The CEO of the Enterprise Cape Breton Corporation is being investigated for "gross mismanagement" in allegedly hiring along Conservative partisan lines.

John Lynn is accused of using his position to hire three employees because they were connected to the federal Conservative Party.

Liberal MP Gerry Byrne of Newfoundland laid the original complaint. Mario Dion, the public sector integrity commissioner of Canada, said an investigation is warranted.

"I have determined that an investigation into this matter is warranted as I have reasonable grounds to believe that a wrongdoing was committed," Dion said in a June 10 letter to Byrne.

"My office will investigate Mr. Lynn’s involvement in four alleged staffing appointments at ECBC and his involvement in the alleged mismanagement of an ECBC-funded marina project."

Dion did not name any of the people whose appointments are under scrutiny.

Peter MacKay connection

Byrne welcomed the decision.

"ECBC has hired people who are obviously very directly connected to the Minister of National Defence Peter Mackay and it causes question not only with us here in Ottawa, but in the community at large in Cape Breton," he told CBC Monday.

The Atlantic Canadian Opportunities Agency oversees ECBC, which is a Crown corporation. ACOA said Monday that Lynn is on a personal leave of absence for an "unspecified period of time."

Byrne alleges Ken Langley, Robert MacLean and Alan Murphy, along with Lynn, are all good friends of Peter MacKay. All were hired for jobs with ECBC. Byrne says the jobs were never posted.

"With an organization like ECBC — which you know has a huge and positive track record — the most important thing is to get this investigation underway, to reach conclusions, and if there is a finding of wrongdoing, that it be corrected," Byrne said.

A spokesman for MacKay on Tuesday pointed to a separate investigation into questionable hiring at ACOA, which found no political interference.

"It has previously been found that neither the minister nor his political staff influenced any public service decisions," Jay Paxton wrote in response to an emailed request for comment on the ECBC investigation.

Dion said his investigation would be done "as expeditiously" as possible, but did not offer a date by when it would be concluded.