Panama Papers billionaire honoured at York U despite bribery case

A Canadian billionaire involved in a $400-million global bribery scheme encouraged students to be "good citizens" Monday as he received an honorary doctorate in Toronto from York University, which has remained steadfastly silent about what it knew of his past when it decided to give him the degree.

Dressed in purple and red academic robes, British-Canadian metals magnate Victor Dahdaleh received the honorary degree in front of hundreds of students at a graduation ceremony, where he referred obliquely to his legal troubles in recent years. He did not, however, mention the revelation, first reported by CBC and the Toronto Star last month, that his name and those of offshore corporations belonging to him come up dozens of times in the Panama Papers. 

• Panama Papers confirm Dahdaleh's role in bribery case
• Who's in the Panama Papers? Search the database here

"Try your best to be a good citizen," Dahdaleh said in his acceptance speech. "As I learned through personal experience in recent years, tough times will not last but tough people do... In times of adversity you always find out who your true friends are."

As reported by CBC and the Star, the Panama Papers confirm, as long suspected, that Dahdaleh is the mystery middleman known as "Consultant A" in a series of U.S. court documents that lay out a decades-long kickback scheme involving global aluminum giant Alcoa and government officials in Bahrain.

According to a 2014 plea deal between the U.S. government and Alcoa, Dahdaleh "facilitated at least $110 million in corrupt payments to Bahraini officials," including to a senior member of Bahrain's royal family and directors and management of the Bahrain national aluminum company. In exchange, Dahdaleh's client, an Alcoa subsidiary, secured contracts going back to 1989 to supply an ingredient in aluminum smelting.

The U.S. court documents say Dahdaleh used offshore companies based in the British Virgin Islands as intermediaries between Alcoa and Bahrain, with the companies marking up the price of the aluminum ingredient by $400 million over 20 years and Dahdaleh using some of that money "to enrich himself."

Approached by CBC and Star reporters Monday at York University before and after he received his honorary degree, Dahdaleh remained silent, not responding to questions about whether he is a good role model for the school's graduating students.

In the past, he has denied any wrongdoing and was acquitted in a British criminal trial in 2013, when the case against him collapsed because two key prosecution witnesses failed to show up to testify and another changed his evidence.

His defence never denied he paid the inducements to Bahraini officials but, under a U.K. criminal doctrine known as "principal's consent," said the payments weren't corrupt or illicit because they were known about and approved by the Bahrain government and were part of normal business practice at the time in the country.

The CBC and Star also approached York University president Mamdouh Shoukri outside Monday's ceremony, asking him whether Dahdaleh is a suitable role model for York students. "Yes, yes he is," Shoukri said as he walked away.

York staff 'deeply disappointed'

Last fall, months before it was announced Dahdaleh was to receive an honorary degree, York revealed he was donating $20 million to the school and it would name a building and a new institute of global health after him.

The university has rebuffed questions in recent weeks about what consideration, if any, it gave to Dahdaleh's legal tangles in its multiple decisions to recognize him.

In an emailed statement last week, York said that its policy for honorary degrees allows it to give them out for "significant benefaction to the university," among other things, and that Dahdaleh's donation was "the largest-ever gift by a graduate of the university."

A York professor said Monday she and many colleagues were "deeply disappointed" by the moves to put Dahdaleh's name on a building and give him an honorary doctorate.

"The optics of those decisions are not good for the university and certainly not good for the morale of the faculty and staff," Prof. Stephanie Ross said, expressing disappointment that York "made no attempt to rethink its decision to accept a very large donation" from Dahdaleh after the Panama Papers revelations.

"This situation is a symptom of a larger problem, which is the chronic underfunding of important institutions like post-secondary education that lead administrators to seek funding from ... wealthy individuals or corporations — but then also having to live with the association with those individuals or corporations if and when they are revealed to be not the greatest corporate citizens."

Search the Panama Papers:

• Who's in the Panama Papers? Search the database here
• What's in the Panama Papers database and how to search it

More Panama Papers coverage:

• Deals to catch tax cheats allow billions in taxes to escape
• How Canada got into bed with tax havens
• SNC-Lavalin paid $22M to secret company to get Algeria contracts
• Middlemen between Canada and offshore secrets revealed
• Panama Papers names go public
• RBC to turn over files on Panama Papers clients to taxman
• Iceland PM steps aside over offshore revelations
• Canada's top offshore middleman linked to fraudster

Send tips on this or any other Panama Papers story to zach.dubinsky@cbc.ca