The
Heritage Front AffairA report to the Solicitor General of Canada
The
Heritage Front Affair
According to Service policy, Human sources "... shall not normally
be offered any form of inducement or compensation, other than the assurance
of confidentiality and payment in money or payment in kind, in exchange
for providing operational assistance to the Service."
CSIS pays sources for "operational assistance" usually
information. It provides these payments according to an annual budget.
The Service reimburses sources for monies spent while assisting the
Service. The Service accounts for some of the expenses as part of the monthly
payments to the source. Trips by the sources, however, are accounted for
separately. This is done, in part, because the Service provides travel
advances.
The Service noted that, on average, expenses were $260 per month over the
seven years, an amount which was, in their view, reasonable.
The Service compensated the Source from time-to-time for special trips.
Usually, the Investigator would estimate the likely cost of the trip before
the fact, and provide the Source with a cash advance. The Source, on completing
the trip, would provide the handler with receipts, and the handler would
then calculate the balance from the advance. All expenditures relating
to trips, throughout the period, are rigorously accounted for by receipts.
The
handler also compensated the Source for daily expenses. He usually claimed
for regular expenses once a month [1]. These
expenditures were, primarily, for meals, telephone use, and transportation.
Until January 1990, the "Source Financial Statements"
would list items and the corresponding receipts obtained from the Source.
Beginning in February 1990, the handler estimated expenses, and would periodically
ask the Source for receipts.
According to the CSIS Operational Manual, to obtain authorization, the
handler has to fill in the "Source Financial Statement",
and the Human Source office has to review the statement and ensure that
"receipts are attached or an explanation is given when receipts
are not obtained".
According to the records we examined, the Source frequently divided up
expenses with other Heritage Front members, and he was reimbursed accordingly
by CSIS. For example, CSIS paid the source only $67 dollars on two Radisson
Hotel invoices totalling $202 dollars.[2]
The invoices had a hand notation that the bill had been split three ways.
Such invoices, and hand notations, were common.
From
time to time the Source would agree to pay dues and make contributions
to the Heritage Front. For example, one telex shows that the Source listed
people making donations, and put himself down for $40. Another telex shows
that the Source obtained a "Nationalist Party citizenship card".
Recipients "were to pay $50 on receipt of their card".
All group members were asked to "donate some personal money"
to defray the printing costs of the Heritage Front publication "Up
Front". There is no evidence that the Source ever contributed
to Droege's legal fees.
According to the Source, as a Member of the executive, he was generally
exempt from paying dues and paying for the magazine subscription. Many
of the contributions took the form of paying for group meals, transportation
or accommodation. He noted that he had made an initial contribution of
$70 to $100 dollars to the Heritage Front. On one occasion, he had had
to come up with several hundred dollars for hall rental, of which all but
$50 was reimbursed. He also said that he had pledged $75 to $100 to help
defray the cost of the Metzger's trip, though this may have been written
off against a lunch for Droege's lawyers. He paid 25% (probably $200 -
$300) of the publication costs for the first issue of the Heritage Front
magazine, "Up Front". He provided $90 - $100 towards the
Front hotline, but was reimbursed by Droege and, on a special occasion,
he donated some money because Droege wanted the hotline to continue. Generally,
according to the Source, he made no direct contributions, although he would
buy T-shirts and the like from time to time.[3]
The Source said that he always claimed for what he spent, and he does not
think that CSIS provided funds for the creation or maintenance of the Heritage
Front through any other means.[4] He said
that he was "cheap", and Front members knew "he
would not part with a penny".[5]
The Source said that he sometimes paid lunch expenses during Court hearings.
Droege would ask him to pay the bill and would then reimburse him. In 1993,
there were five or six times when the bill might have been $50 for sandwiches.
The Source added that Droege reimbursed him dollar-for-dollar about 50%
of the time.
The handler said that Droege and the Heritage Front collected money in
a haphazard manner. He thought dues were between $25 and $50. The Source,
like other leaders, would frequently duck paying dues. According to the
handler, the Source contributed no more than $1,000 over five years in
donations to the operations of the Heritage Front. This takes into account
postage, letterhead paper, general office supplies, donations to the Heritage
Front legal fund, and $25 here and there. The Source said that he may also
have made a $25 contribution to the costs of Ken Barker's hotline.[6]
The handler discussed the treatment of dues and contributions as expenses.
