Date:
20130429
Docket:
T-1565-12
Citation:
2013 FC 443
Ottawa, Ontario,
April 29, 2013
PRESENT: The
Honourable Mr. Justice Rennie
BETWEEN:
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MAKSIM DHAMO
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Applicant
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and
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MINISTER OF PUBLIC
SAFETY AND EMERGENCY PREPAREDNESS
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Respondent
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REASONS FOR
JUDGMENT AND JUDGMENT
[1]
The
applicant seeks to set aside a decision by a delegate of the Minister of Public
Safety and Emergency Preparedness to retain seized currency pursuant to
paragraph 29(1)(c) of the Proceeds of Crime (Money Laundering) and Terrorist
Financing Act, SC 2000 c 17. For the reasons that follow the application
is dismissed.
Facts
[2]
On
June 3, 2010, the applicant was to fly from Pearson International Airport in Toronto to Albania. The applicant states that he was returning to Albania for work after visiting his family in Canada.
[3]
A
Canada Border Services Officer (the Officer) stopped the applicant and asked if
he was aware of the requirement to report currency of $10,000 or greater. The
applicant stated that he was aware of the requirement but denied having more
than $10,000 in his possession. A search revealed that he was carrying five
envelopes containing Canadian dollars, US dollars and Euros totalling
$11,818.28 Canadian.
[4]
The
Officer questioned the applicant regarding the source of the funds. The
applicant stated that the funds belonged to other people who were sending money
to Albania. The applicant stated that he owned an import and export company
for goods such as wine and food. He stated that he earned $5,000 per year from
that business and that he also had part-time work in Albania from which he
earned an additional $5,000 per year. However, he was unable to provided
details regarding either source of income when asked.
[5]
The
Officer seized the currency pursuant to subsection 18(1) of the Act
which provides that an Officer may do so if he believes on reasonable grounds
that a person has failed to report it. The Officer held the money with no
terms of release pursuant to subsection 18(2) of the Act because the
Officer suspected that the currency may be proceeds of crime.
[6]
The
applicant elected not to continue on the flight and instead remained at the
airport. The Officer provided the applicant with a seizure report and then
drafted a narrative report which was later given to the applicant.
[7]
The
narrative report provides the Officer’s basis for suspecting that the currency
was the proceeds of crime:
a. The applicant stated
he was aware of the requirement to report the currency but did not do so and
instead made false statements.
b.
He
was traveling to a drug source country.
c.
He
was travelling with funds in excess of his stated yearly income.
d. He stated that the
funds belonged to third parties, including Mr. Ciraku, an Albanian national.
However, he could not explain his relationship to Mr. Ciraku, Mr. Ciraku’s
source of income, why he left the money in Canada and why he did not carry the
money himself.
e.
He
had difficulty explaining his employment in Albania and the nature of his
import/export business.
f.
He
had made 14 trips since 2004, which was considered excessive for someone living
on his stated income.
[8]
The
applicant requested Ministerial review of the Officer’s decision and provided
written submissions and evidence through a number of letters.
[9]
The
applicant claimed that the seized currency belonged to three people. Mr. and
Mrs. Zaka were said to be sending $3,000 Canadian to Mrs. Zaka’s sister in Albania. Mrs. Sulejmani was said to be sending 1,000 Euros to her mother. Mr. Ciraku was
said to have closed his Canadian bank account and asked the applicant to bring
the funds ($2,360 Canadian and $4,987 American) to him.
[10]
The
applicant explained that he thought he did not have to report the currency
because he had only “a bit” more than $10,000.
[11]
The
Minister’s delegate decided that there had been a contravention of the Act and
that the currency would be forfeited because the applicant had not demonstrated
a legitimate source for all of the currency.
Statutory Framework
[12]
Subsection
12(1) of the Act provides that one must report to an officer the
importation or exportation of currency or monetary instruments equal to or
greater than the prescribed amount. Section 2 of the Cross-Border Currency
and Monetary Instruments Reporting Regulations, SOR/2002-412 provides that
the prescribed amount is $10,000.
[13]
Subsection
18(1) of the Act permits an officer to seize as forfeit the currency or
monetary instrument if the officer believes on reasonable grounds that there
has been a contravention of subsection 12(1).
[14]
Subsection
18(2) requires the officer to return the seized currency or monetary
instruments upon payment of a prescribed amount unless the officer has
reasonable grounds to suspect that it is proceeds of crime or funds for the use
in financing terrorist activities.
[15]
Section
25 allows a person from whom the currency or monetary instruments were seized
to request a Minister’s decision as to whether there was a contravention.
[16]
Under
section 29, if the Minister decides that subsection 12(1) was contravened, the
Minister may return the currency or monetary instruments or confirm that it be
forfeited. Notably, it is not possible for the Minister to grant partial
relief from forfeiture.
Analysis
Procedural
Fairness
[17]
The
applicant argues that there were three breaches of procedural fairness. In my
view, these arguments are without merit.
[18]
First,
the applicant submits that he should have been provided with an interpreter at
the time of the seizure. The argument has no foundation in the evidence.
[19]
The
narrative report demonstrates that the applicant was able to communicate in
English. He explained why he did not report the currency and provided an
explanation as to the source. He did not request an interpreter or otherwise
indicate that he had difficulty expressing himself.
