INDEPTH: SPONSORSHIP SCANDAL
Who did, or knew, what
CBC News Online | March 2, 2006
Here's what Justice John Gomery's initial report said about some of the key players in the sponsorship scandal, which saw almost half of the federal program's $332-million budget go to Quebec-based advertising and communications firms with ties to the Liberal Party of Canada's Quebec wing between 1994 and 2003.
Jean Chrétien, former prime minister:
He launched the sponsorship fund as a way to raise the profile of the federal government within Quebec in the wake of the 1995 sovereignty referendum, and thus convince Quebecers that remaining in Canada was worthwhile.
"Good intentions are not an excuse for maladministration of this magnitude," Gomery wrote. "The prime minister and his chief of staff [Jean Pelletier] arrogated to themselves the direction of a virtually secret program of discretionary spending to selected beneficiaries, saying that they believed in good faith that those grants would enhance Canadian unity."
The report also said that their assumption that Chuck Guité would run the program properly in the absence of any administrative safeguards "was naïve, imprudent and entirely unfounded." It also outlined how Chrétien's intention to make contract awarding more fair, after years of Liberal firms being shut out while Brian Mulroney's Progressive Conservatives were in power, "was subverted almost from the very beginning" to ensure Liberal firms were at the top of the list of companies eligible for contracts.
Finally, the report said Chrétien kept most of his cabinet – including his then-finance minister, Paul Martin – in the dark about initiatives funded by first the unity reserve and then the sponsorship program.
Jean Pelletier, Chrétien's former chief of staff:
The report said Pelletier, for whom Chrétien was "personally" responsible because he was a political appointee, essentially acted as a cabinet minister as far as the sponsorship program was concerned, playing a key role in distributing funds to parts of Quebec where Chrétien perceived the separatist threat was particularly strong. "Mr. Pelletier failed to fulfill that responsibility, in that he did not give adequate direction to the subordinates in [Public Works] to whom he was delegating the task of administrating a new program."
Pelletier's denial that he directed which projects would get funding was ruled not credible, given that Guité produced a list in Pelletier's handwriting showing projects with dollar figures attached. Pelletier had testified that he just made some notes because Guité was not taking any during one meeting they had. "The proposition that Mr. Pelletier would prepare notes to assist Mr. Guité to remember what had transpired at a meeting is improbable and cannot be reconciled with the rest of Mr. Pelletier's evidence," Gomery wrote.
Gomery was also highly skeptical of Pelletier's insistence that he had no conversations with Guité about which firms should be used to deliver the funds and thus collect the hefty commissions and production fees. "It is hardly plausible that he and Mr. Pelletier would have studiously avoided any discussion or mention of the important question of which agency would be hired to manage the event or the project on behalf of the government."
Alfonso Gagliano, former public works minister, senior Liberal organizer in Quebec:
He had claimed that Guité ran the program and they rarely discussed it, let alone decided which projects would receive funding. "Contrary to his testimony to the effect that his participation was limited to providing political input and making recommendations about events and projects to be sponsored, Mr. Gagliano became directly involved in decisions to provide funding to events and projects for partisan purposes, having little to do with considerations of national unity," wrote Gomery. "The evidence is overwhelming that Mr. Gagliano was a hands-on manager who took a great interest in the sponsorship program and an active part in its direction."
Chuck Guité, Public Works bureaucrat in charge of sponsorship program from 1996-99.
This "man without scruples" comes in for a large chunk of Gomery's criticism, for breaking government tendering rules, for directing contracts to friends, for dealing harshly with a whistleblower, and for accepting consulting fees from Quebec advertising agencies after leaving government.
"With the support and approval of persons at the highest level of government, Mr. Guité was untouchable and beyond the control of [his managers at Public Works]," Gomery wrote. The commission chair describes a man who had "acquired a reputation as the person in the public service able to cut through red tape and achieve results rapidly, without the usual restrictions and paperwork which are characteristic of a normal bureaucracy, but which are generally deemed necessary for the prudent administration of public funds."
When a subordinate dared to balk at being told to ignore the usual guidelines for preparing contracts, Guité found a way to declare his job "surplus," Gomery said. The employee filed a grievance and was reinstated in a different job, but Guité was never reprimanded although the department acknowledged he had acted inappropriately.
