Manitoba·CBC Investigates

Arson call leads police to stumble upon charred construction documents in Caspian warehouse

Winnipeg police responding to a fire in a Transcona industrial building last spring discovered scorched documents the RCMP scooped up as part of their fraud investigation into Canada Post's Winnipeg mail-processing plant.

RCMP seizes boxes of construction invoices related to Canada Post plant already under investigation

The construction of Canada Post's mail-processing plant is under RCMP investigation.

Winnipeg police responding to a suspicious fire in a Transcona industrial building made an unusual discovery — boxes of scorched documents that the RCMP later scooped up as part of their fraud investigation into Canada Post's Winnipeg mail-processing plant.

On a rainy Sunday in June 2016, Winnipeg firefighters responded to reports of smoke inside a mostly vacant, 150,000-square-foot Regent Avenue  building that once served as a sales outlet for Canada One RV.

The structure is owned by a numbered company controlled by Armik Babakhanians, the president of Caspian Construction, the company at the centre of RCMP investigations into construction of the $100-million-plus Canada Post facility near Richardson International Airport and the $214-million Winnipeg police headquarters. Caspian was the contractor hired for both jobs.

Arriving at the scene in Transcona just before noon, firefighters found signs of a break-in and asked the Winnipeg Police Service to investigate what appeared to be a suspicious fire.

About three hours later, Winnipeg police arson investigator Det. Sgt. Kathy Antymis called up one of the RCMP officers assigned to the Mounties' investigation of the construction of the police headquarters and the Canada Post mail-sorting facility.

The RCMP received permission from a judge to hold on to mail-processing-plant construction records such as this invoice, marked "inflated." (RCMP)
Antymis told Sgt. Breanne Chanel that city police found something in the building of sufficient interest to warrant the RCMP investigator to take her own tour of the property in the company of a Winnipeg police officer.

"On the 2nd floor I observed what appeared to be a room filled with cardboard boxes. Some were on shelves, others were on the floor and appeared to be partly burned," Chanel said in a sworn affidavit provided to a judge in order to obtain a search warrant for the building.

​"I observed a pipe and what appeared to be a sprinkler head above the burned boxes which appeared to have a wooden wedge placed under it. There was pooled water on the floor.

"I observed two rubber maid bins and a cardboard bankers box which contained numerous manila file folders which appeared to be filled with documents."

Binders marked 'true' and 'inflated'

The folders were marked "Winnipeg Mail Processing Plant," wrote Chanel, who had reviewed mail-sorting facility files seized by RCMP during a raid on Caspian Construction's McGillivray Boulevard headquarters in December 2014.

The files found during that raid, which was part of the police headquarters investigation, included two binders containing mail-sorting-plant invoices marked "true" and "inflated," Chanel alleged in her affidavit.

Chanel said she had met with Canada Post in February 2016 to review their construction contract with Caspian and look over change orders related to the project.

"The contracts indicated that concerning change orders, Caspian was entitled to claim true cost, plus 10% overhead and 10% profit. The review showed on some change orders, Canada Post is believed to have paid Caspian costs at an inflated rate, based on invoices which are believed to have been altered," Chanel wrote in an affidavit attached to an August 2016 court order that allowed RCMP to hold on to seized material.

Firefighters responded to reports of smoke at this Transcona industrial building in June 2016. They suspected arson and called Winnipeg police, who notified RCMP of the presence of Caspian Construction documents. (Jaison Empson/CBC)
The information in the invoices led the RCMP to start a formal investigation of the mail-sorting facility, using some of the same investigators working on the police-headquarters investigation, Chanel said.

In court documents, the RCMP allege Caspian owner Armik Babakhanians and Caspian employee Pam Anderson defrauded Canada Post by submitting inflated invoices and false change-order and cost-breakdown sheets during the 2008-12 construction period.

The RCMP also allege Babakhanians and Anderson made "a false entry" with the intent to defraud the Crown corporation.

Caspian employee reported fire

"A person identifying herself as Pam Anderson" brought firefighters and ultimately police to the Babakhanians-controlled Regent Avenue structure last spring by reporting "a smell of smoke in the building," Chanel's August 2016 affidavit said.

The RCMP search of the Regent Avenue West building yielded "approximately 8 bankers' boxes of documents containing documents and records related to the WMPP [Winnipeg mail processing plant] project," Chanel wrote in the affidavit.

She said police took steps to dry and preserve the materials, some of which were damaged by water during the fire. 

"A preliminary review of the records suggests they are records from Caspian's job folder for the WMPP project. The records appear to contain Caspian's record of invoicing and balancing of accounts with subtrades from this project," Chanel wrote in her affidavit.

Police went to an accessory structure at the Transcona property the morning after the fire. (James Rinn/CBC)
The RCMP intended to contact subtrades that worked on the Canada Post plant to seek witness statements and verify project costs, she wrote. Once records were collected from Caspian, Canada Post and the subtrades, the RCMP would compare the data and try to find explanations for discrepancies, she wrote.

Chanel expected the Canada Post investigation to take another six to nine months, she said in her August 2016 affidavit. She also said she anticipated "fraud and other related charges" would be laid at the end of the investigation. 

No charges have been laid so far and none of the RCMP's allegations have been proven in court.

Babakhanians and Anderson could not be reached for comment.

On the day of the fire, the Winnipeg Police Service said six of its officers were exposed to a hazardous chemical and required treatment.

The chemical exposure occurred while members were in the building. The Winnipeg Fire Paramedic Service's hazardous-materials unit was called in to treat the victims.

"As far as we know, there were no long-term issues," Const. Rob Carver said in an interview this week. "As a result of the fire, there was some chemical residue. We weren't able to determine what it was."

The exact cause of the fire had not been determined and no charges have been laid, he added, estimating the damage at about $15,000.

Carver cautioned against drawing any conclusions about the fire simply because Caspian documents were damaged.

"It's easy to kind of put two and two together and suddenly get five," he said.