Evidence alleged Duhaime more than ‘ignorant’
SNC-Lavalin CEO OKed ‘abnormal’ MUHC payments, VP told police
Court documents prepared during the investigation into how the consortium led by SNC-Lavalin fixed the bid to build and maintain McGill University Health Centre superhospital contain witness accounts that allege the engineering firm’s former CEO, Pierre Duhaime, was much more involved in the conspiracy than he admitted to in court recently.
On Feb. 1, Duhaime, 64, walked away from the Montreal courthouse with a sentence that required him to spend no time behind bars after having pleaded guilty to one count of breach of trust. The 20-month sentence he received includes six months of house arrest. He is also required to perform 240 hours of community service and he agreed to make a $200,000 donation to a provincial organization that lends support to the victims of crime.
Quebec Court Judge Dominique Joly based her decision to agree with the recommended sentence, in part, on a joint statement of facts — produced by the Crown and Duhaime’s defence lawyer, Michel Massicotte — that were entered into the court record on the same day Duhaime pleaded guilty. The statement of facts is a 32-point list, but only a few of the paragraphs make actual reference to what Duhaime’s role was in how the consortium led by SNC-Lavalin ended up with the contract to build the hospital and maintain it for 20 years. Late last year, a lawyer for the hospital revealed the overall contract is worth $4.6 billion.
During the Feb. 1 hearing, Massicotte characterized his client as having been “wilfully ignorant” of the rigged bid. The few references to Duhaime in the document limit his role to a period between Nov. 1 and Nov. 19, 2009. It makes a vague reference to how, on Nov. 1, 2009, Duhaime made a “short” telephone call to Yanaï Elbaz, the MUHC executive who was in charge of the bid for the contract.
It then goes on to state that in the following days Duhaime: “was made aware that one of his employees at SNC-Lavalin communicated with Yanaï Elbaz” and that Duhaime had “reason to believe” the employee was receiving information on the bid from Elbaz.
“Yanaï Elbaz supplied privileged information to the SNC-Lavalin employee. Some of the information was used by SNC-Lavalin with the goal of responding to the letter of engagement” in order to meet the requirements set out by the Quebec government to build the hospital.
In November, Elbaz admitted he pocketed $10 million in bribe money for having supplied the information and is currently serving a 39-month prison term. His co-conspirator, former MUHC head Arthur Porter, died before he could answer to charges filed against him in the same case. And in July 2018, Riadh Ben Aïssa, 60, the former vice-president of SNC-Lavalin’s construction division and the man who is most likely the person referred to in the joint statement of facts in Duhaime’s case as the recipient of the insider information, pleaded guilty to a reduced charge of using forged documents. Ben Aïssa was sentenced to serve one day in jail on top of a 51-month sentence he had previously served.
Duhaime’s sentence seemed light when compared to Elbaz’s and on Thursday, a week after it was delivered, The Globe and Mail published a story quoting anonymous sources who alleged the Prime Minister’s Office pressured former attorney general Jody Wilson-Raybould to negotiate a remediation agreement that would have put an end to a different case at the Montreal courthouse where three SNC-Lavalin companies — SNC Lavalin International Inc., SNC Lavalin Construction Inc. and Groupe SNC Lavalin Inc. — are charged with having paid millions of dollars in bribes to obtain government business in Libya.
The preliminary inquiry in that case is scheduled to resume at the Montreal courthouse on Friday.
While the cases brought against Duhaime and the three companies are separate, the investigations into both were intertwined. Sûreté du Québec investigators in Project Laureat, the investigation into the MUHC superhospital, received information from Swiss authorities investigating alleged bribes paid to the Libyan government recorded a phone conversation during which Ben Aïssa told another person he had to pay something for a hospital in Canada.
“And the contract is worth 30, and only 22 has been paid,” Aïssa told the unidentified person on the other end of the line.
It was an obvious reference to how Elbaz and Porter arranged to be paid $30 million in bribes for the information Elbaz supplied to SNC-Lavalin. Just under $22.4 million was paid to Sierra Asset Management, a shell company Porter created, before questions began to be raised about the contract SNC-Lavalin used as a cover to pay the bribe.
It is references to the contract, contained in an affidavit prepared by an SQ investigator in 2013, that allege Duhaime knew much more about the bid-rigging than what he admitted to in court on Feb. 1.
The allegations in the affidavit have not been tested in court.
On Oct. 30, 2012, Michael Novak, a vice-president with SNC-Lavalin, met with two SQ investigators at part of the Project Laureat investigation. He explained how “agent contracts” were paid out at the firm and said it was “very abnormal” for them to have predetermined payment dates in them, as the contract with Sierra Asset Management called for.
According to the affidavit, on Dec. 9, 2011, an SNC-Lavalin employee asked Novak to authorize a payment SNC-Lavalin was to make to Sierra Asset Management. He said he refused to sign because it fell “outside the corporate limits of the company.”
Novak also said that, two days later, Duhaime asked him why he refused to sign and that he gave his boss the same explanation.
“What will you do if I order you to sign it,” Novak quoted Duhaime as having said during their meeting. Novak said he told Duhaime he would have to put the order in writing “but counselled him not to do so.
Pierre Duhaime retorted that it was okay, but that he was the CEO of the company and that he would take full responsibility.
He immediately called Riadh Ben Aïssa into the office, in the presence of Novak (and another man)” and repeated to all three men that he would take full responsibility for the contract.
Another SNC-Lavalin employee told investigators that, in January 2012, Duhaime was deeply concerned about the contract and had asked him to “find a way to make everything legal.” Later that same day, the employee said, Duhaime called him at home and pressured him again and mentioned that he could lose his job if he didn’t make things look legal.