Mayor’s role at bank questioned
Vaughan’s Maurizio Bevilacqua also sits on board of VersaBank
Residents are raising questions about why the Mayor of Vaughan sits on the board of one of Canada’s first “virtual, branchless banks,” which focuses on, among other things, “providing financing to well-established real estate developers” across the country.
Maurizio Bevilacqua was appointed to the role of vice-chairman of the board for the London, Ont.based VersaBank last May, but the paid position has triggered concerns around the perception of an elected official taking on such a post, in light of the numerous development applications that come in front of the city every year.
“As long as Bevilacqua is vice-chair at VersaBank, the public will always be left to question whether there is a perceived or real conflict of interest given the fact that VersaBank’s focus is in land development financing,” said Richard Lorello, a long-time activist in Vaughan, who often takes the city’s politicians to task.
The bank, which was established as a chartered bank in 2002 and is a listed company on the TSX, issued a news release announcing the mayor’s appointment at the time. According to the bank’s website, VersaBank specializes in helping real estate developers and condominium corporations acquire financing for both development, and ongoing maintenance.
In the release announcing his post, the bank said the mayor’s previous role as a Member of Parliament, where he served as chairman of the House of Commons Standing Committee on Finance, qualified him for the “honorary vice-chair” position.
“It was during his tenure in the federal government that more flexible ownership rules and lower capital requirements were enacted to encourage new entrants to provide for more competition and more choice for Canadian consumers and small businesses,” the release states. “Mr. Bevilacqua has been keenly interested in how this important policy has evolved.”
Bevilacqua is one of the top-earning mayors in the GTA, making $179,028.98 according to the 2016 provincial disclosure list.
The $110,000 he’ll earn from the bank board will be donated to charity, VersaBank said.
Bevilacqua said he took on the position with VersaBank as an “adviser” on “issues of governance” and has no role in “drumming up business.”
“I was invited to join the board in an advisory capacity. As a director I am not involved in the day-to-day operations of the bank,” said Bevilacqua, in an email. “I am well aware of my responsibilities and obligations as a public servant and as a director of the bank and have always ensured that my activities are in compliance.”
Vaughan resident Robert Kenedy said he became aware of the mayor’s role with the bank after a recent development proposal came before council for an 11-storey condo building in Maple.
Jane Teston Holdings Inc., the company behind the condo project, is owned by Telemaco Matrundola, who also holds a position as executive head at the “VersaBank Innovation Centre of Excellence.” He was a key figure in the early years of the bank, when it was known as Pacific & Western Credit Corp.
In an email, Matrundola says he “consults” for the bank. “I am not an employee of the bank nor do I sit on its board; rather, I consult for the bank,” he said.
Matrundola said the condo project is now in front of the Ontario Municipal Board, as “the city did not approve the development application.” He said the application for the project was made to the city before the mayor was part of VersaBank.
According to a staff report, the city has yet to make a decision on the condo project. It came in front of council last September, months after Bevilacqua had joined the bank. At that meeting, council directed the developer to organize a community meeting to address residents’ concerns. This council-directed meeting has not yet taken place.
Kenedy said while there is no evidence of conflict in this project thus far, “there is a perceived conflict.” And it will continue, he said, for any development that comes to the city that is financed by VersaBank.
“This is a for-profit chartered bank that is lending money to developers and in terms of a perception, it doesn’t look good,” he said. “I think it’s bizarre that he would be comfortable enough to do this,” said Kenedy, referring to the mayor’s role.
Bevilacqua said before he joined the VersaBank board, he consulted with the city’s integrity commissioner, “who granted me the approval and permission to accept the invitation to sit on the board. I followed her advice as any responsible elected official would.” Ethics commissioner Suzanne Craig confirmed that the mayor discussed the role with her.
“Mayor Bevilacqua contacted me before his appointment as vice-chair with a view to whether the appointment was allowed under the code (of conduct),” said Craig. “I reviewed the matter and determined that the mayor was being considered for an appointment as an honorary vicechairman of the board in an advisory role with the expectation that he would bring his prior experience in the Canadian federal cabinet.”
She said, based on the information she received from both the mayor and the bank, she advised the mayor about ways he should conduct business in his advisory role to “avoid the perception of a code conflict.”
“He has accepted and complied with my recommendations fully,” Craig said.
VersaBank said Bevilacqua is not involved in daily operations.
“He is remunerated $110,000 for his one-year term, however it must be noted he wished for all of his remuneration to be directed to charity,” said Thelma Pacheco, executive assistant to the office of the president and CEO of VersaBank. “At the end of his one-year term, the bank will issue cheques to charities of his choosing, which include Mackenzie Vaughan Hospital and Hospice Vaughan.
According to information on the bank’s website, the for-profit company also donated to the 2017 Vaughan Charity Golf Classic and Vaughan’s 2017 Mayor’s Gala — two events close to the mayor’s heart. It’s not clear how much the company donated.
The mayor also sits on other boards, such as the York Region Rapid Transit Corp. and Alectra Inc., a utilities company owned in part by the City of Vaughan. Both are related to his role as mayor and as a member of York Region council.
Lorello says that when the mayor’s term on the bank’s board ends in April, he should decide which job he wants more.
“I firmly believe that Mayor Bevilacqua needs to decide whether he wants to be the Mayor of Vaughan or whether he wants to be a banker. I do not believe he can do both and maintain the public’s confidence,” he said.