The RCMP is investigating allegations of fraud, breach of trust and money laundering by three senior managers of the Ontario Provincial Police union, search warrant documents show.
The information comes from an affidavit used by the RCMP to obtain search warrants and has not been proven in court. None of the managers named in the court documents has been charged with a criminal offence.
But the RCMP believe senior managers at the Ontario Provincial Police Association were involved in:
- The unusual investment of union money in condos in the Bahamas.
- The formation of a company to provide exclusive travel services for both union business and personal travel by members
- The formation of a consulting company to advise the union about investments, including a three-year deal that would bill the union $5,000 a month.
- Questionable vacation and travel expenses billed to the union, in some cases totalling more than $100,000 a year.
The affidavit focuses on the dealings of three senior managers of the union, which represents more than 6,200 uniformed and 3,600 civilian members of the OPP.
The RCMP probe began last October following complaints by union staff alleging fraud.
The three senior managers named in the documents are:
- President James (Jim) Christie.
- Vice-president Martin Bain.
- Chief administrative officer Karl Walsh.
In addition to their management roles with the Ontario Provincial Police Association, or OPPA, all three are also OPP officers. Christie holds the rank of detective-sergeant while the other two men are constables. Walsh ran unsuccessfully for the provincial Liberals in the Barrie riding in 2011.
The documents also focus on the managers' business dealings with Toronto lawyer Andrew McKay.
Last week, the RCMP raided the union's head office and Christie and Bain took voluntary leaves of absence, while Walsh was been placed on administrative leave. A union statement issued at the time said the managers' leaves should not be considered an admission of wrongdoing.
The RCMP affidavit alleges union managers "have organized various schemes, some of which include companies for which they hold hidden beneficial ownership that have been set up in order to obtain exclusive rights for services required by the OPPA. These services pertain but are not limited to the travel and investment needs of the OPPA."
The affidavit was written by RCMP Sgt. Gordon Aristotle, an officer with a background investigating fraud.
The dealings the RCMP says it uncovered include:
Setup of First Response Travel Group
Aristotle says First Response Travel Group was formed in June 2014. According to the documents, Walsh then "directed all OPPA employees to use this company exclusively for OPPA travel needs," including travel arrangements for the union's annual golf tournament and other union events. Total value of the contact was estimated at $400,000.
The documents also allege the decision to move all union travel to First Response was made "without cause or explanation." The company was also promoted to union members for their personal travel though the union's website and its magazine Beyond the Badge.
Citing internal emails, the documents suggest that Walsh, Christie, Bain and McKay "all owned shares in First Response" but did not disclose it to the union's board of directors or members. The documents also say the company's ownership was not disclosed to the union's auditor.
The RCMP documents state that First Response is a division of Leximco, a corporation which lists McKay among its directors.
Police say they were told by witnesses that union management made high-risk investments in real estate properties in the Bahamas. "This has been a noticeable deviation from the historically conservative investment strategy of the OPPA," the documents say.
According to the documents, Walsh charged a $20,000 deposit for the purchase of two condo properties to his union credit card. One of the properties was valued at $1.5 million, the other at $625,000. According to the search warrant documents, the purchase was not discussed with union board members and "did not make sense to some of the OPPA employees as the OPPA is a non-profit organization."
The documents say the deposit for one of the condos was "made in Walsh's personal name, with an associated mailing address belonging to McKay's office." The documents also state that McKay twice travelled to the Bahamas with Walsh and Christie in 2014.
PIN Consulting Group
The documents allege this company was set up in June 2014, 10 days before First Response, with McKay listed as the only director and his assistant listed as the company's contact person. Walsh and Christie signed a three-year contract with PIN on behalf of the union to provide consulting work on real estate and commercial investments and "vacation property opportunities." Under the contract, the union would be billed $5,000 a month for this work plus expenses over a period of three years.
Witnesses who spoke to police allege the union managers named in the documents made fraudulent claims for vacation leave payouts and personal expenses. In the search warrant documents, the RCMP say witnesses alleged Walsh, Bain and Christie claimed an aggregate amount of $144,000 in excess of their salaries for the fiscal year ending in 2014 and were paid out $100,000 in excess of their salaries for the fiscal year ending September 2013.
A summation of the RCMP probe alleges investigators uncovered complicated dealings by Walsh, Bain and Christie intended to skim union funds for their own profit:
"The totality of the alleged behaviour demonstrates an ongoing breach of trust... that has escalated in sophistication and significance to the point where they are now believed to be using a lawyer, a nominee, a consulting firm, a travel company, an offshore company and offshore investments to profit and deceive the OPP membership."