Loan to Harb may have broken rules
Documents show man behind money director of firm with federal contracts
The expense scandal surrounding Sen. Mac Harb has deepened, with new documents showing he accepted a loan from an Ottawa businessman and philanthropist who does business with the federal government.
Harb, whose living expense claims have already made him the subject of an RCMP investigation, accepted a $55,000 loan on May 17 from a numbered company, according to property records obtained by Postmedia News.
The senator filed an updated disclosure statement to the Senate ethics officer on June 12 indicating he owed an unspecified amount of money to 1202864 Ontario Ltd. A corporate profile report obtained by the Citizen shows Ottawa lawyer and businessman Brian Karam as the company’s president and only listed officer.
Documents also show Karam is the president and a director of another numbered company, 595799 Ontario Ltd. That company operates as The Business Inn, a hotel at the corner of MacLaren and Elgin streets (MacLaren’s pub, which Karam also owns, is on the building’s ground floor).
The Business Inn has been awarded federal contracts, including a current contract with a value of $1.87 million.
The Criminal Code states that government officials cannot accept an “advantage or benefit” of money from someone who deals with the federal government without first getting written permission. So far, Harb, Karam and the Senate have all declined to comment.
The news comes as new information is emerging on the file of Sen. Pamela Wallin, specifically that her decision to regularly break up her trips between Ottawa and Saskatchewan by staying overnight in Toronto is the main focus of a lengthy audit of her travel expenses.
That audit, to be released next week, will outline whether that travel pattern added significant costs to taxpayers for flights, as well as taxis to and from a Toronto condominium she has owned for years — costs she arguably would not have incurred had she taken one continuous trip to Saskatchewan from the nation’s capital.
“We’ll want to know why this was happening and have some kind of an explanation,” said Sen. Gerald Comeau, chairman of the Senate’s internal economy committee, which is overseeing work on Wallin’s audit.
“Then it’s up to us to determine whether we’re satisfied with the response to any of these questions.”
Wallin has already repaid $38,000 for improper expense claims that she has said were related to her work on corporate boards. Comeau confirmed auditors have also zeroed in on additional instances where Wallin may have improperly filed travel expense claims for trips more related to corporate work than to Senate duties.
The Senate has already ordered Harb to repay $51,482.90 in ineligible expense claims, which he did under protest.
Before being thrust into the Senate expense scandal, Brian Karam, the man who loaned Harb $55,000 in May, was best known for his business acumen and charity work.
Karam was the founder of the Elgin Area Property Owners Association and Elgin Business Association. A licensed lawyer, he was awarded a Community Builder Award from the United Way in 2010 for his work with charities like the Ottawa Snowsuit Fund and REACH, an organization whose mission is to improve the quality of life for citizens with disabilities by offering lawyer referral and educational services at the community level.
He is also a member of the Elvis Sighting Society, hosting a variety of fundraisers over the years for charities such as The Ottawa Hospital, the Ottawa Heart Institute, the Elizabeth Bruyere Hospital, the Royal Ottawa Mental Health Centre and Peace Camp Ottawa, according to the United Way.
Karam donated $5,000 to a campaign to raise money for the construction of the Royal Ottawa Mental Health Centre’s youth wing.
He is also past president of the Dewaan Association of Lebanese businessmen, past president and vice president of the Canadian Organization for Development through Education and was one of the founders of the National Indian Arts and Crafts Corporation, according to the United Way.
Court documents showed that Karam owned a building on Gilmour Street that housed offices leased to Public Works and Government Services Canada.
Meanwhile, the Senate’s internal economy committee will return to Ottawa on Monday for a rare summer meeting. Senators who are members of the committee will see the Wallin audit for the first time and have a chance to question auditors who worked on the review, which has taken six months. Wallin also will have a chance to see the audit and speak to the full committee on Tuesday when it meets behind closed doors to debate a draft report from its three-member executive, which includes Comeau and senators George Furey, a Liberal, and Conservative Carolyn Stewart Olsen.
That committee will decide what, if any, actions the Senate should take, including requiring committee approval of her expense claims or ordering repayment of funds to the Senate.
The RCMP is currently investigating Harb and two other senators, Patrick Brazeau and Mike Duffy, over allegations of breach of trust. Duffy is also being investigated for potential frauds on the government over a $90,000 payment he received from Prime Minister Stephen Harper’s former chief of staff Nigel Wright to cover repayment of his improper housing allowance claims, according to RCMP court documents. None of the allegations has been tested in court and no charges have been filed.