He was re-elected in the 1997 election against a strong challenge from the Reform Party,[2] and served as parliamentary secretary to the Minister of Indian Affairs and Northern Development from July 1998 until 2000.

In this capacity, he called for the creation of a federal ombudsman with the authority to levy fines against major banks that cut off credit to small businesses without due cause.

[7] He served on a Liberal caucus task force on financial institutions in 1998, and supported its conclusion that two proposed major bank mergers would be against the interests of Canadians.

[11] Iftody said that he did not support discrimination and denied being part of a parliamentary "God squad", but nonetheless expressed a personal view that homosexuality was "spiritually unhealthy".

[16] He also criticized Shell Oil for its human rights record in Nigeria, claiming that the company had violated "the elementary standards of the international code of conduct for business" by failing to intervene against government abuses.

In 2003, Providence College and Theological Seminary in Otterburne began an annual series called the David Iftody Memorial Lectures.