Columns

Let’s start nailing cheaters

Diane Francis November 29 1999
Columns

Let’s start nailing cheaters

Diane Francis November 29 1999

Let’s start nailing cheaters

Diane Francis

Employment Insurance investigators earlier this year were stopped from punishing cheaters when a Federal Court of Canada judge ruled that the methods used to catch 136,000 fraudsters were illegal. This was a travesty—the court was wrong, and legislation should be enacted to overcome this unfortunate precedent.

Entitlement fraud has been an area of interest for me for a long time. I wrote a series of articles in the late 1980s and a book about massive cheating in 1990 with the result that officials in many levels of government began to realize fraud was easy—and possibly rampant. When it came to Employment Insurance, I wrote years ago that the ski hills at Whistler and beaches in Mexico, among other locales, were hill of people on benefits holidaying without any intention of looking for work. Under the rules, then and now, El recipients must be actively seeking employment in Canada and should always be available for job interviews. If they leave the country, or are not seeking work, they must notify the government and have their benefits suspended as long as they are away.

So El investigators came up with a clever technique. They monitored and cross-referenced the names of El beneficiaries with customs declarations. For instance, if someone receiving El benefits in January, 1995, re-entered Canada from Sri Lanka or Portugal or the United States on Jan. 15 after a declared three-week stint, he was guilty of defrauding the system. The results were both dramatic—and hugely disappointing. Human Resources officials, in charge of handing out El benefits, said they could have recouped $98.2 million in overpayments and penalties from 136,000 investigations of people who collected benefits wrongfully while outside Canada. It constituted an unprecedented and massive fraud by a surprisingly large number of people.

Even though the court ruling is now under appeal, it still means that these people now face no consequences for cheating their country. They were let off the hook because Justice Danièle Tremblay-Lamer ruled in January that the government violated the law and rights of individuals by passing along information from one department to another. Privacy commissioner Bruce Phillips applauded the decision because, he said, the El investigation represented an invasion of privacy akin to “a policeman crashing through your front door looking for criminals.” He added: “The concept that you can go riffling through the files of millions of utterly innocent people without their permission in a fishing expedition to catch a few cheats makes a mockery of the trust on which the government collects information from Canadian citizens.”

That’s total poppycock.

People have a right to privacy, but no one has a right to steal money from our governments. To make interdepartmental information-sharing illegal is to sandbag efforts to stop the flow of money to the undeserving and deceitful. Governments, indeed, should be obliged to share information because they are intermediaries on behalf of taxpayers whose money they collect and then dispense. And once convicted, I would go even further to trample the guilty parties’ right to “privacy.” I would publish all their names in full-page ads in newspapers across the country, along with those convicted of tax evasion or other white-collar crimes against government. I’d make the guilty persons pay for the ads, too.

This court decision defies logic. Would the courts tell a corporation that its personnel department cannot share information about an employee’s work record or salary with another department interested in recruiting that individual? What’s the difference? As for the privacy commissioner’s disdain towards “fishing expeditions,” what about Revenue Canada audits or police investigations? These are “fishing” expeditions involving “innocent” persons and yet they are totally necessary. Without tax and criminal enforcement, our country would not be civilized.

Besides enforcement, fraud prevention has been impeded by privacy concerns. Hundreds of billions of dollars are handed out annually in welfare, workers compensation, pension, housing grants and health-care benefits without proper identification programs in place. The easy solution has always been to issue a national identity card to every resident complete with photo, fingerprints, DNA printout and biographical information stored on a microchip. This card should replace cards for social insurance, health and pension, as well as immigrant/refugee documents, drivers’ licences and even, possibly, passports. Such a card would pave the way towards the creation of a national computer system linking all government entitlement programs. As things now stand, anyone can make multiple claims in different cities or provinces involving payments from various government departments. But “smart” cards would stop such nonsense and the technology already is being used in some corporations and in some universities to monitor library usage, pay for cafeteria food, buy books, pay parking costs and for access control in secured portions of the school.

Despite obvious benefits, a national card is not even on the drawing boards and any discussion about it brings out privacy advocates. But what’s forgotten in this legal tussle is that taxpayers have rights, too. They are entitled to have their money dispensed to those in need and to know that those who steal it will be punished.