Bill C-299 (Historical)

An Act to amend the Criminal Code (identification information obtained by fraud or false pretence)

Criminal Code

[Colin Carrie, Conservative, Parliamentary Secretary to the Minister of Industry]

Mr. Speaker, I rise today to speak to Bill C-299, An Act to amend the Criminal Code, the Canada Evidence Act and the Competition Act (personal information obtained by fraud). I will use my time today to discuss the proposed amendments to the Competition Act and the implications of the proposed bill for the privacy protections established by the Personal Information Protection and Electronic Documents Act, PIPEDA.

Before dealing with the specifics of these amendments, I would like to briefly comment on the overall intent of the bill. As I understand it, Bill C-299 seeks to protect Canadians' personal information from pretexting, that is, the collection of their personal information through fraud and impersonation. This is a very real concern for Canadians. I fully understand the hon. member's desire to combat the collection of personal information through fraudulent means. The Government of Canada has taken a keen interest in this issue given Industry Canada's responsibilities for PIPEDA and its overall goal of building a safer, more secure Internet.

New information technologies have revolutionized the way business is conducted and helped to make Canadian companies among the most efficient and competitive in the world. However, the electronic collection, storage and transmission of personal information, at the same time, carries the risk that personal information may be misappropriated and used without the consent of the individual to whom this information pertains.

What is particularly problematic here is that the full extent of the threat is unknown. Victims often do not know that their personal information has been stolen. When they do find out it can be months or even years. Victims can register their complaints with a variety of different organizations, such as credit bureaus, banks, credit card companies, federal and provincial privacy commissioners and, yes, law enforcement agencies. However, while it appears that this problem is pervasive, many victims do not report the crime at all. These victims silently suffer financial losses, a loss of reputation, emotional distress and the often difficult task of rebuilding their credit rating.

Those victims who do come forward report that their misappropriated personal information has been used in a variety of ways, including to open up a new credit card account, commit insurance or payment fraud, obtain government benefits, open up a new phone or utility account, or take out a loan in their name.

Clearly, we can all agree that this is a very serious problem, and the hon. member for Edmonton—Leduc is seeking to tackle this. However, what is the best way to deal with it? With this bill, the hon. member has proposed a number of avenues through which to do so. It is in this light that I wish to make my comments with respect to the amendments to the Competition Act.

The Competition Bureau is an independent law enforcement agency responsible for the administration and enforcement of the Competition Act, the Consumer Packaging and Labelling Act, Textile Labelling Act and the Precious Metals Market Act.

The Competition Act is an extremely important piece of framework legislation touching on virtually all sectors of the Canadian economy. It promotes and maintains competition so that Canadians can benefit from competitive prices, product choice and quality services. Headed by the Commissioner of Competition, the organization investigates anti-competitive practices and promotes compliance with the laws under its responsibility.

The bill seeks to amend a number of sections of the Competition Act to include provisions dealing with fraud, false pretenses and fraudulent impersonation.

As I mentioned earlier, the Competition Bureau promotes and maintains competition so that Canadians can benefit from competitive prices, product choice and quality services. More specifically, the bureau's mandate, as it relates to misleading representations, is to ensure that consumers are able to make informed decisions based on the most accurate information possible.

Under the Competition Act, misleading advertising is dealt with in two ways: through criminal provisions in section 52 of the Competition Act, and through non-criminal provisions in section 74.01 of the Competition Act.

Bill C-299 seeks to amend section 52. Currently, section 52 of the Competition Act contains a general prohibition to deal with the most severe cases of misleading advertising. It prohibits all materially false or misleading representations made knowingly or recklessly in the promotion of a product or business interest. Misleading advertising occurs when a representation is made to the public that is false or materially misleading and such a representation could influence a consumer to buy the product or the service advertised.

Additionally, Bill C-299 seeks to amend section 74.01 of the Competition Act. Currently, section 74.01 deals with deceptive marketing practices which are dealt with through administrative rather than criminal remedies. Under this section, a person engages in “reviewable conduct” where that person, for the purpose of promoting, directly or indirectly, any product or business interest, makes a representation to the public that is false or misleading in a material respect.

“Reviewable conduct” includes representations to the public as to the efficacy or length of life of a product that is not based on adequate or proper testing. It also includes representations to the public in the form of a warranty, guarantee or promise that is materially misleading.

