Any substantive changes in this Legislative Summary that have been made since the preceding issue are indicated in bold print.
Bill S-9, An Act to amend the Criminal Code (auto theft and trafficking in property obtained by crime) (short title: Tackling Auto Theft and Property Crime Act), was introduced by the Leader of the Government in the Senate, the Honourable Marjory LeBreton, and received first reading in the Senate on 4 May 2010. It reiterates the provisions in the former Bill C-26, as amended by the House of Commons.1
Although the bill targets motor vehicle theft, it also addresses trafficking in any property obtained by crime and the exporting and importing of such property. It provides for four new offences and makes consequential amendments to the Criminal Code (the Code), which it amends in four ways:
Motor vehicle theft2 has major repercussions for vehicle owners, consumers, police, insurance companies and governments. The Insurance Bureau of Canada estimates that the financial burden resulting from this crime is over $1 billion per year.3 That estimate includes thefts of uninsured vehicles; health care costs; the costs asso¬ciated with the courts, police services and legal services; and personal expenses incurred by owners.4
According to data reported by police services, the number of stolen vehicles in Canada per 100,000 population declined by 15% in 20085, continuing a general downward trend that began in 1997.6 That decline might be explained in part by the development and implementation of prevention policies and programs by police services, insurance companies and governments. For example, to combat this problem, the federal government has made regulations that since September 2007 have required Canadian auto manufacturers to install electronic immobilization devices in their new vehicles.7 Insurance companies are also trying to reduce the incidence of theft by offering discounts to owners of vehicles equipped with anti-theft devices. Various other programs, including those using bait cars, have also been employed by various police services in Canada. Bait car programs involve parking vehicles owned by police in high-risk areas. If the vehicles are stolen, they are rapidly located using GPS systems.
In spite of the decline in 2008, motor vehicle theft is still one of the most common offences committed in Canada, particularly among 15- to 18-year-olds. In 2008, that age group accounted for close to three in 10 solved vehicle thefts.8 In total, 125,271 vehicles were stolen in 2008, as compared with 146,142 in 2007.9 According to the most recent available data, car thefts accounted in 2007 for slightly over half of the cases reported to police (54%), followed by thefts of trucks, vans and sport utility vehicles (35%) and motorcycles (4%).10
While motor vehicle theft is a Canada-wide phenomenon, some provinces and territories are more affected than others. Generally speaking, rates are higher in western and northern Canada than in the east. In 2008, Newfoundland and Labrador reported the lowest rate (85 per 100,000 population) and Manitoba the highest (746), nearly twice the Canadian average (376).11 In comparison, in 2007, Newfoundland and Labrador reported a rate of 120 thefts per 100,000 population, and Manitoba reported a rate of 1,236 thefts per 100,000 population.
In 2007, for the 15th straight year, Winnipeg reported the highest motor vehicle theft rate in Canada (1,714 per 100,000 population),12 followed by Abbotsford, British Columbia (1,000), Edmonton (832) and Regina (735). Kingston, Ontario, and Saint John, New Brunswick reported lower rates: 176 and 168 auto thefts per 100,000 population, respectively.13
Bill S-9 aims specifically to assist law enforcement agencies in more effectively combatting organized vehicle theft, since criminal organizations often falsify vehicle identification numbers and export vehicles from Canada.
The theft and resale of vehicles, facilitated by the alteration of VIN numbers, is a relatively low-risk,14 high-profit15 activity that is commonly used to finance criminal organizations’ other activities. According to a study conducted by the Royal Canadian Mounted Police in 1998,16 criminal organizations are involved in all aspects of vehicle theft: the ordering of specific vehicles, recruitment of young offenders who steal the vehicles, dismantling of vehicles for parts (“chopping”),17 altering of VINs and documents, and transportation of stolen vehicles outside the province or country. According to the Insurance Bureau of Canada, of the 170,000 vehicles stolen each year, 20,000 are exported out of Canada.18
These multi-level criminal networks19 have all the necessary expertise to obtain, makeover and resell stolen vehicles on a large scale. It is estimated that one in five vehicle thefts is attributable to organized crime networks.20
While vehicle theft by organized groups is a national problem, Criminal Intelligence Service Canada believes that organized groups involved in this type of crime are active mainly in Montreal and Toronto.21
Under the Motor Vehicle Safety Regulations,22 the VIN, which is affixed to every vehicle in Canada, consists of 17 alphanumeric characters that provide a unique identifier for every motor vehicle.23 Based on the established codes, the characters designate the manufacturer, the make and class of the vehicle, the model year, the plant where the vehicle was manufactured, and the production serial number assigned by the manufacturer to the vehicle. The VIN appears on various parts of the vehicle, such as its fenders, hood and doors.24
The methods used to affix the VIN, under current requirements, allow the number to be easily transferred from one vehicle to another. To correct the problems associated with the alteration and replacement of VINs, the federal Department of Transport introduced measures in 2004 (which took effect in 2008) to ensure that the VIN cannot be removed without damaging or destroying the VIN plate or label, or the vehicle.25
With respect to falsification methods using the VIN, Criminal Intelligence Service Canada recently noted:
The Insurance Crime Prevention Bureau has identified an increase in four main fraud techniques that are used by organized crime to steal vehicles. These include: the illegal transfer of Vehicle Identification Numbers (VINs) from wrecked vehicles to similar ones that have been stolen; a legitimate VIN is used to change the legal identity of a stolen vehicle of the same make, model, and colour, a process called “twinning” ... .26
At present, there is no offence that specifically relates to motor vehicle theft. A prosecutor must therefore lay charges under the general theft provisions of the Code,27 which apply to most types of property.28 The section of the Code regarding theft in general provides for different punishments, depending on whether the value of the stolen property is greater than $5,000 or $5,000 or less.