At least two of the advertising firms that received major sponsorship contracts were headed by close friends of Guité, Gomery wrote: Communication Coffin, headed by Paul Coffin, and Gosselin Communications, owned by Gilles-André Gosselin. They were among the five agencies that received the lion's share of sponsorship funding in Quebec, in large part thanks to Guité. "Those five agencies were contributors to the Liberal Party of Canada, some with greater enthusiasm and generosity than others," Gomery wrote. "After one of them, the Gosselin agency, became reluctant to make further political contributions, it received a sharply diminished share of sponsorship contracts."
After he retired in August of 1999, Guité went on to form a company of his own, Oro Communications Inc. Within its first three fiscal years, wrote Gomery, Oro took in more than $1 million in consulting fees, mostly from companies associated with sponsorship contracts or his former political masters.
Jean Brault, president of Groupaction Marketing Inc.
His company and its subsidiaries managed $89.5 million worth of sponsorship projects, allowing the company's net revenues to rise from $314,000 in 1994 to almost $1.5 million five years later, at the height of the program, the forensic audit conducted for the inquiry found. Brault and his wife drew salaries of almost $4 million between 1992 and 2001, and collected dividends of $2.7 million.
"Mr. Brault provided a refreshing contrast to the sorry spectacle offered by the witnesses who preceded him," wrote Gomery, saying he found Brault's testimony to be "entirely credible," frank and precise. Frankness aside, the commission chair blasted Brault's business ethics and practices, especially when it came to making unrecorded cash contributions to the Liberal Party of Canada's Quebec branch. "Mr. Brault sought to purchase political influence to obtain more lucrative sponsorship contracts. These motives were improper."
Among other things, Brault admitted to paying salaries to Liberal party workers who never actually did any work for his company and being involved in the production of a $550,000 report that didn't exist when reporters covering the emerging sponsorship scandal later asked about it.
On March 2, 2006, Brault pleaded guilty to five of six fraud-related charges.
Jean Lafleur, former president of Lafleur Communication Marketing.
He and his firm got more than $36.5 million in commissions, fees and costs because of the sponsorship program, while the projects and events being funded through his firm got only about $26 million.
"Mr. Lafleur obviously believes that entertaining lavishly is good for business," wrote Gomery. Sumptuous meals, Grand Prix tickets and salmon fishing trips were offered to politicians and public servants during the operation of the sponsorship program. At the same time, Lafleur donated generously to the Liberal Party and urged his workers to do the same, reimbursing at least two of them for doing so.
Gomery found Lafleur "evasive" during his testimony, saying, "It was obvious that the commission was hearing a witness who was prepared to appear to be slow-witted rather than to give truthful answers."
Lafleur was arrested in April 2007 and faces a 35-count fraud indictment over allegations related to 35 contracts worth $1.6 million. The fraud allegedly happened between 1996 and 2001.
Jacques Corriveau, president of PluriDesign Canada Inc. and former Liberal fundraiser.
Gomery described him as "the central figure in an elaborate kickback scheme by which he enriched himself personally and provided funds and benefits to the [Liberal Party of Canada-Quebec]." He seems to have linked up advertising companies with the people awarding the lucrative sponsorship contracts, and in return received subcontracts from the ad agencies. Some of the money he received as a result stayed in his own pockets, and the rest went to the Quebec wing of the Liberal Party.
"Mr. Corriveau was in effect acting, without being registered, as a paid lobbyist," Gomery wrote.
Guité first met Corriveau in 1994 or 1995 in the office of former public works minister David Dingwall, Gomery recounts. Before escorting him to Corriveau, Dingwall told Guité he was about to meet "a very, very close friend of the prime minister" and added: "If you ever find someone in bed between Jean Chrétien and his wife, it will be Jacques Corriveau."
Corriveau's firm hired Chrétien's son at one point, and his printing company did work for Liberal candidates in the 1993, 1997 and 2000 campaigns.
Gomery does not seem to have believed Corriveau's explanation that he could not remember much about the delivery of the sponsorship program or his business transactions because of the lingering effects of anesthesia he received during surgery in November of 2004. The report says that "serves as a convenient excuse for selective memory lapses," given that Corriveau "chose not to file a medical assessment or certificate to support his opinion."
^TOP
|
|
 |
 MENU |
|
|
| EXTERNAL LINKS: |
|
|
| MORE: |
|
|
|
Gilles Duceppe's response (RealVideo runs 5:59)
CBC does not endorse and is not responsible for the content of external sites. Links will open in new window.