Finally, Bill C-299 proposes an amendment to section 36 of the Competition Act, which deals with the recovery of damages in criminal cases and where there is a failure to comply with an order of the Competition Tribunal.

As I indicated earlier, the Competition Act is a key piece of framework legislation. If this bill is in fact referred to committee, I would urge a detailed examination of the proposed amendments to the Competition Act.

Let me now turn to my comments on Bill C-299's relationship to the personal information Personal Information Protection and Electronic Documents Act, PIPEDA, and the privacy protections that it establishes. There are varying consequences to deceitfully or fraudulently obtaining personal information. Individuals may be exposed to the risk of identity theft or their address may be obtained by a stalker or abusive ex-spouse. Alternatively, they may find their information populating a data broker's database or they may merely be subjected to unwanted marketing.

I would note that PIPEDA already addresses certain situations that Bill C-299 proposes to capture in relation to pretexting. For example, PIPEDA requires that organizations obtain individuals' knowledge and consent prior to the collection, use or disclosure of their personal information in the course of commercial activity.

Under the act, consent must be obtained anew for any use or disclosure for a purpose that differs from the purpose for which it was originally collected. On this basis, the act already requires that personal information be collected by fair and lawful means and that consent not be obtained through deception.

A very important aspect of PIPEDA makes organizations accountable for the information that is in their custody, including information that has been transferred to third parties for processing. Accountability is maintained whether these third parties are located in Canada or abroad. In this respect, there may be situations where PIPEDA provides a sufficient and adequate legislative response to the deceptive collection of personal information.

The member for Edmonton—Leduc has indicated that with this bill he aims to provide a remedy for individuals who have been subjected to the invasive practice of pretexting. I agree that effective recourse is essential to dealing with privacy violations.

Such a mechanism exists under PIPEDA, where privacy related conflicts are resolved through mediation and dispute resolution mechanisms with the assistance of the Privacy Commissioner of Canada. Unresolved matters may be taken to Federal Court, which has the power to order organizations to modify their practices and award damages to the aggrieved.

In light of the wide range of activities related to identity theft and the urgency of addressing the many facets of this issue, I would hope that linkages between this bill and other related government initiatives be considered.

For example, during the first hour of debate of this bill, the Parliamentary Secretary to the Minister of Justice and Attorney General of Canada noted that justice officials had been consulting with key stakeholders on improving the Criminal Code of Canada to deal with identity theft, adding that the department was committed to ensuring that Canada's criminal laws contain comprehensive and effective tools to combat identity theft.

The parliamentary secretary noted that he looked forward to working with his colleague, the member for Edmonton—Leduc, on protecting Canadians' personal information from misappropriation. Similarly, I would suggest that the upcoming review of PIPEDA will provide an opportunity for members of Parliament to assess whether the act's oversight and redress regime provides sufficient recourse for victims of privacy invasions such as pretexting.

I expect that a collaborative approach could be quite effective in addressing these issues that are of great concern, including phishing, spyware and related Internet threats, all of which can facilitate identity theft in the online environment.

I take this opportunity to echo the parliamentary secretary's suggestion and express my support for collaboration to ensure the development of a coherent and comprehensive solution to address issues related to the deceitful or fraudulent acquisition of identity information and to identity theft.

[Cheryl Gallant, Conservative, Renfrew—Nipissing—Pembroke, ON]

Mr. Speaker, it gives me great pleasure to rise and speak today in support of my colleague, the member for Edmonton—Leduc, in whose name this legislation is presented.

As a hard-working member of the industry committee, the hon. member is in touch with the concerns of the marketplace and various business practices. I share his apprehension when it comes to the importance of protecting personal information about individuals. I also recognize the fact that this is a challenge of the information age and a relatively new problem.

Defining this issue may mean that more than one attempt may be necessary in order to address the predicament which Bill C-299 is seeking to address.

The issue of personal information, how it is obtained and its various uses, was not an issue that the residents of Renfrew—Nipissing—Pembroke indicated to me was of urging and pressing necessity. However, during the last election, when one of my opponents reverted to an all too depressingly familiar style of negative campaigning that has come to characterize the old Liberal Party, the issue arose in a nuanced context to this private member's bill now before Parliament.

As is the practice of many members of Parliament, I communicate with the constituents of my riding of Renfrew—Nipissing—Pembroke in a variety of different means. One way is by sending birthday greetings. In the case of birthday greetings, individuals will send me details on behalf of a friend or a loved one through various methods. Usually it is a child who sends in details of a parent who has reached a milestone of life and wishes a congratulatory message from his or her MP to help celebrate the occasion.

