been constituted as a complaint tribunal to consider and report on any matter having to do with federal security clearances. Under section 42 of the CSISAAct, a complaint can be made to the Committee by:

a person refused federal employment because a security clearance has been denied;

a federal employee who is dismissed, demoted or transferred, or denied a promotion or transfer for the same reason; and

anyone refused a contract to supply goods and services to the government for the same reason.

This quasi-judicial role as a complaint tribunal is of immediate interest to individuals who have their security clear- ances denied and are adversely affected in their employment with the Federal Government as a result. Of course, an individual cannot complain about the denial of a security clearance unless such a decision has been made known. In the past, there was often no requirement that the individual be so informed. The Act remedies this by requiring deputy heads or the Minister to inform the persons concerned.

Until the CSISAAct was promulgated, not only were many individuals unaware that they had been denied a security clearance, but even those who were informed were often not told why their applications had been denied. Now, the law requires the Committee to give each individual who registers a complaint as much information about the circum- stances giving rise to the denial of a security clearance as is consistent with the requirements of national security. The Committee must then examine all facts pertinent to the case, make a judgement as to the validity of the decision taken by the deputy head, and then make its recommendations to the Minister and the deputy head concerned.

In another two cases, the Committee clearances was directed at a found that the delays took place in department that performs its own departments other than the Service, security screening investigations. and where the Committee has no The Committee was informed by jurisdiction. In respect of the final the department concerned that it complaint, we informed the com­ had not in fact revoked or sus­ plainant of the requirement to first pended the security clearance of submit his complaint to the Director the complainant, and we were of the Service. At the time of assured that the complainant publication of this report, the continued to hold a valid security complainant had written to the clearance. Given the fact that the Director. He was dissatisfied with investigating agency was other than the Service's response and had the Service, additional inquiries again filed with the Committee. were beyond the Committee's jurisdiction. Findings on 1996-97 security clearance complaints

The single complaint received by the Committee regarding security

SIRe Annual Report 1996 - 1997 Section 2: Investigation of Complaints 45

ehanges to Procedures in Respect of the Governor in eouncil

When the Committee receives a Ministerial Report, it investigates the grounds on which the report is based, then submits a full report to the Governor in Council. In the case of an application for citizenship, the Governor in Council may issue a declaration to prevent the approval of any citizenship application for a two-year period. In regards to immigration applications, the Governor in Council may direct the Minister of Citizenship and Immigration Canada to issue a security certificate against a person and to proceed with the deportation of that individual. During fiscal year 1996-97, the Minister of Citizenship and Immigration Canada introduced Bill C-84 in Parliament to amend the Citizenshi AAct and the ImmigrationAAct. The amendments allow the Governor in Council to appoint a judge to replace the Committee, in the event that we are of the opinion that we cannot fulfill our mandate. The Bill contains an interim provision to cover court decisions that were rendered before the Bill came into effect.

Findings on 1996-97 Persons appearing before the Ministerial reports34 Immigration Appeal Division 37 During 1996­97 the Committee Citizenship refusals received one such report. In this In our annual report last year, the case, the Immigration Appeal Committee stated that it had Division is unable to begin its received one Ministerial report review until the Governor in pursuant to this section. At that Council has made a decision on time, SIRC's jurisdiction to the Committee's report. investigate the matter was success­ fully challenged in the Federal The Committee will be revisiting a Court, where it was held that there case first heard by our late Chair­ was a reasonable apprehension that man. He had determined that the the Committee would subject of the complaint came be biased in its investigation of within the class of persons de­ the Ministerial report concerning scribed within paragraph 19(1)(g) the citizenship application of of the Immigration Act as �persons Mr. Ernst Zindel.35 The Govern­ who there are reasonable grounds ment launched an appeal to the to believe...are members of...an Federal Court. organization that is likely to engage in...acts of violence" that Deportation orders 36 would or might endanger the lives The Committee received no or safety of persons in Canada, and Ministerial Reports of this type thus are not admissible to Canada. during 1996­97.

34. Tte Minister of eitizenstip and Immigration eanada may make a report received and considered by ttem, ttat a permanent resident is a person to tte eommittee wten tte Minister is of tte opinion ttat a person stould not described in tte inadmissible classes of tte Immigration Act. See tte be granted citizenstip because ttere are reasonable grounds to believe ttat Immigration Act (section 39 onward). tte person will engage in an activity ttat constitutes a ttreat to tte security of 37. A report signed by tte Minister of eitizenstip and Immigration eanada eanada, or ttat tte person's activity is part of a pattern of criminal activity and tte Solicitor General may be issued to tte eommittee wten bott Ministers punistable by way of indictment. See tte Citizenship Act (section 19.1 are of tte opinion, based on security or criminal intelligence reports received onward). and considered by ttem, ttat a person wto tas lodged an appeal (against a 35. Ztndel v. Minister of eitizenstip and Immigration eanada, Federal eourt deportation order) before tte Appeal Division is a permanent resident of eanada, Decision of Mr. Justice Heald, 1 August 1996. described in tte inadmissible classes of tte Immigration Act. See Immigration Act [section 81(1) onward1. 36. A joint report signed by tte Minister of eitizenstip and Immigration eanada and tte Solicitor General may be issued to tte eommittee wten bott Ministers are of tte opinion, based on security or criminal intelligence reports SIRe Annual Report 1996 - 1997 46 Section 2: Investigation of Complaints

The Federal Court of Canada • departments and agencies of the subsequently ruled, however, that Federal Government (section 13 a portion of this same paragraph of the Act); 19(1)(g) contravened the freedom of association assured by paragraph • the government of a foreign state 2(d) of the Charter of Rights and (section 13 of the Act); and Freedoms in a manner that is not demonstrably justified in a free and • the Minister of Citizenship and democratic society. Immigration Canada respecting citizenship and immigration The Committee has subsequently matters (section 14 of the Act). been asked to determine whether the subject of the report, a perma­ The Service conducts security nent resident of Canada, is a person screening investigations and described in paragraphs 19(1)(e), provides security assessments for 19(1)(g), and 27(1)(c) of the employees of the Public Service, as Immigration Act as they existed on well as persons in the private sector 29 May 1992, and that portion of who receive government contracts paragraph 19(1)(g) of the Immigra­ that involve classified work.39 The most fre­ tion Act that remains in force and quently requested was not disputed by the Federal The requirements of a security Court judgement. assessment can vary, depending on security checks the clearance level requested cover the person's A member of the Review Commit­ (confidential, secret, top secret). life for a period of tee will re­examine the matter The most frequently requested during the course of 1997­98. security checks cover the person's ten years prior to life for a period of ten years prior the application eanadian Human Rights to the application (five years in the eommission referrals 38 case of access to secure govern­ ment premises) or back to age The Committee received no sixteen, whichever comes first. referrals of this type for the year under review. While it is the departments con­ cerned that conduct initial criminal and credit checks, the Service B. security screening cross­checks its own data base and Procedures within the conducts field investigations Government of eanada required (and interviews if neces­ sary) for Level 3 clearances or �for esls' role in security cause." assessments

Pursuant to section 15 of the CSIS Act, the Service may conduct investigations in order to provide security assessments to:

38. Wten, at any stage after tte filing of a complaint, and prior to tte (ReMP) wtict conduct tteir own field investigations for employees requiring commencement of a tearing before a Human Rigtts Tribunal, tte security clearances. eommission receives written notice from a Minister of tte erown ttat tte practice to wtict tte complaint relates was based on considerations relating to tte security of eanada, tte eommission may refer tte matter to tte Review eommittee. See section 45 (2) of tte Canadian Human Rights Act. 39. Tte two exceptions are tte employees of tte Department of National Defence (DND) and tte Royal eanadian Mounted Police

SIRe Annual Report 1996 - 1997 Section 2: Investigation of Complaints 47

security screening in the Government of eanada

The Government Security Policy (GSP)40 stipulates two types of personnel screening: a reliability assessment and a security assessment. Reliability checks and security assessments are conditions of employment under the Public ServiceAEm loymentAActA (PSEA).

