A former close associate of Brian Mulroney denied on Thursday allegations by Karlheinz Schreiber that he asked Schreiber to transfer money "for Airbus" into a Swiss bank account destined for the former prime minister.

Advisor Fred Doucet speaks with Prime Minister Brian Mulroney in this 1986 photo in Montreal. Karlheinz Schreiber told MPs on Thursday that Doucet had instructed him to funnel Airbus proceeds into a Swiss bank account destined for Mulroney. Doucet denied the charges.
(Canadian Press)

Fred Doucet, Mulroney's former chief of staff, said Thursday that Schreiber's accusations were false. "If requested, I am prepared to appear before the ethics committee. I will co-operate fully with the committee," Doucet added in a prepared statement released Thursday.

Schreiber, who made his third appearance before the House of Commons ethics committee, said Doucet asked him to transfer money to a Geneva account belonging to Mulroney's lawyer.

He said he believed the meeting took place in late 1992 or early 1993 at the offices of Government Consultants International (GCI), an Ottawa lobbying firm started by another Mulroney confidante, Frank Moores. Mulroney was still prime minister at that time.

Schreiber said he asked what the money was for and was "shocked" when Doucet told him it was "for Airbus."

"I said, 'What the hell does Brian Mulroney have to do with Airbus?'" said Schreiber. "[Doucet] said, 'Are you naive?'"

Airbus was the successful bidder in a $1.8-billion deal to provide new jetliners for Air Canada in 1988, beating out Seattle-based Boeing.

Schreiber said he then approached Moores, a former Newfoundland premier, to ask about Doucet's request and was told to leave the matter with him and not to talk about it.

"They told me I should stay away from this. It is in their hands and they look after Brian Mulroney."

Mulroney has denied benefiting in any way from the Airbus sale and won a $2.1-million settlement from the federal government in 1997 when his name was mentioned in an RCMP investigation into the sale.

The committee has recalled Schreiber for a fourth appearance on Dec. 11, while Mulroney will appear Dec. 13.

I would have signed anything: Schreiber

Schreiber's allegation was in a May 8, 2007, letter contained in one of several binders he gave to the committee on Tuesday. He said the binders included correspondence with Mulroney and Prime Minister Stephen Harper.

Schreiber warned in the letter that he was "prepared to disclose … that I was asked by Fred Doucet to transfer funds to your lawyer in Geneva (Airbus)."

"This is my last warning," Schreiber wrote to Mulroney, adding, "You asked me through my lawyers to commit perjury to protect you."

Conservative committee members on Thursday pointed out contradictory statements from Schreiber, quoting a July 2006 letter in which he clears Mulroney of any link to Airbus.

Schreiber repeated his earlier claim that former Mulroney cabinet minister Elmer MacKay advised him to write the letter so that Mulroney could take it to Harper in the hope it could help prevent his upcoming extradition to Germany.

Schreiber said that given the position he was in, he would have signed anything.

"I don't care what's in the letter. It's not my letter, it's his letter," he said.

Elmer MacKay has acknowledged helping draft a letter from Schreiber.

Schreiber said he believed Harper would launch an inquiry into his Airbus allegations as part of his 2005 election campaign pledge to clean up government.

The former arms dealer was released on bail Tuesday after being held in custody while waiting to be extradited to Germany, where he faces fraud and other charges. He's trying to launch an appeal to the Supreme Court of Canada to remain in the country.

$4 million success fee

The committee also heard more details about $300,000 in cash payments Schreiber gave to Mulroney during the early 1990s.

In his earlier testimony, Schreiber said the cash wasn't a kickback from the Airbus deal but involved a project to build light-armoured vehicles in Nova Scotia for his German client Thyssen.

On Thursday, Schreiber said his Liechtenstein-based company, International Aircraft Leasing (IAL), received a $4-million success fee after the Mulroney government signed an understanding in principle in 1988 to proceed with the tank facility in Cape Breton.

The $300,000 that Mulroney received was drawn from this success fee, he said.

The tank project, known as Bear Head, never went forward.

When asked why he and Mulroney dealt in cash and not by cheque or bank transfers, Schreiber said he expected Mulroney would eventually send him a receipt or bill him for his services. Schreiber said he never got a receipt and he never asked for one.

Schreiber said as far as he knows, Mulroney has never provided any services to him. When asked why he paid $300,000 without having seen evidence of any work, Schreiber would only say he believed Mulroney would make an effective lobbyist when he left office.

Questions about MacKay

Opposition MPs trying to link the Conservative government with the Airbus affair again questioned Schreiber about his relationship with Defence Minister Peter MacKay, the son of Elmer MacKay.

Schreiber said Peter MacKay worked for Thyssen in Europe when he was in his 20s as part of training to become an executive with the Bear Head armoured car plant.

MacKay has said he worked for Thyssen for a "very short time" and never met Schreiber.

Schreiber on Thursday praised his friendship with Elmer MacKay, but said he isn't on good terms with Peter MacKay.

"Allow me not to comment on his son. He is not the same timber and I do not wish to talk about it," said Schreiber.

With files from the Canadian Press