Only the Liberal Party could see something sinister in sending a birthday greeting or Christmas cards to individuals. Nevertheless, this was the issue that the Liberal Party deemed to be most important in my riding, and it proceeded to attack on that basis.

I am pleased to confirm, by my presence in the chamber today, that not only did this tactic backfire, but constituents tell me this caused my opponent to finish more poorly than did his predecessor. The electors, in their wisdom, gave me the honour of being re-elected for the third straight election with the highest percentage of the popular vote for a Conservative in the province of Ontario. The smart voters of Renfrew—Nipissing—Pembroke are never wrong.

I relate this story to illustrate the difference between what Bill C-299 seeks to accomplish, which is to amend the Criminal Code to act as a deterrent to the fraudulent obtaining of personal information for abuse, and the generic use of information within the public domain, which is not the intent of this legislation to criminalize.

As a Conservative, I am proud to say that my party and I stand for less government, lower taxes, and a desire to interfere in the daily lives of Canadians in as few ways as possible. The one issue that separates the political labels of the left, which Canadians understand to mean Big Brother or more government, and the right, which Canadians understand to mean less government and more individual freedom, is the issue of personal information.

There are few topics I feel more strongly about than the privacy of individuals and the need to keep big government in check. However, the fact of the matter is that Canadians do live in the information age and in the electronic age a balance must be struck between the gathering of information and the use of that information.

Since I was re-elected I have been working on behalf of the people of Renfrew—Nipissing—Pembroke to bring high speed broadband, the information highway, to all the residents in my riding, particularly the residents in the rural parts of my riding who are without high speed Internet service.

New jobs and businesses are opening fast in the field of technology. We need to be able to provide companies that wish to locate in our rural communities with a skilled workforce and access to high speed communications. People cannot develop the skills needed to work in these new jobs if the tools to learn are not provided for them. Businesses will not locate in the rural communities without access to high speed communications. Without broadband technology, businesses in rural Renfrew County will not be able to fully compete on a local or global basis.

The future economic well-being of our residents depends on the smooth flow of knowledge. The difficulty is once the information highway is built, some things that travel on the information highway are not wanted. Spam fits that definition.

The May 2004 Anti-spam Action Plan for Canada defines spam as “unsolicited commercial email”. By this definition, the firm MessageLabs estimated that spam accounted for as much as 80% of global email traffic at the end of 2004, up from about 10% in 2000.

Spam is more than a growing nuisance. It is a public policy issue that challenges governments, internal service providers, ISPs, other network operators, commercial emailers and consumers to work together in new ways, with each stakeholder group fully playing its part to solve the problem that threatens the interests of all. Spam annoys and offends Internet users. It also provides a vehicle for activities that are clearly illegal, or should be.

While Bill C-299 would not curb all spam, it should curb: malicious actions that cause harm to computers, networks or data, or use personal property for unauthorized purposes, for example, viruses, worms, Trojan horses, denial of service attacks, zombie networks; deceptive and fraudulent business practices, including online versions of traditional mail-based frauds, for example, the Nigerian bank account, or 419 scam, and spoofed websites masquerading as legitimate businesses; phising emails designed for identity theft or to steal money; and invasions of privacy, for example, email address harvesting, spyware.

Because of all the above threats, spam undermines consumer confidence in e-commerce and electronic transactions between citizens and their governments. In addition, it imposes significant costs throughout the economy. These costs fall on a wide range of stakeholders, including: ISPs and other network operators, large enterprise users, universities, government departments, which must invest in the technical, financial and human resources needed to deploy anti-spam technologies at the expense of investments in new or improved services and which must allocate resources to respond to customer complaints; legitimate commercial emailers and other users of email services whose messages get filtered out by an anti-spam technology before they reach their intended recipients; and private and public sector organizations which employees waste time dealing with spam sent to their business email address.

Ultimately, all these costs fall directly, or indirectly, on consumers and Internet end-users who must cover the costs of fighting spam not only by purchasing Internet security software, but also by forgoing other kinds of service improvements and paying higher prices for the online products.

In closing, I once again congratulate the member for Edmonton—Leduc for bringing forth this legislation to deal with a serious and growing problem. I look forward to working with the member as we seek to find a solution to this problem.

[The Acting Speaker, Andrew Scheer]

Resuming debate.

