Quebec developer alleges corruption sank Alberta project
Alberta town official demanded kickbacks, Quebec developer says
Posted: Dec 13, 2012 5:21 AM ET
Last Updated: Dec 13, 2012 8:30 AM ET
A Quebec property developer who fled the province hoping to break away from industry collusion says he was left nearly destitute after refusing kickback demands from an official in small town Alberta.
A joint investigation by Radio-Canada's investigative program Enquête and the Toronto Star into the dealings in the town of Lamont, Alta., has shed light on allegations of industry corruption that span far beyond Quebec's borders.
"In Alberta, when you don't hear about corruption and collusion it's not because it's [not] taking place," said developer Gilles Filiatreault.
"Nobody talks about it.…Town's representatives, politicians are just walking away or keeping silent. Every time you keep silent on that kind of story, you make it easy for the next guy."
In 2006, Filiatreault decided to sink his money and reputation into a massive residential development in Lamont, located about 60 kilometres east of Edmonton.
'Town's representatives, politicians are just walking away or keeping silent. Every time you keep silent on that kind of story, you make it easy for the next guy.'—Gilles Filiatreault, developer
He alleges that it ultimately fell apart because of his refusal to pay kickbacks to the town's chief administrative officer. The town and administrative officer have always denied asking for the kickbacks.
Filiatreault filed a lawsuit against the town. The town filed a countersuit. In the meantime, Filiatreault says, he hit financial and emotional bottom.
But that's when things took a bizarre turn.
Tom Miller, the chief administrative officer, was fired by the town in 2011, a move the council claims had nothing to do with the kickback allegations.
In October 2012, 10 months after he was let go, Miller met with Filiatreault, who secretly recorded the conversation.
That recording captured the ex-official offering to forge a backdated document on city stationery that guaranteed the town would renew all the company's contracts for a year.
But it was an offer conditional on his signature to an illegal agreement that would see Miller get 50 per cent of any money awarded in the suit and 50 per cent of his company.
"It's a letter I have made, but I will testify that it's true. We know that it's all bullshit, OK? But what do you got? If we don't do that, what do we got?" Miller, the former town official, is heard saying on the recording.
Miller has denied any wrongdoing. When confronted by journalists from Enquête and the Star in November, he refused to answer questions about the recorded conversation.
"It's not true. I didn't say that," Miller told them. In a later phone conversation, he said he was advised not to speak about it.
No criminal charges have been filed against Miller.
Opportunity out west
The story started in 2004, when Filiatreault, who spent decades working in Quebec's residential and commercial construction industry, said he'd had enough of corruption there.
"We were approached always to have bribes or fees for people, and I was tired of that," he said.
"I was telling my wife, I'd like to go and build somewhere else where people appreciate our work, appreciate working with nice people and just do nice projects as it should be."
Seeing opportunity in the flood of jobs in Alberta, Filiatreault decided to leave Quebec and head west.
His company, Jabneel Development, signed a multimillion deal with the town of Lamont to build 1,200 units in a town that only had a population of 1,700 at the time.
The prospect for the project was bright, particularly because of its location and the province's rapidly growing demand for housing. Filiatreault said sales were swift and he had more than $11 million in residential and commercial sales commitments.
That all changed, the developer alleges, when a familiar situation arose.
In court documents filed in Alberta, Filiatreault claims Miller approached him and asked for a five per cent commission on all sales in the development.
He ignored the request at first, but alleges Miller threatened to drown the project in delays if the commission wasn't paid.
Filiatreault refused to pay and went to his lawyer, who advised him that handing over the money would amount to an illegal kickback. But he was financially tied to the project and he couldn't simply walk away.
That's when the development started faltering.
The company was hit with a stop-work order and other delays. The project ground to a halt just as the financial crisis hit in 2008.
The developer filed a complaint with the RCMP in December 2008 alleging that Miller had tried to extract a bribe, but the police dismissed the case, citing a lack of evidence.
Both Filiatreault and the town filed lawsuits claiming the other was at fault for the failure of the development.
Filiatreault's $28-million suit claim accused Miller of demanding kickbacks and alleged the town was guilty of improper conduct.
The town filed a $1-million counter claim alleging that the company was insolvent and wasn't competent to take on such an extensive project.
With all of his money sunk into the dead project, his lawsuit still working its way through the courts and outstanding debts to investors and tax collectors, Filiatreault returned to Quebec.
He moved into a modest home and struggled to support his two sons, who were studying in university, and his ill wife. He refused to give up the fight and filed a series of complaints.
Late last year, after closed-door meetings by the town's council and a request to Alberta's Municipal Affairs Ministry to look into the management of the project, the town fired Miller without releasing any details.Of the 1,200 units planned for the Lamont, Alta., development, only one home was ever built. (Enquête/Radio-Canada)
Town Mayor Bill Skinner denies that the dismissal had anything to do with the kickback allegations and wouldn't make any connection between it and the request for a ministry investigation.
It was just before that time that Filiatreault got a call from his one-time adversary asking for a meeting. According to witnesses who signed sworn statements, Miller knew he was about to be fired and wanted revenge against the town.
It was at a second meeting with Miller that Filiatreault brought a recording device.
"I think we can all benefit and really that's what it's all about," Miller is heard saying on that recording.
"You've been shit on. I've been shit on. It's time for us to get paid now."
To date, no one from the ministry has been named to look into the file, a delay a spokesperson attributed to the provincial election earlier this year.
Looking for 'justice'
In the end, only one of those 1,200 homes in Lamont was ever built.
Filiatreault says he never envisioned that his attempt to run a clean business, a decision which he said made him leave Quebec in the first place, would have led him to this point.
"It's 10 per cent of my lifetime and it's the best years," he said. "What I want is justice to be made in Lamont. I want our lawsuits to be listened to by a judge. I want someone to say, 'You were right and someone was wrong.'"
The RCMP has reopened the case, based on recordings handed over by Filiatreault. No charges have been filed.
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