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CRA criminal investigators given badges

March 2007

For many years, Canada Revenue Agency (CRA) investigators used the same statutory powers as auditors in the course of their criminal investigations. However, in November 2002, the Supreme Court of Canada ruled in the Jarvis and Ling decisions that CRA investigators could not rely on these administrative powers to gather evidence for purposes of their criminal investigations. The Court determined that, in the criminal context, the use of these authorities was an unreasonable search and seizure because a person's liberty was at stake.

As a result of that decision, a number of changes were undertaken to ensure that the procedures used by investigators to gather information conformed to the Court's ruling.

The issuance of a badge and accompanying authorization card to employees involved in criminal investigations represents an important step in our efforts to make a clear distinction between an auditor and a criminal investigator.

Respecting the Canadian Charter of Rights and Freedoms

The Jarvis and Ling cases raised issues related to the Canadian Charter of Rights and Freedoms and whether the individual's rights under section 7 and 8 of the Charter were violated during the conduct of our audits. Section 7 of the Charter is the right against self-incrimination and section 8 deals with unreasonable search and seizure.

The Court concluded that a definite line can be drawn between the audit function and the investigative function of the CRA. The principles established by the Court focus primarily on the 'predominant purpose' of any given audit action. If it is established that the predominant purpose was to determine civil tax liability, then the Charter rights have not been violated.

However, where the predominant purpose of the CRA's actions is determined to be relating to penal liability, then full Charter protection is invoked. The Court stated that once this happens, the CRA no longer has the authority to use its legislative powers under the Income tax Act and the Excise Tax Act to compel documents or information. Search warrants must be used under these circumstances.

Want more information?

To read more about CRA investigations, please visit the CRA's "Enforcement and Disclosures" Web pages at http://www.cra-arc.gc.ca/agency/investigations/menu-e.html.

This document is also available for download in PDF format.

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Date modified:

2014-12-03