Canada’s reputation for squeaky cleanliness has taken a nosedive, according to an anti-corruption watchdog. This week, Transparency International (TI) released its annual Corruption Perceptions Index for 2021. The index shows Canada continuing its downward spiral, after falling out of the top 10 in 2019. Large-scale money laundering and opaque institutions are among the reasons for the decline.
Corruption Perceptions Index
The Corruption Perceptions Index (CPI) measures the perceived level of corruption in the public sector. The data comes from professional surveys on their perception of the issues. It is collected by independent organizations such as the World Bank and the World Economic Forum. Each country gets a score between 0 and 100, with lower scores being worse. It is important to emphasize that this is not the opinion of Transparency International. This is how professionals perceive the local situation, and it tends to be more biased.
A country with a low level of perceived corruption is not necessarily free from corruption. It’s just not considered corrupt due to the lack of visibility. This can be due to various reasons, such as an opaque government or a lack of will to prosecute. No conviction means it didn’t officially happen, right? In other words, it can bias the positive if the audience can be convinced it doesn’t exist. We’ll come to that in a second.
Corruption in Canada could get worse
Canada lowers the wrong kind of CPI, perception of corruption rising sharply. The country’s score fell to 74 points in 2021, down 3 points from the previous year. Canada now ranks 13th, dropping two spots from last year. According to Transparency International Canada (TI Canada), the country fell out of the top 10 in 2019. Over the past five years, the country has dropped eight points.
“The problem of money laundering in Canada and other corruption scandals have dominated the headlines in recent years, which has weakened the perception of Canada as a clean country,” said the general manager of TI Canada , James Cohen.
Money laundering estimates in Canada now stand at $113 billion
Cohen attributes the decline to money laundering, a lack of whistleblower protection and an opaque government. According to recent estimates, between $43 billion and $113 billion is laundered each year in Canada. Whistleblowers have no protection, which has consequences for those who report a crime. Then there is freedom of information.
Most democracies provide some access to public information. However, experts said the country was more opaque than many tax havens. Access to information requests exist, but with examples where the state asks for 80 years to prepare the documents, they scoff at access. Measurements only exist in theory.
TI Canada says the country is taking steps to improve its situation. More resources are promised for the fight against money laundering (although they may only replace what has been cut). The promises of a register of beneficial owners are also a big step forward. Although it won’t be ready until 2025.
“We’re hearing some of the good things from the federal government and some provinces, but the political will to fill Canada’s gaps needs to be strengthened,” Cohen said.