He noted that he was not required to itemize and account for specific expenses,
but that he himself vetted expenses from time to time . He also noted that
the Source was supposed to tell him about any contributions he made to
the HF, and that any large amounts were to be approved first by Headquarters.[7]
In our review of the expenses files, we found no reference to any contributions
or donations. In our review of the source administrative files, we found
no applications to Headquarters for donations or contributions.
CSIS officers stressed to the Source that the payments were temporary,
and actively encouraged him to look for other work. At one point, he was
asked for "a monthly report detailing [his] efforts to find a job".
Evidence from many sources indicates that the Source did not spend lavishly.
A review of his 1989 and 1990 "meals" expense receipts
indicates that he only infrequently (i.e. perhaps four or five times a
year) "treated" anyone. Many of the available bills indicate
that he paid (and was reimbursed for) only 1/4 or 1/3 of the bill. Most
of the meal bills were for $50 or less. CSIS did not keep itemized receipts
after 1990.
Nor was he generous with CSIS money. He apparently gave few gifts that
CSIS was specifically billed for; total miscellaneous expenditures for
seven years are less than $260.
According to the handler, the Source did not have much to spend. He earned
between $35,000 and $40,000 per year from his employment, including car
allowances and benefits. He supplemented this with odd investigation jobs.
Considering the time spent in his employment and his work for CSIS, however,
the handler indicated that he did not have much time for odd jobs. He did
some skip tracing, but not very much or for very long: no more than $5,000
in total.[8]
The handler said that the Source was thrifty, as were other Heritage Front
members. Also, he was in some financial difficulty. He was always in debt
because he used his credit card for expenses and maintained high debit
balances. Also, his car (a 1987 or earlier year Ford) was always breaking
down. He owed money from a failed business as well. His common law wife
was not working, and he had to support the family. According to the handler,
the Source spent his money on himself not on the movement.[9]
The Source said that he had very little money. He was known within the
Front as not wanting to part with a penny, and he certainly did not have
enough money to finance or underwrite Front activities.[10]
In the CSIS Human Source files, we did not find any discussion of lavish
spending by the source. The Service, of course, did not know precisely
what the Source was spending his income on.
In our review of financial and source administrative files, we found
no indication of any intention to financially support the creation, development,
or continuation of the Heritage Front, or any other groups. In no files
predating August 1994 did we come across any discussion of the potential
of Service payments to assist the Heritage Front. To the best of our knowledge,
it was never a subject of Service discussion.
According to the financial files, the Source did pay for vehicle rentals,
shared accommodation and the like. These costs were then shared with other
Heritage Front members. In the case of meals, the Source infrequently picked
up the bill.[11] More frequently, receipts
indicate that the source paid for a portion of the bill, and that the Service
reimbursed the Source for this portion only. According to CSIS files, "many
of the expenses were paid on a cost-sharing basis (one would pay one time
and someone else the next)".
CSIS noted that the majority of the transportation and meals costs were
paid to the Source as business expenses incurred on their behalf and in
no way supported the Heritage Front.[12]
We asked Al Overfield and Wolfgang Droege if anyone made significant direct
contributions. They indicated that everyone would share in costs, and that
this meant at times giving as much as a few hundred dollars at a time,
but that, in the words of Wolfgang Droege, there were "no large
lump sum payments". Al Overfield said that the Heritage Front
was perpetually broke.
We found no other indication of any funds being provided to the Heritage
Front by CSIS.
When the Metzgers were deported, they were unable to take their flight
from Toronto, and had to have a ticket reissued. This resulted in an additional
expense. The Source paid his share of the additional expense, and the handler
is not certain whether he was reimbursed by Droege.[13]
We found no other indications of funds provided to white supremacists.
According to the files, Sean Maguire, another American white supremacist,
came to Canada with $25,000 to deposit in banks. He deposited most of the
money in various banks, and left the remainder at Grant Bristow's home.
The Source told us that Bristow later returned an unspecified amount to
Maguire.[14]
We asked Wolfgang Droege about possible funding. He indicated that he had
no direct knowledge of any such funding. He noted that Maguire had called
him up to complain that Bristow had not returned $40,000 he had left with
Bristow as an investment. He said that Bristow subsequently returned the
money.