[20]
Moreover,
the applicant had ample opportunity to provide clarifications in his
submissions to the Minister.
[21]
Second,
the applicant submits that the Minister breached procedural fairness by failing
to give notice to the affected third parties pursuant to paragraph 18(3)(c) of
the Act. The third parties provided evidence in support of his request
for a Ministerial decision. Therefore, any failure to provide notice did not
create unfairness for the applicant. If the third parties had any rights in
the proceeding, the applicant may not assert those rights on their behalf.
[22]
Third,
the applicant submits it was a breach of procedural fairness for the Minister
to fail to render a decision within the period of time stipulated in section 27
of the Act. It is true that there were substantial delays in this
case. However, as this Court found in Ha v Canada, 2006 FC 594, the
timeline provided in the Act is “directory only” and the Minister does
not lose jurisdiction by reason of delay. Here, as the applicant has not
demonstrated any prejudice resulting from the delay, there is no breach of
procedural fairness.
Reasonableness
[23]
The
applicant submits that his evidence establishes a legitimate source for the
seized currency and that the Minister set an impossibly high burden of proof.
[24]
In
these circumstances the burden on an applicant is substantial. He was required
to persuade the Minister that the funds are not proceeds of crime. The
Minister may ask for proof of a legitimate source for the funds and, if proof
is not forthcoming, the Minister may decline to relieve the applicant from
forfeiture. Throughout the process the applicant bears the evidentiary burden
and the Minister is not required to make inquiries or investigate: Sellathurai
v Canada (Minister of Public Safety and Emergency Preparedness), 2008 FCA
255, paras 50-51. This burden was explained to the applicant in correspondence
from the Recourse Directorate.
[25]
The
Act does not specify on what basis the Minister may relieve an applicant
from forfeiture. Therefore, there may be various reasonable approaches, so
long as the Minister’s discretion is exercised within the broad framework of
the legislation: Sellathurai, paras 38, 53. In this case, it was
reasonable for the Minister to confirm that the funds would be forfeited.
[26]
The
Minister accepted that the 1,000 Euros received from Mrs. Sulejmani originated
from a legitimate source, her employment income. However, the Minister was not
satisfied with regards to the remaining funds.
[27]
The
applicant stated that Mr. Ciraku had earned the income in Albania prior to 1999 from his rental properties and electrical company. Mr. Ciraku is
said to have travelled to Canada in 1999 and deposited cash into a Canadian
bank account. He then returned to Albania and left the Canadian bank account
dormant. Then, in 2010, pursuant to a power of attorney executed by Mr. Ciraku
in favour of the applicant, the applicant transferred the funds to his bank
account and withdrew the funds in cash. The applicant said that he was
bringing the cash to Mr. Ciraku in Albania.
[28]
The
documentation established Mr. Ciraku’s business activities in Albania, the transfer of funds from Mr. Ciraku’s account to the applicant’s account and the
cash withdrawal. However, the paper trail does not begin until the transfer of
funds between bank accounts; there was no documentary evidence that the money
in Mr. Ciraku’s account originated from legitimate business activities in Albania. Mr. Ciraku’s bank could not provide statements more than 10 years old. The
applicant submits that it is therefore impossible for him to demonstrate the
initial deposit of the funds. It must be recalled that the applicant bears the
evidentiary burden. If there are obstacles to obtaining documentation the
applicant must bear the consequences.
[29]
The
applicant also claimed that $3,000 belonged to Mr. and Mrs. Zaka from their
income as caretakers of an apartment building, namely cash tips from tenants.
The applicant explained that they exchanged their bills in miscellaneous
denominations with a restaurant owner so that all the funds would be $100
bills.
[30]
As
the money was said to have been received in cash there was no documentation to
demonstrate a legitimate source. Once again, it is the applicant’s burden to
prove the source of the funds. Cash-only transactions present an inherent
difficulty and such a large amount, on its face, gives rise to reasonable
suspicion. This may be particularly so when the funds are said to be tips.
[31]
The
applicant submits that the Minister unreasonably requested and considered
evidence regarding his own source of income. This is said to be irrelevant
because he did not claim that the currency in question was his. In my view,
the applicant’s source of income is a relevant consideration in determining
whether there are reasonable grounds to suspect his involvement in criminal
activity.
[32]
The
applicant also submits that the Minister should not have considered the
Officer’s supplementary narrative report, wherein the Officer detailed his
concerns regarding the source of the currency. In my view, the supplementary
report contained legitimate considerations, including questions regarding the
applicant’s income and living expenses. It was not unreasonable for the Minister
to consider the Officer’s position. There was no prejudice to the applicant
and no public interest or legal reason has been articulated for limiting the
amount of information that the Minister may receive in order to make an
informed decision. This, it should be noted, works in favour of applicants as
much as it does the Minister.
[33]
Finally,
the applicant states that the Minister fettered his discretion by stating that
it was “not possible” to return the currency because the applicant had not
shown a legitimate source for all of it. The Act does not permit
partial forfeiture; rather, either all or none of the currency is forfeited.
[34]
As
a result, I have concluded that the decision was reasonable. Therefore, the
application is dismissed.
JUDGMENT
THIS
COURT’S JUDGMENT is that the application for judicial review is
dismissed. There is no question for certification.
"Donald J.
Rennie"
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