There being no member rising, the hon. member for Edmonton—Leduchas five minutes for reply.

[James Rajotte, Conservative, Edmonton—Leduc, AB]

Mr. Speaker, I want to thank all of the speakers, both those from today and in June. I think it has been a very good debate.

I want to thank: the member for Renfrew—Nipissing—Pembroke; the Parliamentary Secretary to the Minister of Industry; the member for Argenteuil—Papineau—Mirabel; the member for Mississauga South, who had some very good points on identity theft in general; the Parliamentary Secretary to the Minister of Justice, who has been very helpful throughout this entire process; the member for Windsor—Tecumseh, from the NDP; the member for Hochelaga; and the member for Moncton—Riverview—Dieppe, who I think had some excellent suggestions in terms of improving this piece of legislation.

I want to touch on just a few points. First, I know that the two members of the Bloc Québécois have expressed some concern about this legislation. They argue that section 403 adequately addresses the issue of identity theft that I am trying to address in my bill. I would respectfully say that section 403 does not adequately address the issue of identity theft, particularly as it relates to new technologies like the Internet. This is a problem that needs to be addressed.

Second, I want to say very clearly that this bill is not in any way about micromanaging any actions of judges. I am not quite sure where the members were getting that in the legislation, but it is certainly not in the legislation. That is not the intent of this legislation at all.

Very plainly, the purpose of this bill is to protect individual citizens against identity theft. It does not deal with the whole problem of it, but it certainly deals with part of it. Identity theft is a problem that needs to be dealt with.

The purpose of this bill is to protect individuals against the collection of their personal information through fraud or through impersonation. The practice, which is known as pretexting, is a growing problem here in Canada and it needs to be dealt with.

Bill C-299 seeks to do three specific things.

First, it would make the practice of pretexting illegal through changes to the Criminal Code and the Competition Act.

Second, it seeks to provide a remedy for victims of this kind of invasion of privacy through legal recourse in the courts and compensation. It is very much about empowering individual citizens to respond to this invasion of privacy.

Third, the bill seeks to tackle the cross-border aspect of pretexting by holding Canadian affiliates of foreign countries liable for invasions of privacy committed against Canadians, one of which was committed against our own Privacy Commissioner, Jennifer Stoddart. I met with her on this legislation. I cannot speak for her, but I think, judging from her reaction, that she would very much like this bill to go to committee and move forward.

I want to also point out that a number of companies, associations and others that deal in the information technology area support this legislation. I am speaking of companies like Alcatel, Bell Canada, Alliance Bell , Telus, Rogers, the Canadian Wireless Telecommunications Association, and ITAC, the Information Technology Association of Canada. All of these companies have pointed out that identity theft is a growing problem here in Canada. They would like to see it dealt with. Even the Chamber of Commerce, which has pointed out some of its issues with specifics of the bill, supports the bill going to committee. The Canadian Manufacturers and Exporters association also has supported this bill.

I have sought to present a bill which deals with a problem that needs to be dealt with here in Canada. I appreciate the comments by all members. It has been a very good debate. I would ask all members to support in principle this bill at second reading and send it to committee, where I would be very open to engaging in a debate and to entertain any amendments that would improve the substance of the bill.

I would like to thank all members of this House for their participation. I look forward to the vote next week.

[The Acting Speaker, Andrew Scheer]

The time provided for debate has expired. Accordingly, the question is on the motion. Is it the pleasure of the House to adopt the motion?

[Some hon. members]

Agreed.

No.

[The Acting Speaker, Andrew Scheer]

All those in favour of the motion will please say yea.

[Some hon. members]

Yea.

[The Acting Speaker, Andrew Scheer]

All those opposed will please say nay.

[Some hon. members]

Nay.

[The Acting Speaker, Andrew Scheer]

In my opinion the yeas have it.

And more than five members having risen:

Pursuant to Standing Order 93, the division stands deferred until Wednesday, November 1, immediately before the time provided for private members' business.

[Diane Finley, Conservative, Haldimand—Norfolk, ON]

Mr. Speaker, I believe that if you seek it, you would find unanimous consent to see the clock as 7:37 p.m.

[The Acting Speaker, Andrew Scheer]

Is that agreed?

[Some hon. members]

Agreed.

[The Acting Speaker, Andrew Scheer]

It being 7:21 p.m. the House stands adjourned until tomorrow at 10 a.m., pursuant to Standing Order 24(1).

(The House adjourned at 7:21 p.m.)