INDEPTH: SPONSORSHIP SCANDAL
Paul Coffin’s testimony
CBC News Online | April 27, 2005
 Paul Coffin waits to testify before the Gomery Commission Tuesday April 26, 2005 in Montreal. (CP PHOTO/Paul Chiasson)
Paul Coffin, head of Coffin Communications, admitted that he repeatedly produced fake invoices, over-billing the federal government for thousands of dollars for work that was never done on sponsorship projects. And much of it was at the request of the bureaucrat in charge of the program, Chuck Guité.
“I made it up,” Coffin told the Gomery Inquiry when confronted with invoices his firm produced for sponsorship contracts.
Coffin said he regularly sent phoney invoices to Public Works in Ottawa. He would bill for the full amount of the contract – even when the work didn’t justify it. On one occasion, he used up the entire production budget allotted to him to manage a $2 million sponsorship event, and over-billed by $11,000.
The revelations were made public Wednesday, April 27, 2005 after the publication ban imposed on his testimony, was lifted – with a few exceptions. The ban was imposed to protect Coffin’s right to a fair trial.
A self-made man who started in sales and graphic design at a young age, Coffin said he was always looking for a good deal. In 1997, he told Public Works his company had four employees while the only two employees were himself and his son, Charles. Coffin said he did this to embellish his proposal and increase his chances of getting sponsorship contracts.
“The right to exaggerate seems to be built in the advertising industry,” Justice John Gomery remarked with a sigh.
Coffin didn’t keep detailed timesheets until 2001 and often billed for creative work and graphic design. But all this work was done through freelancers and subcontractors, the inquiry was told.
When asked how timesheets were prepared before that, he answered a maximum of hours was always charged to show he had used up his sponsorship budget in full.
“Would you actually always invoice for the exact amount of the budget allowed?” asked inquiry lawyer Marie Cossette.
“Most of the time,” Coffin answered.
Coffin added he would bill for the full amount provided in the production budget, fabricating invoices along the way.
“As a matter of fact, it would appear that in 1998-99, and in 1999, and 2000-2001, the amount that was billed was precisely the amount that you were budgeted and you billed those amounts by creating timesheets or creating time records which in fact didn’t exist,” replied an exasperated Gomery.
“That’s right, Mr. Commissioner.”
Urged to provide details, Coffin said budget levels for sponsorship projects were decided by Chuck Guité, the bureaucrat in Public Works who ran the program, or his successor, Pierre Tremblay.
He said he would typically get a phone call at the end of the fiscal year from Huguette Tremblay, Guité’s aide, telling him there was money left in the budget.
“’Are you sending more invoices?’” he recalled her asking. “Whether we were expected to do it or not, we would do it,” Coffin said.
Coffin did advertising work for the federal government in the late 80s but his company’s profits really started ballooning after he started getting lucrative sponsorship contracts in the 90s.
In 1999-2000, Coffin earned $75,600 in commissions and $571,000 in production fees from sponsorship contracts. The federal government was Coffin’s biggest customer by far.
Coffin also testified that he had a very “friendly relationship” with Chuck Guité. They met in 1987 or 1988, he testified, when Guité was part of Ottawa’s Advertising Management Group. The relationship flourished. In the 90s, they went boating together, had get-togethers with their wives, and shared meals. In the fall of 1999, Coffin bought Guité’s 26-foot cruiser for $27,000. He made out two $13,500 cheques to Chuck Guité.
Gomery said he had “a hard time” believing that Guité and Coffin never discussed Guité’s key role in the sponsorship program after it was established in the wake of the 1995 Québec referendum.
“Mr. Guité is administering this program, yet, you don’t talk about it,” he fumed.
Coffin said he didn’t understand the “full scope” of the sponsorship program at that point but certainly benefited from it.
Contracts were untendered and competitions arranged, suggested Gomery.
Coffin said he remembered making a pitch to Public Works in April 1997 for a hefty sponsorship deal but could not say if he was already working on the contract before he got selected.
“So the winner of the lotto can’t remember the day he won the lotto prize,” mused Gomery, adding he was puzzled by Coffin’s lack of memory.
After Guité left the government in August 1999 and formed his own company, Oro Communications, he and Coffin had business dealings and were still on very friendly terms.
Coffin’s agency was involved with 80 sponsorship-related contracts worth a total value of $8.7 million.
Coffin is charged with 18 counts of fraud on 32 sponsorship-related contracts worth almost $2 million. His trial starts in early June in Montréal.
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Gilles Duceppe's response (RealVideo runs 5:59)
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