Clause 3 of the bill creates a separate offence for motor vehicle theft29 (new subsection 333.1(1) of the Code). It is a hybrid offence, that is, the prosecutor has the choice of proceeding by indictment or by summary conviction. Unlike the existing general offence of theft, the new offence of motor vehicle theft does not provide for different punishments depending on the value of the property. In the case of a third or subsequent conviction for motor vehicle theft, where the offence is prosecuted by indictment, the bill provides for a minimum prison sentence of six months. For this minimum sentence to apply, the third offence (and any subsequent offence) must be prosecuted by indictment. However, under an amendment adopted in June 2009 by the House of Commons Standing Committee on Justice and Human Rights during study of the former Bill C-26 and included in Bill S-9, the first and second offences may have been prosecuted either by indictment or by summary conviction.
Table 1 compares the punishments provided for the new offence of motor vehicle theft and the punishments provided for the existing general offence of theft.
| Method of Prosecution | Existing Offences and Sentences in the Criminal Code | Offences and Sentences in Bill S-9 |
|---|---|---|
| Theft | Motor Vehicle Theft | |
| Indictable offence | Value of property – over $5,000: maximum 10 years |
Regardless of value: maximum 10 years Regardless of value: minimum 6 months (if third or subsequent offence) |
| Value of property – $5,000 or less: maximum 2 years |
||
| Summary conviction offence | Value of property – $5,000 or less: maximum 6 months and/or $5,000 fine |
Regardless of value: maximum 18 months |
Upon the coming into force of Bill C-16,30 clause 12 of Bill S-9 provides that the judge determining the sentence for a person found guilty of an offence of motor vehicle theft prosecuted by indictment will not be able to order the offender to serve the sentence in the community. The judge must choose among other sentences.
Currently, a person who alters a VIN in order to conceal the identity of a stolen vehicle is often charged with possession of property obtained by crime or an offence under other theft-related provisions. The Criminal Code deals specifically with VINs in subsection 354(2), which provides, in the context of a charge of possession of property obtained by criminal means, for the assumption that if the VIN has been altered, the vehicle has been stolen.31 However, altering the VIN is not in itself an offence.
Bill S-9 makes it an offence to alter, remove or obliterate a VIN32 (new subsection 353.1(1) of the Code.). The VIN is defined in terms that are similar to those used for the offence of possession of property obtained by crime (new subsection 353.1(2) of the Code).33 An additional tool is thus made available to law enforcement agencies to enable them to lay charges in cases of theft, makeover and resale of motor vehicles.
In the terms used in the bill, the new offence applies to an accused who “wholly or partially alters, removes or obliterates a vehicle identification number on a motor vehicle.” Since criminal organizations often dismantle stolen vehicles, it might be asked whether it would not be prudent to add the phrase “or on a part thereof” or a similar expression.34
Former Bill C-6435 provided that the prosecution had to prove that the VIN had been altered “under circumstances that give rise to a reasonable inference that the person did so to conceal the identity of the motor vehicle.” The same offence in Bill S-9 does not include this stipulation. However, Bill S-9 expressly provides that lawful conduct, such as regular maintenance of the vehicle, body work and auto recycling or wrecking, is a valid defence (new subsection 353.1(3) of the Code).
Under new subsection 353.1(4), altering, removing or obliterating a VIN is a hybrid offence. Subsection 353.1(4) provides for a maximum sentence of imprisonment for five years in the case of an indictable offence. If instead the prosecution decides to proceed with a summary conviction, the offence is punishable by a $5,000 fine or imprisonment for six months, or both.36 These are the same sentences provided in the former Bill C-64.