Basic Reliability Status Every department and agency of the Federal Government has the responsibility to decide the type of personnel screening it requires. These decisions are based on the sensitivity of the information and the nature of the assets to which access is sought. Reliability screening at the "minimum" level is required for those persons who are appointed or assigned to a position for six months or more in the Public Service, or for those persons who are under contract with the Federal Government for more than six months, and who have regular access to government premises. Those persons who are granted reliability status at the basic level are permitted access to only non-sensitive information (information which is not classified or designated).

Enhanced Reliability Status Enhanced Reliability Status is required when the duties of a Federal Government position or contract require the person to have access to classified information or government assets, regardless of the duration of the assignment. Persons granted enhanced reliability status can access the designated information and assets on a "need-to-know" basis.

The Federal departments and agencies are responsible for determining what checks are sufficient in regard to per- sonal data, educational and professional qualifications, and employment history. Departments can also decide to conduct a criminal records name check (CRNC).

When conducting the reliability assessments, the Federal Government organizations are expected to make fair and objective evaluations that respect the rights of the individual. The GSP specifies that "individuals must be given an opportunity to explain adverse information before a decision is reached. Unless the information is exemptible under the PrivacyAAct, individuals must be given the reasons why they have been denied reliability status."

Security Assessments The CSISAActAdefines a security assessment as an appraisal of a person's loyalty to Canada and, so far as it relates thereto, the reliability of that individual. A "basic" or "enhanced" reliability status must be authorized by the govern- ment department or agency prior to requesting a security assessment.4l Even if a person has been administratively granted the reliability status, that individual must not be appointed to a position that requires access to classified information and assets, until the security clearance has been completed.

40. Treasury Board of eanada, Security Manual, Government Security Policy, etapter 2-4, "Personnel Security Standard."

41. For contracts, tte requirement to grant a basic or entanced reliability cteck prior to requesting a security assessment does not apply.

SIRe Annual Report 1996 - 1997 48 Section 2: Investigation of Complaints

statistics the subjects of the requests, the breakdown in new requests be­ In fiscal year 1996­97, the Service tween �indeterminate employees" completed 1,135 field investigations and �contract employees" is and subject interviews. The unknown. There were 28,319 Service's average response times to requests for access to government process security clearances during sites. 1996­97 were 14, 23, and 10142 days . . .one of the respectively, for Government For the majority of requests, the 43 Service's security assessment takes key innovations Security Policy levels I, II, III. the form of a simple notice of of the CSIS Act While the Service does not make assessment to departments. In fiscal was to require security assessment recommenda­ year 1996­97, CSIS issued 63,594 tions for DND and the RCMP, on notices. that the person request it can conduct checks of its subject to the indices on behalf of the two agen­ Right of redress and right of review request be cies in order to assist in their As noted earlier in the description security clearance investigations. of the procedures in place for informed Also at the request of DND and handling security clearance com­ should the RCMP, the Service can seek the plaints (see inset page 44) one of application for assistance of foreign agencies. the key innovations of the CSIS Act was to require that the person clearance be eommittee findings subject to the request be informed denied should the application for clearance Rising numbers of security be denied. The Committee contin­ screening requests ues to monitor the redress and The Committee notes with some review procedures. surprise that despite government downsizing, the number of govern­ Government employees46 who wish ment security screening requests to challenge a negative decision has increased in each of the last may do so through current griev­ three years: 51,209 in 1994­95, ance procedures in accordance with 56,886 in 1995­96, and 63,605 for sections 91 and 92 of the Public fiscal year 1996­97. While some of Service Staff Relations Act. When these requests were to update44 or a department denies a security upgrade45 existing security clear­ clearance to external candidates ances, 35,440 were new applica­ and government employees, the tions. In contrast, the number of Committee can review the matter; requests to downgrade clearances that is, a �right of review" is was minimal (68) for the same year. available to those affected. The procedure is also available to those Because of the manner in which the persons who contract directly with Service retains information about the government, and who are denied a security clearance by a deputy head.

42. In previous years, tte response times for tte Airport program were included asking tte Service to reassess tte security clearance "for cause." For tte year in tte Level 1 clearances; tence tte reason for tte apparent increase in processing under review, tte Service tas processed 7,401 requests for updates. days from previous years. Tte average processing time for tte "Airport 45. For tte year under review, tte Service processed 2,946 requests for Restricted Access Program and Accreditation" is one day. upgrades. Upgrade requests are processed wten tte new duties or tasks of a 43. GSP Levels: I (eonfidential), II (Secret), III (Top Secret). person require ttat tte individual tave a tigter level of screening ttan previously. 44. Departments must update an individual's entanced reliability status, Level I and Level II security clearances once every ten years. Site access security 46. Persons from outside tte Public Service (applicants and contractors), can clearances also must be updated every ten years. A Level III security clearance complain to tte eanadian Human Rigtts eommission, tte Public Service must be updated every five years. Of course, ttis regular update term does not eommission's Investigations Directorate, or tte Federal eourt, depending on preclude tte department from reviewing a person's reliability status or from tte particulars of eact case.

SIRe Annual Report 1996 - 1997 Section 2: Investigation of Complaints 49

Of the 63,605 government security may or may not have been taken by screening requests that CSIS Federal Government departments processed in fiscal year 1996­97, on the basis of CSIS information ten were �information briefs�47 and briefs. one was a �rejection brief"- the latter recommending denial of an The Committee's mandate does individual's security clearance. As allow us to ask the Service whether of June 1997, that person had not the departments concerned had The eommittee submitted the matter to the Com­ endorsed the Service's recommen­ mittee. dations. CSIS replied that in two of is concerned by the three cases, the departments the outcome of A similar pattern emerges when had indeed acted on its recommen­ these and other examining statistics for the previ­ dations. In the third, the Committee ous year. In 1995­96, CSIS re­ was informed that the recommen­ similar cases . . . ceived 56,886 requests for security dation to deny the clearance was clearances. Of those, the Service never acted upon because the issued thirty­nine information department chose not to hire the briefs and three rejection briefs. individual. Again, none of the individuals involved applied to the Committee The Committee is concerned by the for a review of the decision. outcome of these and other similar cases in light of the clear intent of The Committee's jurisdiction is Government Security Policy when limited to evaluating activities it comes to the individual's right to and recommendations of CSIS. redress and review. Thus, in the absence of a com­ plaint by the affected party, SIRC In instances where a security remains unaware of decisions that clearance is explicitly denied, the Committee notes that section 42(1)

security elearance Decisions � Loyalty and Reliability

Decisions by Federal departments to grant or deny security clearances are based primarily on the Service's recom- mendations. Reporting to the Federal organization making the request, CSIS renders an opinion about the subject's "loyalty" to Canada, as well as the individual's "reliability" as it relates to loyalty. Government Security Policy stipulates that a person can be denied a security clearance if there are reasonable grounds to believe that, "As it relates to loyalty, the individual is engaged, or may engage, in activities that constitute a threat to the security of Canada within the meaning of the CSISAAct." "As it relates to reliability, because of personal beliefs, features of character, association with persons or groups considered a security threat, or family or other close ties to persons living in oppressive or hostile countries, the individual may act or may be induced to act in a way that constitutes a 'threat to the security of Canada' or they may disclose, may be induced to disclose or may cause to be disclosed in an unauthorized way, classified information."

