North Of The Border

Last month, Canadian authorities arrested 19 foreign students suspected of ties to al Qaeda.

One of the students attended a Canadian flight school and liked to fly over the local nuclear plant. Others were apprehended outside a nuclear facility in the middle of the night.

With the second anniversary of 9/11 approaching, the arrests serve as a reminder that Canada and the United States share a 5,500 mile border that is largely unguarded.

As 60 Minutes first reported over a year ago, Canadian intelligence admits the country has become a sanctuary, staging ground and fund-raising base for hundreds of terrorists from all over the world.

They are drawn to Canada by its liberal immigration and refugee policies, and they have transformed Canada into a potential launching pad for attacks against the United States.Correspondent Steve Kroft reports.

“It's a convenient place. It's a modern economy so that you can get money, you can transfer money, channel it around the world.”

In the past decade, Canada has opened its doors to more than two million immigrants to keep its economy growing. They have settled into diverse, ethnic neighborhoods of Toronto, Montreal and Vancouver, where Arabic and Farsi are now as likely to be spoken as English or French.

Tens of thousands have come from Pakistan, Sri Lanka, Iran and North Africa -and some have brought their radical politics with them.

“We've established through our intelligence services and other means that we have 50 terrorist organizations now on our soil. And a good number of these are world class. They range in scope from the IRA to Hezbollah, Hamas … certainly al Qaeda,” says Harris, who believes that they are targeting the United States.

In January 2002, when Attorney General John Ashcroft announced that U.S. authorities were actively searching for two al Qaeda operatives, he acknowledged that both men had obtained Canadian citizenship.

Abderraouf Jdey and Fake Boussora were both born in Tunisia and have been identified as would-be suicide bombers. Both are still at large, carrying valid Canadian passports, and both of them lived here in Montreal, which has become a strategic center for international terrorists.

Law enforcement authorities in Canada and abroad believe at least 15 Islamic terrorists with connections to al Qaeda have operated here. Many are French-speaking North Africans who feel right at home in Montreal, the second-largest French speaking city in the world and just an hour's drive from the U.S. border.

“If you are in the business of destroying the Western world and the United States and everything that they represent, you couldn't have a better jumping off point, could you,” says Harris.

And the border is wide open.

Hani Al-Sayegh, a prime suspect in the 1996 bombing of the Khobar Towers barracks in Saudi Arabia that killed 19 Americans, was arrested in Canada.

Gazi Ibrahim Abu Mezer used Canada as an entry point to the United States in 1997, bringing with him plans to blow up New York City subways. He's now serving a life sentence.

Nabil Al-Murabh, considered one of Osama bin Laden's key operatives in North America, went back and forth across the Canadian-US border until he was arrested just after Sept. 11 with a valid license to haul hazardous materials.

All three were able to operate in Canada using the same method. They arrived and claimed to be refugees seeking political asylum. Under international law, a refugee is someone who has a well-founded fear of being persecuted in his native land, but Canada's interpretation is much more liberal.

Joe Bissett, a former executive director of the Canadian Immigration Service, says Canada never turns anyone away. “We have the most generous refugee system in the world,” he says. “Much too generous.”

And 44,000 people showed up in Canada in 2001 claiming to be refugees - 15,000 just since Sept. 11.

“Out of those 15,000, 2,500 come from terrorist countries: Algeria, Pakistan, Afghanistan, Albania, Somalia, Iraq, Iran,” says Bissett. “Now these people, 2,500 of them, are in Canada. Most of them, we don't know who the hell they are.”

And there is good reason they don't know who they are. Val Diaconescu worked as a senior immigration inspector at Montreal's Dorval Airport.

“While I was there, I can say 80 percent of the people coming to claim refugee status didn't have any documents,” he says.

Diaconescu says the refugees get out of their native countries using phony documents, and then destroy them in transit. And what happens when they get to Canada?

“The procedure is very simple. You have to fill the papers, pick up the--the fingerprints and the picture, and let the person go,” says Diaconescu, who says the whole process takes almost two hours.

Canadian authorities acknowledge that just 5 percent of the refugees coming into Canada are detained. The other 95 percent are released and told to show up for an immigration hearing that will be held sometime in the next year. Many, however, never bother to attend.