Because the offence of altering a VIN is punishable by imprisonment for a maximum of five years, it falls into the “serious offence” category. If such an offence is committed repeatedly by a group of three or more persons, it may be considered an offence committed by a “criminal organization,”37 with all the consequences that may carry for police investigations, prosecutions and sentencing.38
At present, the Criminal Code deals only with the possession of property obtained by crime.39 The bill adds two offences to the Code: trafficking (new section 355.2) and possession of property obtained by crime for the purpose of trafficking (new section 355.4).
As in the case of possession of property obtained by crime, the property must have been derived from the commission of an indictable offence inside or outside Canada. In addition to criminal origin itself, the prosecution must also prove, beyond a reasonable doubt, that the accused had knowledge of the criminal origin.40 Also, as in the case of possession of property obtained by crime and laundering proceeds of crime,41 the Attorney General of Canada can conduct proceedings in respect of the two new offences created by the bill (clause 7 of the bill).
The definition of “traffic” (new section 355.1 of the Code) covers a wide range of activities, including selling, offering and delivering, as well as exporting and importing. The new offences may therefore apply to all intermediaries who are involved in the movement of property obtained by crime.
New section 355.5 of the Code provides that the two new offences are indictable offences if the value of the property is more than $5,000 or hybrid offences if the value of the property is $5,000 or less. Table 2 compares the maximum penalties for the new offences with those for the existing offence of possession of property obtained by crime.
| Value of the Property | Method of Prosecution | Existing Offences and Sentences in the Criminal Code | Offences and Sentences in Bill S-9 | |
|---|---|---|---|---|
| Possession of Property Obtained by Crime | Trafficking in Property Obtained by Crime | Possession of Property Obtained by Crime for the Purpose of Trafficking | ||
| > $5,000 | Indictment | 10 years | 14 years | |
| ≤ $5,000 | Indictment | 2 years | 5 years | |
| Summary conviction | 6 months and/or $5,000 fine | 6 months and/or $5,000 fine | ||
The Code provides for measures to preserve property: seizure and restraint before trial, so that proceeds of crime can then be forfeited.42 A person with an interest in property that was seized or in respect of which a restraint order was made may, however, apply to a judge for an order of restoration of property or revocation of the restraint order.43 If the judge orders that the property be returned, no charge for possession of property obtained by crime may be laid against the person with an interest in the property as a result of its being restored. Clause 8 of the bill adds that in that case, no charge may be laid under the provisions for the new offences of trafficking in and possession for the purposes of trafficking in property obtained by crime.
A prosecutor may make an application to a judge for disclosure of income tax information relating to a person who is believed, on reasonable grounds, to have committed an offence consisting of possession of property obtained by crime or laundering proceeds of crime in connection with a drug-related offence.44 Under clause 9 of the bill, the prosecutor may make such an application in the case of an investigation relating to the new offences of trafficking in or possession for the purposes of trafficking in property obtained by crime in connection with a drug offence.
Property that must be restored may be photographed by a peace officer when charges are laid for certain offences, including theft, breaking and entering, possession of property obtained by crime, and fraud.45 Clause 10 of the bill adds the new offences of trafficking in and possession for the purposes of trafficking in property obtained by crime. Photographs taken during investigations relating to those offences may therefore be introduced in evidence in court.
The Code provides that any number of persons may be charged in the same indictment with an offence of possession of property obtained by crime or possession of a thing obtained by theft from the mail, even if the property was in their possession at different times.46 Under clause 11 of the bill, the same possibility will exist for persons charged with the new offence of possession of property obtained by crime for the purposes of trafficking.
The Customs Act47 authorizes the CBSA to seize goods whose importation or exporttation is prohibited under an Act of Parliament. At present, however, no federal legislation prohibits the importation or exportation of property obtained by crime.48
Bill S-9 prohibits the importation and exportation of property obtained by crime (new section 355.3 of the Code). This means that CBSA officers will be able to examine, seize and forfeit property obtained by crime that is imported or destined for exportation.
In addition, the Reporting of Exported Goods Regulations49 were amended in 2005 to require that VINs be reported for conveyances permanently exported from Canada. The purpose of that amendment was to allow CBSA officers to examine containers destined for export in order to identify stolen vehicles.50
Judicial authorization for electronic interception of a private communication may be obtained only in respect of certain offences listed in section 183 of the Code. Clause 2 of the bill adds to that section the four new offences created by the bill: theft of a motor vehicle, tampering with a VIN, and trafficking in property obtained by crime and possession for the purposes of trafficking in such property. Law enforcement agencies will therefore be able to use electronic surveillance to investigate these offences.
* Notice: For clarity of exposition, the legislative proposals set out in the bill described in this Legislative Summary are stated as if they had already been adopted or were in force. It is important to note, however, that bills may be amended during their consideration by the House of Commons and Senate, and have no force or effect unless and until they are passed by both houses of Parliament, receive Royal Assent, and come into force. [ Return to text ]
(55 Kb, 5 pages), November 2004. [ Return to text ]© Library of Parliament