Jessica Davis is the president of Insight Threat Intelligence and the author of Illicit Money: Financing Terrorism in the Twenty-First Century.
Last week, the House of Commons unanimously voted to list the Wagner Group, a Russian private military contractor, as a terrorist entity. Unfortunately, this vote was completely symbolic.
On the surface, a terrorist designation might make sense. The Wagner Group is well known around the world for its mercenary activities. It is shoring up Russian operations in Ukraine, and is active in half a dozen countries in Africa, supporting many autocratic governments and conducting counter-terrorism operations against jihadist groups. Wagner recruits are often ex-military, but they have increasingly turned to the prison population to augment their dwindling recruitment base. As part of the group’s deployments, particularly in Africa, Wagner soldiers have reportedly committed a number of atrocities, which include extrajudicial killings by Wagner personnel in Mali and the Central African Republic. Wagner is also widely believed to be a direct foreign policy tool of the Russian government, and is likely instrumental in helping Moscow evade sanctions and support the Russian economy in the face of punishing international sanctions.
So the group certainly meets the technical definition of a terrorist entity, according to Canada’s listing process: Wagner personnel are believed to have committed terrorist activity by killing civilians in order to advance a political objective, either on behalf of their client state, or for Russia.
But Parliamentarians know full well that a vote is not how an entity becomes listed in Canada. Instead, our law enforcement and security services need to make a recommendation, based on investigations and analysis of both open and classified information, to the Governor in Council, who ultimately decides if an entity will be listed. While the legal threshold for designation is low, there is still a technical process that must be followed before a listing occurs and becomes law. In this case, that hasn’t occurred, and there is no indication of whether an actual listing will follow.
If parliamentarians are serious about stopping Wagner, they need to get serious about sanctions and foreign policy in Canada.
The Wagner Group and its oligarch founder, Yevgeny V. Prigozhin, are already currently sanctioned under Canada’s Special Economic Measures Act (SEMA). These sanctions prohibit, broadly speaking, financial transactions with Wagner, Mr. Prigozhin and his immediate family; they also freeze assets. However, there are a few problems with these SEMA sanctions.
First, Canada has a long track record of under-funding and under-investing in law enforcement and intelligence agencies’ ability to investigate, prosecute or otherwise disrupt sanctioned individuals in Canada. In 2022, the federal government announced more resources for sanctions enforcement, but given the rate at which Ottawa deploys its sanctions tools, and the slow recruitment process for this specialized area, this is far too little, and almost certainly too late.
The second problem is the actual structure of Wagner itself. Wagner Group is an unincorporated entity, essentially a web of dozens of different companies (that we know of). None of these companies are currently designated as part of Canada’s SEMA sanctions against Wagner. If Canada wants to effectively sanction the Wagner Group, it needs to list these companies, dedicate resources to uncovering more of this web, and add those companies to the sanctions list. While we don’t know if there is much financial activity by Wagner or Mr. Prigozhin happening in Canada, the only way to stop it is to do the work of investigations and analysis to uncover it.
The third is Canada’s aid programs. We currently provide aid to several Wagner client states, such as Mali and Mozambique, and unfortunately, money is fungible, which means any funding provided by Canada to these countries frees up funds that they can use to pay Wagner; those bills are substantial, as the reported US$10-million-per-month fees charged to Mali’s government indicate. So if Canada is serious about treating Wagner as a terrorist group, the government should send these states a diplomatic protest note over their use of Wagner’s services, and tie future aid payments to the termination of any relationship with the group. Otherwise, by our own measures, Canada could be seen as indirectly financing terrorism.
The government should be commended for using its tools of financial warfare, as they are some of the stronger and more meaningful actions Canada can take in the international community. But without adequate funding, investment and attention, these tools are meaningless. Almost as meaningless as a vote to list Wagner as a terrorist entity in the House of Commons.