47. An "information brief" sets out security concerns about tte subject ttat do not meet tte criteria for outrigtt rejection. As suct, an information brief is not a recommendation for tte rejection of a clearance.

SIRe Annual Report 1996 - 1997 50 Section 2: Investigation of Complaints

of the CSIS Act stipulates that it is consults the Minister of Foreign the deputy head of a Federal Gov­ Affairs and International Trade. ernment department or agency who CSIS does not provide foreign is responsible for informing employ­ agencies with recommendations ees of the denial of a security concerning the suitability of a clearance. And we are also aware person to obtain a foreign security that it is Government policy to clearance. inform the persons refused of their right of redress. In 1996­97, the Service received 806 foreign screening requests, Nevertheless, the apparent dearth of and, among these, CSIS conducted recommendations for denial (1 out 160 field investigations. The of 63,605) and information briefs Service gave foreign clients 25 issued by CSIS, as well as the lack information briefs. of information about what depart­ ments do with the information from Advice to the Minister of the Service where no denial was Citizenship and Immigration recommended, will be the subject of The Committee learned that the future inquiries by the Committee. �Citizenship Security Flag System" referred to in past annual reports - Extended processing periods effectively a mechanism which Another issue arising from the three allowed the Service to alert the 1995­96 cases concerns the amount Department of Citizenship and of time the Service took to provide Immigration in advance about certain individuals - is no longer esls may the concerned departments with briefs: 26, 27, and 36 months, in operation. The program provided enter into an respectively. The Committee consid­ Citizenship and Immigration arrangement ers such lengthy periods to be Canada with the names and bio­ with the excessive, particularly in the case graphical data of permanent where the Service required three residents about whom the Service government years to respond to a request from a had identified security concerns. of a foreign new applicant for a government Identification by CSIS in this state, a foreign position. We are aware, however, manner was cause for the govern­ that delays may be caused by ment to closely examine the agency, or an circumstances beyond the Service's individual's applications for international control. citizenship. organization Security assessments for Since 1 January 1997, Citizenship foreign states and Immigration Canada employs a CSIS may enter into an arrangement mail­in reporting system whereby with the government of a foreign all applications are processed by a state, a foreign agency, or an inter­ Case Processing Centre in Sydney, national organization, to provide Nova Scotia. Names of prospective security assessments on Canadians citizenship applicants are sent from and foreign nationals. The Service the Centre to the Service, then must receive the approval of the checked against the Service's Solicitor General who, in turn, security screening information

SIRe Annual Report 1996 - 1997 Section 2: Investigation of Complaints 51 system data base. Most applica­ tions are processed in an expedi­ tious manner; the balance requiring additional analysis by the Service are retained and assessed before the Service provides a recommendation to the citizenship authorities.

In 1996­97, the Service received 142,317 applications from Citizen­ ship and Immigration, including 7,779 requests under the Refugee Determination Program, and 91,873 applications for citizenship. Of the citizenship applications, all but 39 were processed by 30 March 1997.48

The Service completed 50,444 immigration requests in fiscal year 1996­97. Fifty percent of these cases were processed in under 42 days. The average response time for the remaining requests was 177 days. The Service rendered its advice for over 99 percent of all cases in less than one year.

Sub�ect of a forthcoming review In order to better understand the �client­service" relationship between CSIS and the government bodies responsible for citizenship and immigration, the Committee will conduct an in­depth review of CSIS' role. The cooperation of Citizenship and Immigration Canada, the RCMP and immigra­ tion legal counsel outside of government, will be essential for the completion of this study.

48. Resolution is still pending for an additional eigtteen citizenstip applications teld over from previous years.

SIRe Annual Report 1996 - 1997 52 Section 3: CSIS Accountability Structure

Section 3: eSIS Direction or lack of compliance with Direction that may lead to improper Accountability behaviour or violations of the CSIS Act. Three areas specifically play a Structure role in the Committee's analysis: an examination of instructions issued by the Service based on Ministerial The Service is an agency of the Direction; a review of the manner in Government of Canada and as such, which Directions were implemented is accountable to government, Parlia­ in specific cases; and the identifica­ ment and the people of Canada. tion of significant changes in the Because of the serious and potentially numbers of operations that require There are a number intrusive nature of CSIS activities, the Ministerial approval. mechanisms set out in law to effect of independently that accountability are both rigorous In 1996­97 three new Ministerial managed systems and multi­dimensional; there are a Directions were brought to our inside and outside number of independently managed attention. systems inside and outside the Service the service for for monitoring CSIS activities and National Requirements monitoring esls ensuring that they accord with its Cabinet periodically provides activities and ensur­ mandate. general direction to CSIS about where it should focus its investiga­ ing that they accord It is part of the Security Intelligence tive efforts in the form of National with its mandate Review Committee's task (the Com­ Requirements from the Minister. A mittee itself being part of the account­ recent Direction, National Require­ ability structure) to assess and com­ ments for 1995­97, sets out priori­ ment on the functioning of the systems ties in five areas: counter terrorism, that hold the Service responsible to counter intelligence, security government and Parliament. screening,�foreign intelligence support" and �transnational criminal A. Operation of esls activity." Accountability Mechanisms The latter category represents a significant alteration of the previous Ministerial Direction requirements Direction issued in 1994­95 in that it instructs the Service The CSIS Act requires the Committee to provide government with strategic to review Direction provided by the assessments of transnational criminal Solicitor General to the Service under activity that may impact on the subsection 6(2) of the Act. Ministerial security of Canada. In a related issue, Direction governs certain types of CSIS was also directed to continue to CSIS investigations in potentially provide criminal intelligence to sensitive areas such as investigations Canadian law enforcement agencies on university campuses. One of the under the provisions of section 19 of Committee's major concerns is to the CSIS Act. identify the adequacy of Ministerial In past Committee audits, we have expressed concern about the tardy

