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Deputy Prime Minister and Minister of Finance Chrystia Freeland testifies at the Public Order Emergency Commission in Ottawa on Nov. 24.Spencer Colby/The Globe and Mail

Canadian bank CEOs warned Deputy Prime Minister Chrystia Freeland on the eve of the federal government’s invocation of the Emergencies Act about risks to the country’s reputation, saying that Canada was being called a “joke,” as several key border crossings remained blocked by protesters.

Another chief executive relayed the comments of an investor, who had said, “I won’t invest another red cent in your banana republic in Canada.”

Meeting minutes from the Feb. 13 call were tabled Thursday with the inquiry studying the federal government’s invocation of the Emergencies Act last winter. The leaders’ names are redacted in the minutes, but separate notes by Ms. Freeland from the same meeting refer to each CEO by their first or last name.

The CEO’s comment is attributed to “Darryl/BMO” in Ms. Freeland’s notes, likely a reference to Bank of Montreal CEO Darryl White.

“If the investor you speak of is American, tell them we are not like the USA who had people literally invade their legislature,” Ms. Freeland told the CEOs, according to the minutes. “If they are a Brit, remind them of Brexit. If they are French, remind them of the Yellow Vests. If they are German, look at how badly they are handling Russia right now.”

The federal government invoked the Emergencies Act one day after Ms. Freeland’s meeting with the CEOs. It was revoked on Feb. 23. Other documents tabled Thursday show on Feb. 20, RCMP Commissioner Brenda Lucki believed there was an “operational need” for the powers under Emergencies Act and suggested that they stay in place for an extra two to three weeks.

Opinion: Don’t bet on the Emergencies Act inquiry hurting Trudeau

After six weeks of testimony from dozens of witnesses, the Public Order Emergency Commission’s public hearings are ending with the appearances of the country’s most senior cabinet ministers. Its final witness will be Prime Minister Justin Trudeau on Friday. The central question the commission is seeking to answer is whether the federal government acted lawfully when it made use of the act’s immense powers, including freezing bank accounts without a court order.

The government has declined to release the legal opinion it received on this central question. Still, texts, notes and e-mails from the time show the state of mind and personal opinions of Canada’s leaders during the protests.

Documents released through the inquiry show that in a Jan. 30 call Mr. Trudeau described the protests in Ottawa as “a lot of hateful rhetoric going on.” During a Feb. 11 call with a union leader the Prime Minister said the protesters were calling for the overthrow of the government or policy changes “based on false facts.” He also criticized the police saying they were “caught with an old playbook.”

In testimony on Thursday, Ms. Freeland argued that economic threats – such as the trade-jamming blockade of the Ambassador Bridge in Windsor, Ont. – can also be considered a threat to national security. To invoke a public order emergency, as the government did, a threat to national security must exist.

She testified that the CEO’s comment about a banana republic was “heart-stopping” for her and described it as crystallizing her understanding that the protests were “profoundly jeopardizing” the Canadian economy.

Ms. Freeland testified about her meeting with the bank CEOs, who are some of Canada’s most powerful business leaders. The meeting took place just hours before a cabinet meeting to discuss the possible use of the Emergencies Act. Some bank leaders made clear they wanted the government to take extraordinary measures to end the protests but also raised questions about the government’s COVID-19 restrictions.

Two CEOs floated the idea of the government designating the protests as a terrorist group so that the banks could seize their assets, according to the minutes and Ms. Freeland’s notes.

“Label them as terrorists,” reads a comment in Ms. Freeland’s notes. It is attributed to “Darryl/BMO,” likely Mr. White. Comments attributed “Dave” in her notes – which could reference Royal Bank of Canada’s Dave McKay – echoed that sentiment and added, “seize the assets and impair them.” Meantime, another CEO suggested using the “military at the borders,” according to Ms. Freeland’s notes. The comment is attributed to “Dodig,” likely Canadian Imperial Bank of Commerce CEO Victor Dodig.

On the flip side, Ms. Freeland was also pressed to start looking beyond the pandemic.

Her notes show that one CEO urged the government to begin focusing on the “post-pandemic econ.” Her notes attribute this to “Laurent F.,” likely National Bank CEO Laurent Ferreira.

