RCMP to investigate allegations of income trust leak
In the midst of a federal election campaign, the RCMP has launched a criminal investigation into the release of information by the Department of Finance, related to a government announcement on taxation of income trusts.
RCMP Commissioner Guiliano Zaccardelli confirmed the investigation in a letter to NDP finance critic Judy Wasylycia-Leis. "We would like to advise you that a review of this matter has been completed. Based on the information obtained during the review, the RCMP will be commencing a criminal investigation," he wrote.
On Nov. 23, the federal government announced just before 6 p.m. EST, it would cut the tax on corporate dividends and would make no changes to the tax on income trusts. That's the type of news that is always announced after stock markets close at 4 p.m. EST because it would give a boost to those types of securities.
But there have been allegations since that time that information about the changes was leaked early, allowing some in the know to profit from the information.
Trading in many trusts and dividend-paying stocks became much heavier than usual in the hour or two before the market closed on Nov. 23, and share prices rose sharply.
Forensic accountant Al Rosen told CBC News on Wednesday that he is convinced there was a leak of information. "I'm 90 per cent plus sure, but once again, in our business we have to be 100 per cent sure. And that is why the investigation is needed; to look at the volumes, the prices, at a whole cross-section of the trusts and the dividend paying stocks. And there's a third category of other stocks that will benefit from the trading," Rosen said in an interview with Newsworld Business News.
Wasylycia-Leis has called for Finance Minister Ralph Goodale to step down from his cabinet position while the investigation is underway. "Mr. Goodale is personally responsible to ensure his office and his department protect average Canadians from the consequences of improper disclosures," she said in a news release.
Conservative leader Stephen Harper also called for Goodale to step down. He told reporters in Prince Rupert, B.C. that Goodale's handling of the finance portfolio has been "brutally incompetent."
Goodale shot back that he was not going to submit to accusations from the opposition.
"There is no personal allegation of wrongdoing against me. I have looked at this situation very carefully and I am absolutley confident about my conduct in this matter and I do not see any basis upon which to resign," Goodale said Wednesday night in Regina.