SIRe Annual Report 1996 - 1997 Section 3: CSIS Accountability Structure 53 provision of Ministerial Direction on The Ministry informed us that a new National Requirements. The Direction Direction on the retention of open - in effect a planning document - source information is forthcoming. was not being issued before the end of the relevant year. The Minister elected Investigations on campus to issue the National Requirements in Previous Ministerial Direction for a Direction that covered two fiscal �Investigations on Campus" required years - 1995­96 and 1996­97. The the approval of the Solicitor General Committee notes that the National for all CSIS operations on campus Requirements for 1997­98 have been that could impact on the free flow of issued. ideas associated with academic institutions. New Ministerial Direc­ While the Committee was unable to tion reaffirms this principle, but states comment in last year's report on the that the Director of CSIS can on his National Requirements applicable to own approve source activities in that period because of their late specified circumstances, and must issuance, we have identified no report his decisions to the Minister. difficulties arising from that fact. In a previous audit report, the Com­ Information management mittee recommended that the Ministe­ The Ministerial Direction on �Informa­ rial Direction governing investigations tion Management" is intended to be a on campus be rewritten, and we note cumulative document, encompassing that the new Direction addresses ln a previous audit all previous Direction regarding the Committee concerns about the termi­ report, the Service's management, retention, and nology in the previous Direction not destruction of files. The Direction also being consistent with the CSIS Act. eommittee takes into consideration rapidly recommended that evolving information technologies. The Committee will monitor how the Service implements the new Direc­ the Ministerial Previous versions of the Information tion. Direction governing Management Direction from the investigations on Solicitor General specifically stated Activities to overthrow campus be that �open information which does not by violence meet the statutory tests for collection Pursuant to Ministerial Direction rewritten. . . or retention should in future be held by issued in 1988, the Minister must CSIS quite separately and apart from approve any investigation of threats investigative files." Upon review of falling under what is commonly the most recent Direction, the Com­ referred to as the �subversion� section mittee noted that it did not contain this of the CSIS Act - section 2(d), requirement. �activities directed toward...the destruction or overthrow by violence In response to our query, the Ministry of the constitutionally established of the Solicitor General informed the system of government in Canada." In Committee that the Direction omitted 1996­97, the Solicitor General autho­ the requirement in order to allow CSIS rized no investigations in this regard. time to discuss the policy and formu­ late its position on the issue.

SIRe Annual Report 1996 - 1997 54 Section 3: CSIS Accountability Structure

ehanges in service operational Disclosures of information in the policies and instructions to public and in the national interest officers Disclosures in the public interest Derived in part from the Service's Section 19 of the CSIS Act prohibits interpretation of Ministerial Direction, the Service from disclosing informa­ the CSIS Operational Policy Manual tion, except in specific circumstances. is intended as a guide and operational Under one circumstance, explicitly framework for CSIS officers and referred to in the Act, the Minister employees. The Committee examines can authorize the Service to disclose changes to the Operational Policy information in the �public interest." Manual as if they were changes to The Act compels the Director of CSIS Ministerial Direction, and regards the to submit a report to the Committee . . . we believe that manual as a useful tool in assisting our regarding all �public interest" disclo­ important policy reviews of CSIS investigations. sures; in 1996­97 there were none. instruments In fiscal year 1996­97, the Service Disclosures in the national interest such as these produced three new policies and Under the Service's interpretation of should be placed in several revisions: its mandate, it holds that acting as the Minister's agent, CSIS can also make the official policy • standardizing the format of threat special disclosures of information in manual more assessments; the �national interest."49 In such quickly circumstances, the Solicitor General • cooperating with the Department of would determine whether the disclo­ Citizenship and Immigration sure of operational information was in Canada; and fact in the national interest, where­ upon he would direct CSIS to release • obtaining premises for CSIS opera­ the information to persons or agencies tions. outside government.

In the course of the Committee's While the Committee was initially assessment of the new Ministerial concerned about the implications Direction on Information Manage­ of such special disclosures, a new ment, the Service referred to an CSIS policy stipulates that we will be internal policy document we had not informed whenever they take place. seen. Upon our request, CSIS pro­ The Committee will examine future vided the Committee with a copy of a special disclosures on a case by case �service wide" policy which had been basis. There were none during the in force since 1993. While the Com­ fiscal year 1996­97. mittee found nothing in the policy with which to take issue, we believe Governor in eouncil regulations that important policy instruments such and appointments as these should be placed in the official policy manual more quickly. Under section 8(4) of the CSIS Act, the Governor in Council may make regulations concerning appointments

49. On occasion, in tte course of its investigations, eSIS obtains information ttat does not fall wittin tte Service's mandate, but wtict stould be provided to tte proper auttorities as it is in tte public interest. Tte Solicitor General must decide if tte disclosure is essential to tte public interest, and wtetter ttis interest clearly outweigts any invasion of privacy ttat could result. Witt tte Minister's approval, eSIS may disclose ttis information to any Minister of tte erown or to a person in tte Public Service of eanada. See section 19(2)(d) of tte CSIS Act.

SIRe Annual Report 1996 - 1997 Section 3: CSIS Accountability Structure 55 and other personnel matters. No such countries operate �against Canadian regulations were issued in 1996­97. interests, within Canada or abroad." The Service was attempting to use Annual report of the Director the establishment of liaison rela­ of esls tions as an incentive to encourage foreign intelligence services to The CSIS Director's Annual Report to cease their intelligence activities in the Solicitor General (a top Canada. secret document) comments in some detail on the Service's operational • CSIS is becoming increasingly activities for the preceding fiscal year. involved in investigating The Committee has among its key transnational crime. functions, the task of reviewing this report. • To the end of March 1996, CSIS had decreased the average time This year, we comment on two annual required to process a �top secret" reports. In our audit report of clearance for a government em­ 1995­96, the Committee was unable to ployee or contractor from 113 days comment on the Director's report of to 84 days as a result of the imple­ that same fiscal year since we received mentation of a new automated his report past the point for publication system. in our Annual Report for that year. As a result, we describe both the 1995­96 • Fiscal year 1995­96 marked the and the 1996­97 reports from the establishment of a new program Director in this section. called the Refugee Watch List. This internal program identifies persons ln 1995­96, eounter Director's report for 199�-96 who are considered to be security In the view of the Committee, the threats and who may seek refugee lntelligence Branch salient points of the Director's An­ status or permanent residence in reported that some nual Report of 1995­96, were the Canada, or attempt to obtain a thirty countries following: sensitive position in the Federal Government. operate "against • The Director stated that public safety eanadian interests, remained the Service's principal The Committee has three comments within eanada or concern, and noted that the main about the Director's report: source of politically motivated abroad" violence is the �spillover of foreign First, we believe that where the conflicts into Canada" - a factor Minister is not otherwise informed reflected in the fact that almost two­ by the Service, the Director's Report thirds of all CSIS investigations in should explain the significant and 1995­96 were conducted by the substantial departures from past CSIS Counter Terrorism Branch of the practices and methods. If the reasons Service, rather than by Counter for the trends or changes are not Intelligence. apparent to us, we will seek explana­ tions from the Service and, if not • In 1995­96, Counter Intelligence satisfied, the Committee will investi­ Branch reported that some thirty gate further.

SIRe Annual Report 1996 - 1997 56 Section 3: CSIS Accountability Structure

Second, absent from the report are domestic extremism investigations. discussions of important issues con­ And second, the Director's report did cerning the Service's operations. For not provide an assessment of the example, the report does not address relationship between a certain state's issues surrounding the impact of hostile activities in Canada, and the technology on Service activities. impact on existing arrangements for cooperation with that country. Third, we found that the Annual Report was silent on the activities of eertificate of the lnspector the Analysis and Production Branch General 50 (RAP). RAP is an important opera­ tional branch and a major conduit for The CSIS Act [section 38(a)(i)] The Director could advice CSIS provides to the Federal directs the Committee to review the have provided more Government. It would be helpful if in Certificates issued by the Inspector future, the Director would report on General of CSIS. In his Certificate, information about such Analysis and Production Branch the Inspector General assesses the certain domestic activities as the quantity and types of Director's Annual Report and he also extremism investi­ intelligence reports it produces, conveys the findings from his audits requirements of the consumers of RAP of the Service's operational activities. gations information, and the feedback that The Certificate is based in large part RAP receives from them. CSIS says on the Inspector General's studies and that when required, information of this consultation reports. type can be conveyed to the Minister by other means. The Committee received the Inspector General's Certificate covering fiscal Director's report for 1996-97 year 1994­95 in October 1996. We In his 1996­97 Annual Report, the did not receive his Certificate for Director emphasized that Canada 1996 in time for review and publica­ faces profound, and not entirely tion in this Annual Report. positive changes in the global security environment; an environment that has The Inspector General commented become more unstable and unpredict­ that he was satisfied that the able in view of the fact that the activi­ Director's Annual Report (1994­95) ties arising from traditional threats �made a useful contribution to the have not gone away, and new types Solicitor General's appreciation of have emerged. CSIS operations and provided him with information of value in carrying We found that the Director's out his oversight role." But the 1996­97 Annual Report provides Inspector General's audit also found a a satisfactory overview of CSIS' most number of inaccuracies and unsub­ important investigative activities. We stantiated statements in the Director's also concluded, however, that the report. Service did not report, or did not report in sufficient detail, on two Inspector General's observations important areas. In his review of CSIS activities for 1994­95, the Inspector General made a First, the Director could have provided number of observations and recommen­ more information about certain dations to the Solicitor General.

