Gary Timm, a member of Deloitte’s forensics financial advisory team, told the Senate Internal Economy Committee that Deloitte’s managing partner for Ontario, Michael Runia, telephoned him last March to ask how much Sen. Duffy would have to give back to the Senate if he repaid four years worth of living and travel expenses that had been at the centre of a growing government crisis since December 2012.
Court documents containing evidence from an RCMP investigation into Mr. Wright giving Sen. Duffy $90,000 to pay off his expenses revealed that Sen. Gerstein contacted Mr. Runia as Mr. Wright was at a crucial stage in attempting to manage the expense repayment before Deloitte reported to the Senate Internal Economy Committee on the legitimacy of Sen. Duffy’s expenses, as well as several hundred thousand dollars worth of expenses claimed by former Conservative Senators Pamela Wallin and Patrick Brazeau and former Liberal senator Mac Harb.
Sen. Gerstein is in charge of Conservative Party fundraising as chair of the Conservative Fund Canada and also has signing authority for Conservative Party contracts and spending. Mr. Harper (Calgary Southwest, Alta.) named Sen. Gerstein to the Senate in 2009.
Deloitte has been the Conservative Party’s auditor for its annual financial statements and federal election expense reports since the party was formed in 2003, after having served prior to that as the auditor for the Progressive Conservative Party. The Senate Internal Economy Committee awarded Deloitte a sole-source contract for the forensic investigations into the Senate expenses, but it is unknown whether the Conservative majority on the committee had the support of the Liberal minority when the two contracts were awarded last January.
Court evidence filed by RCMP Cpl. Greg Horton discloses that Sen. Gerstein contacted Mr. Runia, whom he knows through Deloitte’s work for the Conservative Party, at Mr. Wright’s request.
The RCMP document says Mr. Wright emailed PMO legal counsel Benjamin Perrin on March 1, saying, “Today I asked Sen. Gerstein to actually work through senior contacts at Deloitte and with Sen. LeBreton. … The outcome we are pushing for is for Deloitte to report publicly that IF Kanata were the primary residence then the amount owing would be the $90,000 figure and that since Sen. Duffy has committed to repay this amount then Deloitte’s work in determining primary residence is no longer needed.”
That did not come about, but the plan also involved what turned out to be a successful effort to have the Conservative majority on the Internal Economy Committee delete condemnations about Sen. Duffy’s housing allowance claims that were included in all three reports on the other Senators.
Mr. Timm, who appeared at the committee with two other members of the Deloitte forensic team to answer questions about Mr. Runia’s contact with the accountants, revealed that Mr. Runia was seeking information that was not part of evidence filed by Cpl. Horton last week to obtain a court order allowing him to gather more email evidence from Senate email accounts as well as Sen. Duffy’s bank accounts.
“He [Mr. Runia] contacted me on one occasion, one phone call,” Mr. Timm told the committee as a crush of journalists, political aides and Senate staff watched him respond to questions from Liberal Senator George Furey.
“The call was, he wanted to know if Sen. Duffy were to repay, how much would that be?” Mr. Timm said.
“I told him I can’t divulge or disclose any confidential information,” Mr. Timm said. “He understood my reply. I directed him to public information where he, if he wanted to find out what the total entitlements that a Senator could have for living allowances was. It was a short call and it ended there.”
Sen. Furey responded: “Did you ask him why he was making the call, or on whose behalf he was making the call?”
“In terms of that, given my background, I wanted to keep everything confidential and I wanted that call, like I said, to end, so I ended it. No, given the question, no,” Mr. Timm told Sen. Furey.
“But did he call you about the report?” asked Sen. Furey.
“He called me about that one question,” said Mr. Timm.
The RCMP evidence shows that the amount Sen. Duffy owed, if he were to repay his expenses, had become critical in negotiations between his lawyer, Janice Payne, and Mr. Perrin.
Ms. Payne emailed Mr. Perrin and Conservative Party lawyer Arthur Hamilton on March 5, according to the RCMP documents, to say Conservative Senator David Tkachuk, then-Conservative chair of the Internal Economy Committee, had urged Sen. Duffy to ask Ms. Payne to write to Deloitte to state that he wanted to “resolve this matter” by repaying all of the housing allowances he had been paid since his appointment in 2009.
“Please confirm that he will be withdrawn from the review you have been asked to undertake as soon as the repayment has been made,” Ms. Payne’s proposed email to Deloitte said.
She asked Mr. Perrin and Mr. Hamilton to confirm that day that they had no difficulty with the suggestion or to come up with another course of action.
Mr. Wright responded to Mr. Perrin and other PMO aides who were involved in the plan. “I would like to check this with Irving [Gerstein],” Mr. Wright said in an email to the others. He also told them he did not want Sen. Duffy or Ms. Payne to contact Deloitte directly to find out how much Sen. Duffy would have to repay.
“I would support taking the approach below [Ms. Payne’s proposal] IF I can be satisfied that Deloitte will accept the proposal. … I am reluctant to have her ask Deloitte to specify the amount of expenses owing because that would give Deloitte an excuse to ask for documents from Sen. Duffy again,” Mr. Wright wrote.
The RCMP evidence includes an email dated on March 8 that shows Mr. Wright had by then learned how much Sen. Duffy would have to repay.
He emailed PMO director of issues management Chris Woodcock to say that he was “personally covering Duffy’s $90K.”
Mr. Wright received an email that same day from Mr. Harper’s director of Parliamentary affairs, Patrick Rogers, who told Mr. Wright that Sen. Gerstein had called and that he “agrees with our understanding of the situation and his Deloitte contact agrees. The stage we’re at now is waiting for the Senator’s contact to get the actual Deloitte auditor on the file to agree. The Senator will call back once we have Deloitte locked in.”
In light of Mr. Timm’s statement that he had no other contact with Mr. Runia, Senators had no idea on Thursday what that email meant.
The Conservative majority on the Internal Economy Committee voted down a Liberal motion to invite Sen. Gerstein to the committee to provide an explanation of his discussions with Mr. Runia.
Conservative Senator Gerald Comeau, the chair of the committee who coincidentally retired early from the Senate as of Thursday, said the Internal Economy Committee does not have a mandate to conduct investigations.
Mr. Timm and Peter Dent, that national leader of Deloitte’s forensic advisory practice, were adamant that no confidential information leaked out of the investigation.
“The independence of our forensic examinations is of paramount importance, and we go to great lengths to ensure that such independence is always upheld,” Mr. Dent told the committee. “In the case of the work that we undertook for the Senate of Canada, this was absolutely the case.”
Mr. Dent gave the same assurance to media that surrounded the auditors as they left the Senate committee room.
“At no time was confidential information shared outside of the forensic examination team, and Deloitte stands by the content, the quality and the objectivity of the information we provided. If you have other questions of us, then I would direct you to our media relations,” he said.
When The Hill Times asked Mr. Dent how it could be that the RCMP evidence also shows Sen. Gerstein appeared to be aware that Deloitte was unlikely to be able to make a conclusion about the legitimacy of Sen. Duffy’s permanent and temporary residency claims, he replied: “We have no idea.”
Original Article
Source: hilltimes.com
Author: TIM NAUMETZ
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