Ethics law loopholes allow him to profit from his decisions and actions

Trudeau Cabinet should appoint an unbiased, experienced foreign service officer as Canada’s Ambassador to China

FOR IMMEDIATE RELEASE:

Wednesday, February 5, 2020

OTTAWA – Today, with Canada’s new Ambassador to China Dominic Barton scheduled to testify this evening before the special House Committee on Canada-China relations, Democracy Watch called on the Trudeau Cabinet to replace him with an experienced foreign service officer who doesn’t have the financial conflicts of interest that Barton has.

Because of disclosure rules in Canada’s Conflict of Interest Act, and other public disclosures, we know that investments of Mr. Barton and his spouse Geraldine Buckingham in McKinsey & Company, and BlackRock Inc., combined with his spouse’s work as BlackRock Inc.’s Chair for the Asia Pacific region, tie them into the interests of at least 22 of China’s biggest 100 state-owned companies, and generally with wealthy Chinese investors.

Mr. Barton also has investments in four private equity funds, including one located in the Cayman Islands, and another with a Caymans connection that appears in the Offshore Leaks/Paradise Papers Database. Neither of these funds disclose the full list of their investments. The other two funds invest in companies in the healthcare, computer technology, biotechnology, financial services, China real estate, insurance, mining, food, chemicals, construction beauty and education sectors.

Mr. Barton and his spouse also have investments in Teck Resources Ltd., a Vancouver-based mining company that has the China Investment Corporation as one of its biggest investors. And he is invested in an American AI company called SparkCognition, and a Vancouver-based agricultural company called Terramera. Only three of his known investments are in Canadian companies.

Mr. Barton has not done anything to neutralize the effect his and his spouse’s mostly foreign financial interests, and his spouse’s work, will have on him as ambassador.

He has placed some investments in a so-called “blind trust” but he knows what’s in the trust, and he chose and is allowed to give instructions to his trustee. He also has a so-called “ethics screen” but it doesn’t prohibit him from participating in decisions if “the interest in the decision or matter is of general application.”

Almost all government decisions apply generally to many companies or industry sectors. As a result, Mr. Barton will be allowed to take part in almost all decisions even when he or his spouse or her clients could profit from the decision. His screen is also a smokescreen as it allows him to hide whether he actually removes himself from any decision-making processes.

Instead of his unethical scheme, Mr. Barton should be required to do what Justice Parker recommended back in 1987 for all public officials – sell all investments he can sell, and remove himself from all decisions that affect any investments or interests he can’t sell (such as his interest in McKinsey as the former head of the firm, and his spouse’s work interests).

That ethical arrangement would likely mean Mr. Barton would have to remove himself from so many decisions that he wouldn’t be able to do his job.

“Dominic Barton’s extensive, mainly foreign financial interests conflict with Canada’s best interests, and his so-called blind trust and ethics screen are so full of loopholes they do nothing to prevent him from profiting from his decisions and actions as Canada’s ambassador to China,” said Duff Conacher, Co-founder of Democracy Watch. “The federal government should replace him with an experienced foreign service officer who has no financial conflicts of interest.”

Beyond his investments, Mr. Barton has also often expressed admiration for China’s one-party government and its dictatorial President Xi Jinping, going as far as saying he has “drank the Kool-Aid.” He is also currently defending himself in a lawsuit alleging he hid McKinsey’s conflicts of interest when he headed up the firm.

The same loopholes in the Conflict of Interest Act that allow Mr. Barton to participate in and profit from his decisions as ambassador in secret allowed Finance Minister Bill Morneau to propose a bill that would have profited him and his family’s company. In the past 15 years, these loopholes have allowed about 20 other ministers and top government officials to take part in decisions from which they, their families or friends could profit.

During this minority government, the House Ethics Committee should review the Conflict of Interest Act and MP ethics code (the last review was in 2013), and MPs should finally close the loopholes, strengthen enforcement and penalties.

As the Supreme Court of Canada stated in a 1996 ruling, to protect our democracy Canadian government officials must be “held to codes of conduct which, for an ordinary person, would be quite severe” to ensure they avoid even the appearance that they are furthering their own or others’ private interests.

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FOR MORE INFORMATION, CONTACT:

Duff Conacher, Co-founder of Democracy Watch

Tel: (613) 241-5179

Cell: 416-546-3443

Email: info@democracywatch.ca

Democracy Watch’s Government Ethics Campaign and Stop Bad Government Appointments Campaign