50. See inset on page 19 for a description of tte role of tte Inspector General of eSIS.

SIRe Annual Report 1996 - 1997 Section 3: CSIS Accountability Structure 57

The Inspector General concluded that recommended that when the Service the Minister received insufficient brings cases to the Solicitor General for information from CSIS in the areas of a decision, it should be more explicit in section 16 operations, section 17 linking the circumstances of each case arrangements, and human source to the governing authorities and operations. relevant controls that apply.

He recommended that for issue­based Finally, the Inspector General objected targeting, the Service should take to a CSIS decision not to provide him special care to document the grounds with certain documents on the grounds on which it bases requests for autho­ that they were administrative in nature. rization to investigate.5! special reports of the lnspector The lnspector The Inspector General also suggested General General's audit also that CSIS clearly specify how pro­ found a number of posed joint operations with allied While the Inspector General's Certifi­ intelligence agencies fulfill the cate is his principal method of inaccuracies and statutory duties and functions of the reporting his findings, he may issue unsubstantiated Service. CSIS, with the Minister's special studies from time to time. We statements in the approval, sometimes runs intelligence were made aware of no special operations in Canada with the assis­ studies in 1996­97. Under section 40 Director's report tance of allied intelligence services. of the CSIS Act, the Committee can He added that the Solicitor General itself request the Inspector General to may wish to give CSIS guidance on conduct a special study or a review on when and how he should be informed our behalf. In 1996­97 we made no of the outcome of approved opera­ such requests. tions. Unlawful conduct The Inspector General recommended that CSIS clarify the nature and limits Under section 20(2) of the CSIS Act, of Security Liaison Officers (SLO ) the Director is to submit a report to duties abroad, and that the Solicitor the Minister when, in his opinion, a General should be informed before­ CSIS employee has acted unlawfully hand if any extraordinary measures by in the performance of his or her duties the SLOs are to be taken. (See page 3 and functions. The Minister, in turn, for a description and assessment of the must send the report with his com­ foreign liaison program, and the role of ments to the Attorney General of SLOs). Canada and to the Committee.

The Inspector General commented on In 1996­97, there were no cases of a number of other matters including, unlawful conduct reported to the the provision of warnings or advice to Attorney General or the Committee. the private sector, the Service's Of the 13 previous referrals to the transmittal of information to the Attorney General, all but two have Department of Foreign Affairs and been resolved. The two outstanding International Trade, and CSIS compli­ cases date back to 1989 and 1990, ance with warrant conditions regarding respectively. solicitor­client communications. He

51 As tte eommittee noted earlier, (page 17) issue-based targeting takes place wten eSIS investigates a particular sector, suct as economic espionage, ratter ttan groups or persons.

SIRe Annual Report 1996 - 1997 58 Section 3: CSIS Accountability Structure

slRe consultations and in�uiries Visiting dignitaries from other countries often ask to meet with As noted earlier, the Committee is a Members of the Review Committee. key part of the CSIS accountability In 1996­97, the Committee met with: structure. In 1996­97 we undertook specific activities in this respect in the • Australia's Inspector­General of following areas: Intelligence and Security, and Australia's High Commissioner to Formal inquiries Canada (August 1996); During the fiscal year (1 April 1996 ­ 31 March 1997), we directed 141 • staff from South Africa's Joint formal inquiries to the Service. This Standing Committee on Intelli­ number does not include inquiries gence (JSCI) and a security agency arising out of complaints. The average in that country (February 1997); time CSIS took to answer a formal and The eommittee inquiry was 44 days, a decrease from last year's average of 53 days. • Poland's Minister Responsible for Members met with Security, who was accompanied by officials from esls' �riefings two security chiefs (March 1997). Regional Headquar­ The newly­appointed Chair, Paule Gauthier, P.C., O.C., Q.C., met The Deputy Executive Director ters in order to keep with the Director of CSIS in Novem­ addressed a conference of security abreast of their ber 1996, and the Commissioner for officials from the North Atlantic operations and the Communications Security Estab­ Cooperation Council!Partners for lishment (CSE) in December 1996. Peace (NACC!PfP). Sponsored by the problems The Chair and Committee Members NATO Special Committee, the met with the Director of CSIS in May conference was held in Brussels in 1996, and in December 1996. These November 1996 and provided SIRC meetings are over and above the daily with a unique opportunity to share contact that our Research Staff has Canada's experience in reviewing the with the Service. operations of a domestic security intelligence agency with the Western The Committee Members met with powers and the emerging democra­ officials from CSIS' Regional Head­ cies. quarters in Vancouver, Halifax, Ottawa, Montreal, and Toronto in The Committee's Counsel!Senior order to keep abreast of their opera­ Complaints Officer attended a series tions and problems. of conferences sponsored by the Canadian Bar Association and the SIRC activities additional to CSIS Council of Canadian Administrative review Tribunals in Toronto, Hull, and The Committee met with the Inspector Vancouver. The conferences dealt General of CSIS in January 1997, and with administrative law and immigra­ the Coordinator of Security and tion issues. Intelligence in the Privy Council Office in February 1997.

SIRe Annual Report 1996 - 1997 Section 3: CSIS Accountability Structure 59

Special reports ment. Although it is the Minister Under section 54 of the CSIS Act, the who tables the Committee's report in Committee can issue special reports the House of Commons, he has no to the Solicitor General on any matter authority to edit or otherwise alter the relating to the performance and Committee's document. functions of the Service. In 1996­97, we submitted no studies of this kind The Committee was invited to appear to the Minister. (A list of all SIRC before the Sub­Committee on Na­ studies to date can be found in tional Security on 3 December 1996 Appendix B of this report.) to answer questions concerning its 1995­96 Annual Report. During this B. lnside the security appearance, the Chair stated that she lntelligence Review hoped that in future, �the relationship eommittee between the Sub­Committee and SIRC becomes one of mutual trust." In October 1996, the Honourable Paule Gauthier, P.C., O.C., Q.C. The Committee again appeared before was appointed as Chair of the Com­ the Sub­Committee on National mittee,52 and the Honourable James Security on 15 April 1997, to answer Andrews Grant, P.C., Q.C. was questions about the Although it is the appointed to replace her as a Member 1997­98 Main Estimates. Minister who tables of the Committee. staying in touch with eanadians the eommittee's Accounting to Parliament report in the House Research Staff attended the Intelli­ of eommons, he has The Committee appeared before the gence Studies Section at the annual Sub­Committee on National Security conference of the International no authority to edit on 15 May 1996 to respond to Studies Association (ISA), held in or otherwise alter questions about the Main Estimates Toronto in March 1997. They also the eommittee's for fiscal year 1996­97. participated in the conference and annual general meeting of the Cana­ document On 24 October 1996, the Solicitor dian Association for Security and General tabled the Committee's Intelligence Studies (CASIS) held at 1995­96 Annual Report in Parlia­ the same time.