Take the case of Ahmed Ressam, an Algerian who hoped to celebrate the millennium by blowing up the Los Angeles Airport. He immigrated to Canada seeking political asylum in 1994, traveling with phony documents.

According to Stephen Gallagher, a political science professor at Montreal's Concordia University, the Ressam case is a textbook example of how easy it is to exploit Canada's immigration system. He says Ressam all but volunteered to immigration officials that he was a terrorist.

“When he arrived at the airport, he told them that he was accused of being an Islamic extremist, and that he had spent time in jail for - for selling arms, and yet the -- he was released,” says Gallagher.

Once in the country, Ressam began plotting attacks while he collected welfare and awaited word on his refugee claim.

“You have to realize it takes so long to get through the whole process that it's a good means of living in Canada for an extended period without--without actually being deported,” says Gallagher. “Once you’re here, you’re here.”

And getting full benefits. In fact, Gallagher says that Canada is the only country where, when you arrive, you can work, and in addition, you can collect welfare and health benefits. You can also enroll your children in school.

Ressam not only spent six years in Canada, he even left to travel to Afghanistan and back to attend a six-month terrorist training course. He never bothered to show up for his immigration hearing and was arrested several times for a string of robberies.

In the end, it was an astute U.S. Customs agent in Port Angeles, Washington, who caught Ressam with a car full of explosives. He is now in federal prison.

But according to former Canadian Immigration Chief Joe Bissett, that makes him an exception to the general rule.

“It's like - one of our commentators has said - The Eagles' song ‘Hotel California.’ Anybody can check in but nobody leaves,” says Bissett.

“They don’t leave. And we’ve had some cases that have been in the court for years and years, and some of them are convicted terrorists.”

Mohammad was sentenced to 17 years in prison in Greece, but was released as part of a prisoner exchange. He found his way to Canada 15 years ago using a fake name. After more than 40 court hearings, the Canadian government still hasn't managed to get rid of him.

“I was the head of immigration at the time. I remember it very well. That was in 1987. This guy is still here. He's free. He's running a little grocery store in Sullivan, Ontario, with his family. It's calculated that it's cost the Canadian taxpayer $3 million in court costs because he hasn't got the money,” says Bissett.

And the legal process is still going on.

Bissett says his government doesn't seem to have learned some obvious lessons from Sept. 11. Canada still has no travel restrictions on visitors from Saudi Arabia, which has been a hotbed of al Qaeda activity. In fact, Saudi citizens traveling to Canada don't even need a visa. They can just get on an airplane and fly to Canada.

“Get on an airplane if they've got a passport. They come into Canada and get off the aircraft. There's no pre-checking of them,” says Bissett.

“If they were concerned about security, they would have slapped a visa on Saudi Arabian visitors immediately after September the 11th.”

“Free and open societies are places where people are going to hide, and they hide in Canada,” says Manley. “They've hidden in the United States. They've hidden in Europe.”

Does he think the problem is Canada's overly generous immigration policy? Does he think Canada has a grasp on the people who are coming in?

“I think we have a grasp on them. As I say, is it fail-safe? I'd be naive to believe it was. Is it getting better? Yes. Do we need to keep improving it? Yes,” says Manley.

Since the 9/11 attack, Canada has allocated more than $200 million a year to improve screening of foreigners.

But many believe the problem is Canada's immigration policy, which last year admitted 250,000 immigrants on a permanent basis. Per capita, that's twice the number of immigrants being admitted to the United States.

In fact, the number of foreign-born Canadian citizens has grown so large over the years and become so well organized that no Canadian politician can afford to do or say anything that might appear to be anti-immigrant.

“The view has been that today's immigrant, today's refugee is tomorrow's voter for the party in power that let people in. So it's a fairly straight exchange in that sense,” says Harris. “It is purely politics.”

But Canada's independent auditor general isn't so sure, and has issued a report saying many problems still exist. On Friday, the FBI issued a world- wide bulletin on one of the Canadians mentioned in our story. The FBI says it has current intelligence that Abderraouf Jdey could be involved in an unspecified terrorist plot against the United States.