After days of tracking by Canadian and US authorities, the navy boarded the MV Sun Sea after the cargo ship appeared to veer from its expected destination in the Vancouver area, authorities said.
The HMCS Winnipeg "attempted to hail the Sun Sea several times and, after establishing communications, the vessel declared that it had refugees on board," Public Safety Minister Vic Toews said, as quoted by public broadcaster CBC.
The Thai-flagged ship's skipper said that some 490 refugees were onboard, but Canadian authorities are unsure of their identities, Toews said.
Some of the people on the ship are "suspected human smugglers and terrorists," Toews said.
Toews pledged that Canada would prosecute anyone involved in human trafficking, which he denounced as a "despicable crime.
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Canada and other Western nations have been critical of Sri Lanka's human rights record but consider the Tamil Tigers, known for their suicide bombings and child soldiers, to be a terrorist organization