52. Mme Gauttier tad been a Member of tte eommittee since 8 June 1995, and tad previously served from 1984 to 1991.

SIRe Annual Report 1996 - 1997 60 Section 3: CSIS Accountability Structure

SIRC on the internet Adapting to budget restraint To provide information about the Government­wide budget reductions Committee and its work to a wider at SIRC have had an impact on the audience, SIRC opened its official site Committee's activities. The investiga­ on the Internet in late October 1996 - tion of complaints is the most expen­ www.sirc­csars.gc.ca. To date, the sive area of discretionary spending Web site has been visited over eighty­ for the Committee, and must, there­ five thousand times. fore, bear the brunt of the budget cuts. To deal with the reductions, the Our Web site explains the mandate of Committee is doing more work in the Committee and provides informa­ house, and using outside lawyers less. tion on SIRC's activities, biographies While undertaking this and other of the Committee Members, full measures, the Committee is deter­ versions of recent annual reports, lists mined to avoid increasing the time of SIRC studies, recent changes to required to handle complaints, and to legislation that impact on the Commit­ maintain the quality of its reports. tee, and a search procedure to allow visitors to find information on specific The review area is also being affected subjects. by budget reductions. As with com­ plaints, more work is being done The site also informs the visitor about internally, and the Committee is how to file complaints to the Commit­ employing fewer contract research tee under sections 41 and 42 of the consultants. In addition, SIRC has CSIS Act, and has links to other reduced the funding for seminars. slRe opened its Internet sites we believe will be of Instead, we rely more on one­to­one official site on interest to visitors; among these are meetings with academics and other the lnternet in Parliament, the Privacy Commissioner, experts. and the Access to Information Com­ late October missioner. In 1997­98, the Committee will 1996 - increase its productivity by reassigning www.sirc­ lmpact of budget changes two positions from the General Admin­ istrative or support category to the csars.gc.ca. SIRC has reduced its spending levels Research section. This should increase since 1991­92, and will continue to do the Research section's output by one so over the next two fiscal years. third at minimal extra cost. Although the reductions have not been large in absolute terms, they are The Committee believes that all of significant for a small organization these steps combined, together with a with little budget flexibility. continuing effort to improve effi­ ciency, will allow SIRC to maintain Figure 1 understates the degree to which or improve the performance of its the Committee's budget has been responsibilities to Parliament and the reduced because commencing in 1995­ public at lower cost. 96, translation services ($50,000) are now included in SIRC's reference levels. Prior to 1995­96, these services were provided gratis through the Trans­ lation Bureau, Secretary of State.

SIRe Annual Report 1996 - 1997 Section 3: CSIS Accountability Structure 61

Personnel To recognize the contributions of the Senior Complaints Officer and the . . . all of these steps The Committee has a small total staff Committee's increased reliance on in­ combined, will allow of fourteen: an executive director, a house legal resources for handling counsel!senior complaints officer to complaints cases, Sylvia Mac�enzie slRe to maintain or handle complaints and ministerial was appointed as the Counsel and improve the perfor­ reports, a deputy executive director, a Senior Complaints Officer, effective mance of its respon­ director of research, a project leader, 1 April 1997. and five research officers, one of sibilities to Parlia­ whom is responsible for liaison with The Committee decides formally at its ment and the public the media, an administrative officer monthly meetings the research and at lower cost who is also the Committee registrar for other activities it wishes to pursue, and hearings, and an administrative support sets priorities for the staff. Day­to­day staff of three to handle the sensitive operations are delegated to the Execu­ and highly classified material using tive Director with direction when special security procedures. necessary from the Chair in her role as the Chief Executive Officer of the Reorganization and increased produc- organization. tivity Effective 1 April 1997, the Commit­ tee restructured its research function to use its resources more efficiently. The Committee has integrated all research resources under a deputy executive director to more closely mirror the current deployment of resources within CSIS, and to effectively manage the intensive research program.

SIRe Annual Report 1996 - 1997 62 Appendix A

GLOSSARY

ARAACP - Airport Restricted Area Access Clearance Program

CIC - Citizenship & Immigration Canada

CI - Counter Intelligence

COMMITTEE - Security Intelligence Review Committee (SIRC)

CSE - Communications Security Establishment

CSIS - Canadian Security Intelligence Service

CT - Counter Terrorism

DFAIT - Department of Foreign Affairs & International Trade

DIRECTOR - the Director of CSIS

GSP - Government Security Policy

HQ - Headquarters

IO - Intelligence Officer

MINISTER - the Solicitor General of Canada, unless otherwise stated

MOU - Memorandum of Understanding

NARU - National Archives Requirements Unit

NHQ - CSIS National Headquarters

RAP - Analysis and Production Branch

RDP - Refugee Determination Program

RTA - Request for Targeting Authority

SERVICE - Canadian Security Intelligence Service (CSIS)

SIGINT - Signals Intelligence

SIRC - Security Intelligence Review Committee

SLO - Security Liaison Officer

TARC - Target Approval and Review Committee

SIRe Annual Report 1996 - 1997 63 Appendix B

SIRe REPORTS AND STUDIES SINeE 1984

(Section 54 reports - special reports the Committee SIRC Report on CSIS Activities Regarding the Cana­ makes to the Minister - are indicated with an *) dian Peace Movement, June 1989 (540 pages!SE­ CRET) * (89!90­03) Eighteen Months After Separation: An Assessment of CSIS' Approach to Staffing Training and Related A Review of CSIS Policy and Practices Relating to Issues, April 14, 1986 (139 pages!SECRET) * Unauthorized Disclosure of Classified Information, (86!87­01) August 1989 (SECRET) (89!90­04)

Report on a Review of Security Screening for Report to the Solicitor General of Canada on Citizen­ Applicants and Employees of the Federal Public shiplThird Party Information, September 1989 (SE­ Service, May 1986 (SECRET) * (86!87­02) CRET) * (89!90­05)

The Security and Intelligence Network in the Govern­ Amending the CSIS Act: Proposals for the Special ment of Canada: A Description, January 1987 (61 Committee of the House of Commons, September pages!SECRET) * (86!87­03) 1989 (UNCLASSIFIED) (89!90­06)

