The Bay Street financial district in Toronto on Aug. 5, 2022.Nathan Denette/The Canadian Press
Canada’s anti-money-laundering watchdog terminated a senior intelligence officer earlier this year over allegations of improper handling of a suspicious-transaction report, according to documents filed as part of a grievance before a labour board.
The Financial Transactions and Reports Analysis Centre of Canada, or FinTRAC, has accused Barry MacKillop, the agency’s former deputy director of intelligence, of sharing sensitive financial intelligence with an employee. FinTRAC has also accused Mr. MacKillop of conducting an unauthorized search on a former director and CEO of the organization.
Mr. MacKillop, who was terminated from his job in May, has filed a grievance with the Federal Public Sector Labour Relations and Employment Board, seeking $400,000 in damages and that his security clearance and his position be reinstated.
Mr. MacKillop alleges that his termination and the revocation of his security clearance are “disguised discipline” by his former employer. Disguised discipline refers to disciplinary action that has been disguised by the employer, usually with the aim of limiting the employee’s procedural options.
The Globe and Mail reported on his departure from FinTRAC earlier this year.
Mr. MacKillop’s grievance with his former employer provides the public with an unusual glimpse inside Canada’s financial intelligence unit, a highly regulated independent body that typically conducts its work in private and provides financial intelligence to government departments and agencies.
In January, Mr. MacKillop and the assistant director of intelligence met to discuss a suspicious-transaction report (STR) that identified a FinTRAC employee, according to the documents, which were obtained by The Globe.
Suspicious transaction reports are filed by institutions when they suspect that a financial transaction may be linked to money laundering or terrorist financing, and Canadian law bars the disclosure of the contents of such a report.
During that meeting, Mr. MacKillop agreed that it would be in the employee’s best interest for the assistant director to conduct a wellness check with the employee, to make him aware of the potentially vulnerable situation he was putting himself in, according to documents. Mr. MacKillop was not present at the wellness check, which he asserts was conducted on “humanitarian grounds.”
FinTRAC’s chief human-resources officer, Philippe Blanchette, dismissed an earlier, internal grievance submitted by Mr. MacKillop. In an Aug. 6 letter, he said that while Mr. MacKillop and the other manager “had an ‘understanding’ that the STR would not be disclosed, the fact that you authorized the other manager to meet with an employee to discuss concerns based on information contained in an STR and with no safeguards in place to avoid any unauthorized disclosure of details of this information raises significant concern over your judgment.”
Mr. Blanchette wrote that Mr. MacKillop’s actions call into question his “judgment, integrity, trustworthiness and overall reliability.”
The financial intelligence unit also alleges that in a separate incident, Mr. MacKillop conducted a search in the agency’s intelligence database on a former director and CEO of FinTRAC based on information that the director “had shared about a personal relationship.”
In a May 31 letter revoking Mr. MacKillop’s security status, FinTRAC’s chief security officer, Jean-François Savard, wrote that Mr. MacKillop “unilaterally decided to conduct the search in order to protect the integrity of the agency.”
FinTRAC director and CEO Sarah Paquet terminated Mr. MacKillop’s employment in a subsequent letter, also dated May 31.
Mr. MacKillop argues in his grievance that “no actual breach of FinTRAC policy or of Treasury Board’s security-screening directives/guidelines was ever referenced,” and that he “has suffered significant reputational harm.”
“The revocation of Mr. MacKillop’s security clearance and his termination are both disguised discipline and FinTRAC cannot meet the test necessary to justify such discipline,” the grievance states.
Mr. MacKillop is seeking $250,000 in damages for loss of reputation, $75,000 in aggravated damages for bad faith and $75,000 for punitive damages. He is also requesting that his security clearance and his position be “immediately reinstated,” that the incident be struck from his employee file and that FinTRAC cover his legal costs and refrain from taking any further actions against him.
Malini Vijaykumar, Mr. MacKillop’s lawyer, has said that her client’s situation has been the subject of “rumours and inferences” that have been “swirling around.”
“He hasn’t had the chance to have his say, and now he hopes that he will be able to,” Ms. Vijaykumar said.
FinTRAC said in a statement earlier this month that as it “works to protect Canadians and Canada’s financial system, the centre is committed to safeguarding the personal and classified information to which it is entrusted. The protection of information is a legal obligation, core to FinTRAC’s mandate and fundamental to maintaining the trust and confidence of Canadians.”
“As this case has been referred for adjudication with the Federal Public Sector Labour Relations and Employment Board, FinTRAC cannot provide any further comment,” the statement added.
The Globe previously reported that Mr. MacKillop and Daniel Lambert, who functioned as Mr. MacKillop’s deputy, were escorted out of FinTRAC’s Ottawa office by security earlier this year, while an investigation was under way.
According to Mr. Lambert’s LinkedIn profile, he served as FinTRAC’s assistant director responsible for intelligence operations from September, 2015, until May, 2024, before listing himself as taking a “Career Break” in June.