The Royal Canadian Mounted Police today released a report that spells out improvements recommended for its white collar crime unit, known as the Integrated Market Enforcement Teams (IMETs).

In the last federal budget it was announced that a senior advisor to the IMETs would be appointed. Later, Nick Le Pan (former federal Superintendent of Financial Institutions), was appointed to that position — with a mandate to advise the RCMP and federal departments, and to help develop and guide the implementation of a plan to improve the effectiveness of the IMETs.

Le Pan submitted his report on October 25. It was considered and approved by the force’s senior executive committee on November 19. The RCMP’s commissioner, William Elliott, says he welcomes the recommendations contained in the report and is committed to enhancing its effectiveness in combating capital markets crime. “We have already begun to implement the recommendations and I welcome the ongoing involvement of Mr. Le Pan in our implementation efforts,” he says.

Today, it released the report. It notes that IMET investigation results have been disappointing to many, though there continues to be progress on existing cases. The preventative activities through the Joint Securities Intelligence Units are a success, it says. And, it notes that issues of timely results are partly a problem of unrealistic expectations, partly due to differences in Canada’s legal framework compared to other jurisdictions that are unlikely to change soon, and partly due to issues within the RCMP and its partners.

Nevertheless, Le Pan concludes that the IMETs can improve within the current legal framework. But, he says, there is no one measure that would speed up investigations. The report identifies several essential elements including focusing investigations from the start and having adequate ability to process and analyse the large body of electronic and hard copy documents that are typical of these investigations.

Federal and provincial Crown prosecution offices are also part of the timeliness issue as, depending on the province, they must separately approve or review the police case, before charges are laid.

“Legitimate criticisms center on the lack of results and questioning whether the program and its partners have the sense of urgency needed to succeed,” the report says. ”Nor has IMET demonstrated the leadership, tone from the top, results focus, nimbleness or consistent cohesion of action or communication among the players (including within the RCMP and PPSC and among the federal players) that is necessary to succeed. The Director did not have clear authority to oversee. There are also frustrations building internally. There is a too high a vacancy rate and turnover, and significant key-person risk.”

There are generally good working relations between IMET and provincial securities regulators, Le Pan found. ”However, there can be tensions. The interests of regulators and police do not always coincide when they are both investigating an issue,” it says. ”The existence of multiple securities regulators in Canada can make achieving consensus on issues difficult and time consuming.” For example, different provincial regulators have different interpretations of court decisions which has hampered setting up joint securities intelligence units with the RCMP in some provinces, though these are a success in other provinces.

Major recommendations in the Report include:

  • Enhanced leadership and tone from the top emphasizing results.
  • Fighting capital markets fraud having a higher priority.
  • Making sure all the investigation and prosecution options under existing legislation are developed and pursued.
  • Clarifying accountability and who is in charge within the RCMP.
  • Having the day-to-day IMET operations more closely aligned with RCMP Divisions where the Program is located, while strengthening the HQ oversight, national coordination and ability to intervene to help get results.
  • Put in place a more disciplined results-based management and oversight of investigations to focus, keep them on track and speed up getting to results.
  • Identifying priorities for additional funding including a high priority on additional resources for information management and technical crime support for these very complex investigations.
  • Enhancing cooperation between PPSC and provincial Crowns and the RCMP to reduce delays in Crown consideration of charges, and enhance the likelihood of having high-quality prosecution teams.
  • Specific measures to improve HR management in IMET.
  • Public Prosecution Service of Canada and Provincial Crown offices having a plan for enhanced capability, where necessary.
  • Enhancing relations between IMET and securities commissions.

“I also recommend that the RCMP, Public Prosecution Service of Canada and the federal government who funds the Program, should develop a simple more-formal, medium-term implementation plan re desired and achievable caseload, including potentially more capacity to investigate and prosecute more, smaller, less-complex, investigations,” Le Pan says. ”Accepting more investigations should not become a priority until the accountability structure and improved management practices I recommend are in place and working and until resourcing issues that can hamper existing investigations are dealt with.”

@page_break@“Having success in smaller cases adds to credibility of IMETS and to credibility of capital markets enforcement. It would also help enhance career opportunities and reduce key person risk in the current program,” he adds.