We asked Metropolitan Toronto Police Officers about the funding of foreign
white supremacists. They stated that they saw no money or information going
to or coming from south of the border; people in the movement were supported
by UIC, welfare, donations, subscriptions, and some jobs.[15]
Over a seven year period, the Source was paid less than $80,000 for
actually assisting the Service.
The evaluation of the worth of a Source is always subjective. However,
the Source provided a great deal of information.
According to a CSIS assessment:
"Between the Years 1989 and 1994, Human source coverage has
provided the Service with a high volume of quality information concerning
white supremacist activities in Canada, the United States and, to some
extent, Europe. This coverage enabled the Service to monitor developing
trends within the violent racist movement as well as to warn of potential
public confrontations involving violence... "
CSIS information primarily from [the Source] led to the arrest and deportation
of a number of leading international white supremacists:
CSIS also provided information to the police which led to the arrest
of Ken Barker, a Heritage Front member, who was charged with armed robbery.
Since 1989, CSIS has produced over 80 threat assessments on the activities
of white supremacists.[16] We have provided
advance information to police and government officials on the potential
for violence at demonstrations and other events.
In addition, the Service has produced 10 detailed CSIS Reports on the status
of the white supremacist and organized racist community in Canada."[17]
The Source also provided police with information that may have saved individuals
from harm. For example, the handler told police about a Skinhead plot to
disrupt an anti-racist march by hurling bottles and rocks from downtown
Toronto rooftops. Police subsequently manned the rooftops. He frequently
reported on activities involving guns and other weapons, providing information
which was passed to the Metropolitan Toronto Police Force.
The handler was asked about the value of the operation. He indicated that
he saw it as having severely damaged the right wing in Canada and the USA
and "they know it". He stated that the organization is
turning in on itself. He added that if an organization like The Order in
the United States had started up in Canada, CSIS would have been in a position
to know about it.[18]
We do not know for sure that the Source was the direct cause of the arrest
of any HF members. According to the Metropolitan Toronto Police, however,
in 1993 they and the Ottawa Police arrested about 15 members of the HF
and the Church of the Creator (COTC) for various offenses.[19]
There is no indication that CSIS consciously provided funding for the
creation, development or nurturing of the Heritage Front. Indeed, CSIS
Human Source files suggest that CSIS officers never discussed the impact
of funding on the growth of the Heritage Front.
There is no way of determining objectively if the Source was overpaid.
However, only about $79,000 was paid for information, the rest being for
expenses, and loss-of-employment compensation.
The Source was paid at the rate of $30,000 annually for fifteen months,
in compensation for losing his job. This payment was based on an estimated
employment income of $41,000.
Service accounts suggest that expense monies from the Service were by and
large not spent on other Heritage Front members; though some money was
most certainly spent for shared vehicle expenses and the like. The CSIS
financial records indicate that CSIS never paid for airline tickets for
other Heritage Front members.
We do not know, with certainty, what the Source decided to do with the
money he obtained from CSIS. He and his handler indicate that he was a
penny pincher, and had substantial bills to pay.
The Source said that he made minor contributions and donations to the Heritage
Front. Service financial records, however, contain no entries for donations
and contributions.
1 In a few cases, the Source would make no claims for a month.
2 "Source Financial Statement", April, 1989.
3 SIRC interview of Source
4 SIRC interview of Source
5 SIRC interview of Source
6 SIRC interview of Source
7 SIRC interview of Handler
8 SIRC interview of Handler
9 SIRC interview of Investigator
10 SIRC interview of Source
11 We have detailed expenditures and receipts for 1989 and 1990.
12 Correspondence from CSIS, November 18, 1994.
13 SIRC interview of Handler .
14 SIRC interview of Source.
15 SIRC interview of the Metropolitan Toronto Police Force.
16 According to the Service, "while it is not possible to quickly
attribute the contents of specific assessments to [the Source], the intelligence
from this individual is seen as a significant contributor". Staff
estimates that about half derive from, or are likely to derive from, the
Source.
17 "Value added", undated.
18 SIRC interview of Handler
19 SIRC interview of the Metropolitan Toronto Police Force.