According to the minutes, in addition to talking about a postpandemic economy, an unnamed CEO also noted that Canada has the “greatest restrictions” among countries in the Organization for Economic Co-operation and Development (OECD). That same CEO said the government needs to “show a plan for how to remove restrictions,” it adds.

The same leader expressed concern that if banks were directed to close accounts, it could be seen as the sector “being used as an arm of the government” and feared the sector being seen “as a political weapon of the government,” per the minutes.

Earlier in the meeting, a leader said they’d been “taking a big reputational hit,” adding, “Fox News is telling people to take their money from us.” Ms. Freeland confirmed in testimony this referred to backlash against Toronto-Dominion Bank after it froze an account of a convoy organizer who’d raised funds for the protests.

The Globe and Mail contacted every bank named in the notes from Ms. Freeland, but they declined to publicly comment about the meeting.

Ms. Freeland closed the meeting saying the government was looking at all options, including some that “in normal times would be seen as draconian.”

Her testimony and later testimony from Mr. Trudeau’s chief of staff Katie Telford, deputy Brian Clow, and policy director John Brodhead underscore the government’s behind-the-scenes scramble to manage the blowback from the White House after protesters jammed a crucial border crossing.

On Feb. 10, Ms. Freeland spoke with Brian Deese, a high-level adviser in the Biden administration. In an e-mail summarizing that conversation, Ms. Freeland wrote, “they are very, very, very worried.”

“He said that he supposed that this proved the point we had made previously to them about how closely integrated our economies are. (He did not seem to see this as a positive.),” Ms. Freeland wrote.

By that time the Ambassador Bridge had been blocked for four days. It was cleared and reopened to traffic in the early morning hours of Feb. 14 – before the Emergencies Act’s invocation.

Ms. Freeland testified that for the first time she saw the Americans looking at their supply chains with Canada as a vulnerability.

In an interview with the inquiry ahead of her testimony, Ms. Freeland argued that “a very serious threat to Canada’s economic security can constitute a threat to national security.”

The Emergencies Act states that to declare a public order emergency, there must be “threats to the security of Canada” that are so serious they mark a national emergency. The act’s definition of those threats comes from the Canadian Security Intelligence Service Act. The CSIS Act outlines four types of threats to the security of Canada. None makes reference to the economy.

The commission’s co-lead counsel, Shantona Chaudhury, asked her about how economic security is tied to a threat to national security, noting that it is “not necessarily obvious” in the legislation.

Ms. Freeland didn’t point to a legal justification for her assessment but said: “If our economic security is threatened, all of our security is threatened.”

She also pointed to Russia’s invasion of Ukraine as an example of “economic tools being weaponized in actual wars.”

Her justification for the act’s use closely mirrored testimony from other government officials which has omitted the legal reasoning, leaving it behind the veil of solicitor-client privilege. In a statement Thursday, Cara Zwibel, a lawyer for the Canadian Civil Liberties Association, said “economic harm” is not grounds for the invocation of the Emergencies Act.

“With just one day of testimony left, the government is running out of time to prove it met the high burden of invoking the Emergencies Act,” Ms. Zwibel said.

Evidence presented on Thursday also highlighted discussions around how and when to revoke the act.

Internal notes show that despite the reservations Commissioner Lucki had before the Emergencies Act was invoked, she strongly supported it once it was in place. Her speaking notes for a Feb. 20 cabinet committee meeting says that based on the situation in Ottawa “there is an operational need to maintain access to these powers” to “finish what we started.”

She goes on to argue that the extra powers were being leveraged by police to “deter, disperse, and decrease protests” at border crossings and key sites.

Mr. Clow said that he doesn’t recall whether Commissioner Lucki expressly made those comments at the Feb. 20 meeting. But he said there was a clear message from the RCMP “right up to the revocation” on Feb. 23 “that the RCMP believed that the powers were critical.”

“They argued that they should stay in place for a period longer, in order to prevent additional blockades from starting or from people from returning to the ones that existed,” he said.

Four days after the act was invoked, Public Safety Minister Marco Mendicino texted Ms. Telford: “Just got off phone with president of [the Canadian] Association of Chiefs of Police. He offered to write me a letter of support invoking Emergencies Act, and how it’s helping police enforce against the blockade. I said that would be much appreciated,” he wrote.

“Excellent,” Ms. Telford replied.