Ottawa Airport Security Alert, February 1987 SIRC Report on the Innu Interview and the Native (SECRET) * (86!87­05) Extremism Investigation, November 1989 (SECRET) * (89!90­07) Report to the Solicitor General of Canada Concerning CSIS' Performance of its Functions, May 1987 Supplement to the Committee's Report on (SECRET) * (87!88­01) Immigration Screening of January 18, 1988, 15 November 1989 (SECRET) * (89!90­01) Closing the Gaps: Official Languages and Staff Relations in the CSIS, June 1987 (60 pages!UNCLAS­ A Review of the Counter­Intelligence Program in the SIFIED) * (86!87­04) CSIS, November 1989 (700 pages! TOP SECRET) * (89!90­08) Counter­Subversion: SIRC Staff Report, August 1987 (350 pages!SECRET) (87!88­02) Domestic Exchanges of Information, September 1990 (SECRET) * (90!91­03) SIRC Report on Immigration Screening, January 1988 (32 pages!SECRET) * (87!88­03) Section 2(d) Targets - A SIRC Study of the Counter­ Subversion Branch Residue, September 1990 (SE­ CSIS' Use of Its Investigative Powers with Respect to CRET) (90!91­06) the Labour Movement, March 1988 (18 pages! PUBLIC VERSION) * (87!88­04) Regional Studies (six studies relating to one region), October 1990 (TOP SECRET) (90!91­04) The Intelligence Assessment Branch: A SIRC Review of the Production Process, September 1988 (80 pages! Study of CSIS' Policy Branch, October 1990 (CONFI­ SECRET) * (88!89­01) DENTIAL) (90!91­09)

SIRC Review of the Counter­Terrorism Program in the Investigations, Source Tasking and Information CSIS, November 1988 (300 pages! TOP Reporting on 2(b) Targets, November 1990 (TOP SECRET) * (88!89­02) SECRET) (90!91­05)

Report to the Solicitor General of Canada on Protecting Release of Information to Foreign Agencies, January Scientific and Technological Assets in Canada: The 1991 (TOP SECRET) * (90!91­02) Role of CSIS, April 1989 (40 pages!SECRET) * (89!90­02)

SIRe Annual Report 1996 - 1997 64 Appendix B

CSIS Activities Regarding Native Canadians - A CSIS Activities during the Gulf War: Community SIRC Review, January 1991 (SECRET) * (90!91­07) Interviews, September 92 (SECRET) (90!91­12)

Security Investigations on University Campuses, Review of CSIS Investigation of a Latin American February 1991 (TOP SECRET) * (90!91­01) Illegal; a SIRC Review, November 92 (TOP SE­ CRET) * (90!91­10) Report on Multiple Targeting, February 1991 (SE­ CRET) (90!91­08) CSIS Activities in regard to the Destruction of Air India Flight 182 on June 23, 1985 - A SIRC Review, Review of the Investigation of Bull, Space Research November 92 (TOP SECRET) * (91!92­14) Corporation and Iraq, May 1991 (SECRET) (91!92­ 01) Prairie Region - Report on Targeting Authorizations (Chapter 1), November 92 (TOP SECRET) * (90!91­ Report on Al Mashat's Immigration to Canada, May 11) 1991 (SECRET) * (91!92­02) The Assault on Dr. Hassan Al­Turabi: A SIRC East Bloc Investigations, August 1991 (TOP SE­ Review of CSIS Activities, 25 May 93 (SECRET) CRET) (91!92­08) (92!93­07)

Review of CSIS Activities Regarding Sensitive Domestic Exchanges of Information (A SIRC Review Institutions, August 1991 (TOP SECRET) (91!92­10) - 1991l92), November 92 (SECRET) (91!92­16)

CSIS and the Association for New Canadians, October Prairie Region Audit, January 93 (TOP SECRET) (90! 1991 (SECRET) (91!92­03) 91­11)

Exchange of Information and Intelligence between the Sheik Rahman's Alleged Visit to Ottawa, May 1993 Canadian Security Intelligence Service & Canadian (SECRET) (CT 93­06) Security Establishment, October 1991 (TOP SE­ CRET) * (91!92­04) Regional Audit, September 1993 (TOP SECRET)

Victor Ostrovsky, October 1991 (TOP SECRET) (91! A SIRC Review of CSIS' SLO Posts (London & 92­05) Paris), September 1993 (SECRET) (91!92­11)

Report on Two Iraqis - Ministerial Certificate Case, The Asian Homeland Conflict, September 1993 November 1991 (SECRET) (91!92­06) (SECRET) (CT 93­03)

Threat Assessments, Section 40 Study, January 1992 Intelligence ­ Source Confidentiality, November 1993 (SECRET) * (91!92­07) (TOP SECRET) (CI 93­03)

The Attack on the Iranian Embassy in Ottawa, May Domestic Investigations (1), December 1993 1992 (TOP SECRET) * (92!93­01) (SECRET)(CT 93­02)

"STUDYNT" The Second CSIS Internal Security Domestic Investigations (2), December 1993 (TOP Case, May 92 (TOP SECRET) (91!92­15) SECRET) (CT 93­04)

Domestic Terrorism Targets - A SIRC Review, July Middle East Movements, December 1993 92 (TOP SECRET) * (90!91­13) (SECRET)(CT 93­01)

CSIS Activities with respect to Citizenship Security A Review of CSIS' SLO Posts (1992­93), December Screening, July 92 (SECRET) (91!92­12) 1993 (SECRET) (CT 93­05)

The Audit of Section 16 Investigations, September 92 Review of Traditional CI Threats, December 1993 (TOP SECRET) (91!92­18) (TOP SECRET) (CI 93­01)

SIRe Annual Report 1996 - 1997 65 Appendix B

Protecting Science, Technology and Economic Inter­ Visit of Boutros Boutros­Ghali to Canada, November ests, December 1993 (SECRET)(CI 93­04) 1995 (SECRET) (CI 94­04)

Domestic Exchanges of Information, December 1993 Review of Certain Foreign Intelligence Services, (SECRET) (CI 93­05) January 1996 (TOP SECRET) (CI 94­02)

Foreign Intelligence Service for Canada, January 1994 The Audit of Section 16 Investigations and Foreign (SECRET) (CI 93­06) Intelligence Reports, February 1996 (TOP SECRET)(CI 94­01) The Audit of Section 16 Investigations and Foreign Intelligence Reports, May 1994 (TOP SECRET) (CI Domestic Exchanges of Information (A SIRC Review 93­11) 1994­95), February 1996 (SECRET)(CI 94­03)

Sources in Government, June 1994 (TOP SECRET) Alleged Interference in a Trial, 27 February 1996 (CI 93­09) (SECRET) (CT 95­04)

Regional Audit, July 1994 (TOP SECRET) (CI 93­02) CSIS and a "Walk­In", March 1996 (TOP SECRET) (CI 95­04) The Proliferation Threat, December 1994 (SECRET) (CT 93­07) Investigation of a Foreign State's Intelligence Services, 28 October 1996 (TOP SECRET) (CI 95­02) The Heritage Front Affair. Report to the Solicitor General of Canada, December 1994 (SECRET) (CT The Audit of Section 16 Investigations and Foreign 94­02)* Intelligence Reports, 7 February 1997 (TOP SECRET) (CI 95­05) A Review of CSIS' SLO Posts (1993­94), January 1995 (SECRET) (CT 93­09) Regional Audit, 16 May 1997, (TOP SECRET) (CT 95­02) Domestic Exchanges of Information (A SIRC Review 1993­94), January 1995 (SECRET)(CI 93­08) A Review of Investigations of Emerging Threats, 20 June 1997 (TOP SECRET) (CI 95­03) The Proliferation Threat ­ Case Examination, January 1995 (SECRET) (CT 94­04) Domestic Exchanges of Information, 23 July 1997 (SECRET) (CI 95­01) Community Interviews, March 1995 (SECRET) (CT 93­11) Homeland Conflict, 13 August 1997 (TOP SECRET) (CT 96­01) An Ongoing Counter­Intelligence Investigation, May 1995 (TOP SECRET) (CI 93­07)*

Potential for Political Violence in a Region, June 1995 (SECRET) (CT 93­10)

