Coyne: How senator’s bait-switch tactics ensnared PMO officials,

In the beginning, it was all about retrieving a few thousand dollars in improperly claimed expenses from a single errant senator. That’s what Nigel Wright* told the RCMP, and the emails police have recovered to date bear him out.

As early as Feb. 7, as the simmering issue of Sen. Mike Duffy’s housing allowance began to boil, Wright was telling colleagues there were only two plausible “ways out”: “(i) it was wrong and he has to be disciplined and/or repay, or (ii) there was ambiguity so it will be clarified and he will not claim the amount going forward.”

You could make a case for the latter, if you relied on the most literal reading of the rules regarding eligibility for housing allowances and not their plain sense. Duffy himself attempted to make that case to Wright in the days that followed. And, indeed, Wright agreed no laws were broken.

Yet, whether out of concern for political optics or, as Wright maintained to police, simple ethics, Wright insisted he repay. Sen. David Tkachuk, then the chair of the Senate standing committee on internal economy, agreed. And at several points they believed they had Duffy’s grudging assent to do so.

Yet whenever it seemed as if the matter had been resolved, a condition would get attached. At first Duffy was concerned not to admit wrongdoing: so assurances were given that that would not be required. Then Duffy objected that if he conceded that his primary residence was in fact in Ottawa, and not in P.E.I., he would be ineligible to sit as a senator. So further guarantees were offered on that score.

Then the Conservative and Liberal Senate leaders, Marjory LeBreton and James Cowan, issued a letter jointly decreeing that senators found to have improperly claimed expenses would have to pay them back. Duffy, perhaps sensing the trouble he was in, started to dig in his heels.

His lawyer sent an email exploring several further conditions: removal from the audit, reimbursement of his legal fees, some mutually agreeable “media lines” to smooth it all over. Finally, on Feb. 19, after some further back and forth, Duffy laid it on the line: not only would he not pay, he could not pay. He didn’t have the money.

For whatever reason, the government’s resistance began to crumble. Sen. Tkachuk suggested an arrangement whereby the audit could be called off if Duffy admitted he had made a “mistake.” Wright advised Duffy, according to the RCMP, that he would “look into a source of funds.” That turned out to be the Conservative Party of Canada, whose chairman, Sen. Irving Gerstein, had earlier offered his assistance.

But Duffy continued to raise the ante. On Feb. 21, his lawyer sent Wright an email setting five conditions on his co-operation. They included, in addition to the previous demands to stop the audit and reimburse him for his legal fees, demands that the Senate committee confirm his expenses were “fully in order” and would not be further reviewed; and that “as his apparent ineligibility for the housing allowance stems from his time on the road on behalf of the party,” an arrangement would be made “to keep him whole on the repayment.”

Duffy was attempting to expand the issue of his housing expenses into his expenses generally — demanding not only to be reimbursed, but to be exonerated, using the party’s own complicity in them as the whip. Wright would not agree to the whole package. But by the next day the party had agreed, not only to stop the audit, but to reimburse the senator for all of his improperly claimed expenses.

The party having taken the bait, Duffy now gave them the switch. The full amount of his expenses, it soon emerged, was not the $32,000 previously reported, but roughly $90,000, much of it in improperly claimed per diems. The party’s readiness to pay evaporated in the face of this: Wright, perhaps feeling he had run out of options, took the fateful decision to write the cheque himself.

But by now events had moved beyond his control. There were too many moving parts. Desperate attempts were made to halt the audit, or at any rate to persuade the auditors to take no position on the question of Duffy’s residency, on the basis that, having repaid the money, the question was moot.

But the audit, as it turned out, could not be stopped. And while the auditors did, indeed, take no position on Duffy’s residency (largely because they lacked the necessary evidence to form a judgment, Duffy having refused to co-operate with them), the Senate committee’s report proved no easier to corral. A draft prepared by Senate staff was critical of Duffy, on a “plain sense of the rules” basis. Only with some considerable browbeating by PMO officials were these remarks excised from the final report.

There will be ample chances to condemn. I attempt here only to understand: how an effort to get one senator to repay his expenses could have grown into such a complex apparatus of deceit; how powerful and respected public officials ended up conspiring to pay a sitting legislator for his silence, while covering up the record of his misdeeds; how Wright became entangled in Duffy’s web.

* I remind readers that I am in a conflict: I am an old though not particularly close friend of Nigel Wright, with whom I attended university. The last time we corresponded was last year, when he sent a note of condolence on my father’s death.