A SIRC Review of CSIS' SLO Posts (1994­95), September 1995 (SECRET) (CT 95­01)

Regional Audit, October 1995 (TOP SECRET) (CI 93­ 10)

Terrorism and a Foreign Government, October 1995 (TOP SECRET) (CT 94­03)

SIRe Annual Report 1996 - 1997 66 Appendix C

LIST OF RECOMMENDATIONS

SECTION 1: A REVIEW OF CSIS INTELLIGENCE C. INSIDE CSIS ACTIVITIES We recommend, therefore, that the Service review A. AREAS OF SPECIAL INTEREST FOR 1996­97 and set out policy which addresses gaps in current policy pertaining to information exchanges with CSIS Liaison Program with Foreign Agencies police agencies in relation to advocacy, protest, and dissent. We recommend, therefore, that the Procedures Manual be brought up to date, and that it cover important post We recommend, therefore, that the Service take the issues that are not addressed elsewhere. necessary measures to ensure that section 12 and section 15 investigations are clearly distinguishable, We recommend, however, that when an SLO decides to and, where they may of necessity overlap, ensure that disclose adverse open information about Canadians to a all the applicable tests and controls are in place. foreign agency, the SLO be required to first consult with management at CSIS Headquarters. We recommend that CSIS clarify its policy in regard to the "strictly necessary" requirement when assess­ We recommend that the Service revise, or at least better ing whether to retain identifying information from define, its system of evaluating the reliability of foreign foreign intelligence in the Service's computerized agencies. data base.

Economic Espionage We recommend that administrative information col­ lected from the Liaison!Awareness Program be retained in a non­section 12 data base.

B. ANNUAL AUDIT OF CSIS ACTIVITIES IN A REGION OF CANADA

We believe that CSIS should obtain the Solicitor General's approval to exchange information with or otherwise cooperate with government departments and agencies with which it does not have formal arrange­ ments.

Consequently, the Committee recommends that unless there are specific operational considerations that preclude it, the Service should in future inform Federal departments concerned about the conclusions it has drawn about Federal employees investigated.

The Committee recommends that source recruitment assessments involving persons who are not targets not be retained as part of the Service's section 12 data base.

The Committee recommends that the definition of community interview programs be clearly set out in CSIS policy.

SIRe Annual Report 1996 - 1997 67 Appendix D

COMPLAINT CASE HISTORIES

This section describes complaint cases submitted A complaint in respect to an airport interview during the past year to the Committee under Section 41 of the CSIS Act, and concerning which the Committee As a result of our investigation, we were satisfied that had reached decisions. Not reviewed here are com­ the Service had not used its powers in an illegal or plaints that were the subject of administrative reviews inappropriate fashion when it had conducted an and the nine complaints about the length of time taken interview. We concluded that the interviewee partici­ by the Service to provide advice to the Department of pated voluntarily in the interview. Citizenship and Immigration Canada (CIC). A complaint about sharing information with Complaints about security screening interviews an employer

Interviews are one of the procedures employed by In 1995, a person was transferred to another unit CSIS to assess immigration and other applicants, and it within the organization that employed him - an is the view of the Committee that interviews conducted organization that shares information with CSIS. The by CSIS investigators can identify security related complainant asserted that he was told that he was concerns only if the interviews are conducted skillfully being transferred as a result of information that had and all possible security issues are discussed. come to the attention of his supervisor from the Service. CSIS personnel had attempted in previous Conducted appropriately, interviews can also provide years to interview the complainant and his refusal to applicants with the opportunity to address security be interviewed had left the Service with a negative issues. perception of the complainant.

Investigators who conduct the interviews do not make The Service maintained that it had never told the decisions about the status of applicants. A different employer that it would cease to share information if section in CSIS analyses the interviews, as well as the complainant remained in the unit, and, that in information from other sources, and the results are 1995, it had told the employer that it knew nothing to presented in the form of briefs to Citizenship and suggest that the complainant was a security risk or Immigration Canada (CIC). The ultimate decision to that he was anything other than a loyal Canadian. The grant or refuse an application is made by CIC. Service noted to the Committee that in its view, the matter of the job transfer within the other organiza­ The Committee received two complaints about alleged tion was beyond its purview. impropriety in regard to interviews conducted by CSIS investigators. While the Committee was cognizant of After examining the information provided by the the length of time that had lapsed before CIC requested Service to the employer, the Committee concluded the Service's advice, we made the complainants aware that the complaint was justified and that CSIS person­ of the fact that the Committee's jurisdiction when nel failed to disseminate the information in its posses­ assessing whether any undue delay has occurred is sion in an objective, responsible, and professional limited to the actions of CSIS alone. manner. The Service has the obligation not only to accurately observe and record the facts that it collects, We concluded that neither complaint was valid. In one it must also be fair and objective when it reports such case worthy of note, the complainant had alleged that information to others. an investigator demonstrated "personal bias" against him during an interview. We found that this allegation Except to the extent that CSIS may have influenced was not supported by the evidence. Instead, we the actions of the organization concerned, the observed that the investigator had adopted a profes­ Committee's jurisdiction does not encompass the sional and objective approach to the assignment. activities of the body for which the complainant

SIRe Annual Report 1996 - 1997 68 Appendix D worked. We have, however, recommended to the an analogy with a foreign agency whose mandate Service that it share in a clear and unreserved manner resembled the Service's in that it investigated politi­ with senior management in the complainant's organi­ cally motivated violence. zation, its conclusion that the complainant did not attempt to conceal intelligence activities and does not While the Committee regards the investigator's constitute a threat to the security of Canada. particular choice of words as unfortunate, we also are convinced, based on a reading of the entire exchange, A delicate balance that he well understood the overall mandate and purpose of the Service, and furthermore, that he The Committee reviewed a complaint about CSIS attempted to convey this information to the from a person whose status in Canada was undeter­ interviewee. mined. With respect to a statement made by the other This case drew the Committee's attention to the investigator involved, the Committee believes possibility that the Service could take unfair advantage that it is reasonable to expect more restraint and of persons who would prefer not to provide assistance professionalism from CSIS officers than was to CSIS, but who are concerned that failure to cooper­ illustrated in this instance. We acknowledge the ate would adversely affect their chances of obtaining fact that interviews are often an effective means residence in Canada. Of equal concern is the possibil­ of collecting information and intelligence, and that ity that persons approached by CSIS at an early stage a sometimes useful interview technique involves in the immigration process could come to believe that the employment of leading statements. their chances of securing status in Canada would be improved by cooperating. The Committee believes, however, that such techniques should never include statements that In this particular case, the Committee found the are not placed in the proper context, or adverse allega­ complaint justified. tions about groups or individuals that are not sup­ ported by the facts. Complaints about a C��� interview

To fulfill its duty to report to government on activities that may, on reasonable grounds, be suspected of constituting threats to the security of Canada, the Service depends on the information of members of the public who may have knowledge of, or opinions on, activities relating to threats to the security of Canada, including politically motivated violence � information often obtained through personal interviews.

The Committee investigated complaints concerning an interview conducted by the Service and recorded by the interviewee. While we were satisfied that the interview fell within the legislative mandate of the Service, two statements made by the investigators during the course of the interview caused some concern.

At one point in the interview, an investigator referred to CSIS as "the political police." The investigator told the Committee that it was the first time he had ever used the phrase and assured us that he would never use it again. He explained that he was attempting to draw

SIRe Annual Report 1996 - 1997