Part 5 - All the King's Men - Brian Tobin

This series, All the King's Men, casts a light on the dark corners of Newfoundland and Labrador politics. In most cases that involves the provincial PC Party, but not always. In fact, it's a mistake to think that one party is pure as the driven snow, while the other swims in corruption. The truth is that politics within the province is run by a very few - hence the name of this series. That group of people can swap their financial support around as conditions for them require, and capture the party they need to advance their agenda. In other words, the back room boys of the province.This post involves such a story, and the Liberal party of the province.

In 2011, Liberal leader Yvonne Jones was ill with breast cancer, and being treated with chemotherapy. Speculation ran rampant that she would be unable to lead the party in the 2011 general election. Yet, despite her condition, Jones insisted she would run. In July, 2011, an apparent attempt to have her step down in a deal put forward by Dean MacDonald was openly denied by both parties. http://www.polemicandparadox.com/2011/07/as-provincial-politicians-hit-summer.html
Despite her denials to the contrary, Jones resigned the next month with mere weeks left before the election was to be held. She left the party with a large debt, and no prospects for raising money to run an election campaign.

In the ensuing leadership contest, which amounted to executive board interviews of seven potential candidates, myself included, Kevin Aylward was chosen. Aylward had placed his name on the ballot approximately 20 minutes before the cut off to do so. Aylward, a former cabinet minister and president of Nunacor (a resource/mining arm of the Nunatukavut community in Labrador) was "lucky" enough to have former premier Brian Tobin step up, and hold a fund raiser for the provincial party in Toronto to help pay for the election. Leading up to this time, the provincial Liberals had fought tooth and nail to stop the Muskrat Falls project. However, all that was about to change as noted in an earlier post http://rocksolidpolitics.blogspot.ca/2012/05/muskratmines-and-railways-liberally.html

As the saying goes, to figure out the behind the scene machinations you need to follow the money trail, and this case was no different. When Tobin left public political life, and the spotlight of the cameras, he became immersed in the corporate world. Specifically mining in Labrador - among others. When he called a group together in Toronto for donations, to the provincial Liberals here, that influence was quite obvious. Here are the people/companies that answered Tobin's call:

AECON Construction Group Inc

$10,000.00

Tobin sits on the board of directors of AECON, a large international construction company. However, AECON is also on the bidding list for construction of Alderon's Kami mine project:

Mine pit development, and tailings dam.

Municipal Enterprises Limited

$10,000.00
Municipal Enterprises owns Municipal Construction, which in turn owns Dexter. Dexter is bidding on Alderon's Kami mine project as well:

Bid 1 Clearing, grubbing mining, and maintenance areas and construction access; and

Bid 2 Mine pit development and tailings dam.

Sam Bharti

$10,000.00
"Sam" Bharti, as listed on the contribution list of the province, is actually "Stan" Bharti, owner of Forbes and Manhattan Group of Toronto, and the main driving force behind the creation of Alderon and the Kami project.

Bernard Wilson

$1,000.00
Wilson is a Forbes and Manhattan man, and sits on a number of its companies boards: Aberdeen International; Avion Gold; and Valencia Ventures Inc.

John Vettesse

$10,000.00
Vettesse is a partner with Cassells Brock law firm in Toronto, and a director/shareholder of Alderon.

Gemma Communications

$10,000.00
Gemma Communications is a subsidiary of Tuckamore Capital Management run by Dean MacDonald.

Magna International

$5,000.00
Tobin served as Vice-Chair and director of Magna.

Norvista Resources

$10,000.00
Norvista is a mining resource company out of Toronto that Tobin sat on the board of.

Energizer Resources

$5,000.00
Energizer is a mining resource company out of Toronto that Tobin was Chair of its Special Advisory Committee and a shareholder.

John Marinucci

$1,000.00
Toronto businessman, friend and former class mate of Tobin.

Vincent Sardo

$1,000.00
Toronto businessman, and director of Thompson Consolidated Iron Mine - which Tobin ran.

GMP Securities

$2,000.00
Toronto financial company that represented Alderon in securing its financing agreement with Hebei Steel of China for the Kami Mine project.

Douglas Bell

$4,000.00
Vice Chair and Co-Head of Investment Banking at GMP Capital - the parent company of GMP Securities, which acted for Alderon with the Chinese.

George Albino

$2,000.00
Gold and Precious Metals Expert, GMP Securities.

Roy D'Ambrosio

$2,000.00
"Roy" as listed on the contribution list of the province, is actually "Roy". Managing Director of GMP Securities.

NOTE - Combined totals of GMP and its officers is $10,000.00 - which mirrors the others.

BMO Nebitt Burns Inc

$5,000.00
Tobin currently sits as Vice-Chair, significant institutional owner of Alderon shares, bank for the Innu Trust Fund, Labrador.

Jason M. Attew

$1,500.00
Director, Global Metals and Mining, BMO Capital Markets.

William Butt

$2,000.00
Head of Investment and Commercial Banking BMO (now retired).

John Sabine

$1,500.00
Lawyer at Bennett Jones in Toronto -  Mining, Finance and Mergers. Sits on the boards of a number of mining companies.

On the face of it, one could say Tobin came to the rescue and saved the provincial Liberal party from a dim financial performance in the 2011 election. Certainly that is the view of some. However, there is also another side to this equation.

For starters, Yvonne Jones suddenly became a proponent of the Muskrat Falls project and its use for mining companies in Labrador. She also became a big cheerleader for developing mining companies in Labrador, and even a proponent of a Labrador railway (which is necessary for Labrador mines to ship their products to Quebec ports for export). Is that all a coincidence? It certainly represented a sudden and major shift in her public stances. To this day, and despite the fact she is a federal MP now, Jones frequently interjects on matters that are considered provincial affairs in Labrador, and they often involve mining and power in Labrador.

The Liberal Party itself has substantially toned down its opposition to the Muskrat Falls project, and has also been a major proponent of mining developments in Labrador. All of this begs an obvious question: Did political contributions change the tune of the provincial Liberal Party? It's hard to say. You can judge for yourself. This series has focused on the influence of corporate donations to political parties in the province, and in my opinion this particular case is no different than any of the others. As Stan Bharti, the head of Forbes and Manhattan and donor above, once said:

"To minimize risk, we do two things. We always have a very strong local presence. Local people, local officers, local connections. We also make sure that at a political level we have some good connections... I sometimes tell people you can either buy political insurance, or you can have a good local person."

To Dwight Ball, the new leader of the Liberal Party's credit, he promised to introduce political donation reform as part of a democratic reform package for the Party in the 2015 general election. Ridding the province of corporate and union donations is the only way to clean up our democratic system here. It is long overdue. It is banned at the federal level, and is only allowed in three of ten provinces. Ridding ourselves of this will alleviate the need for companies to, as Bharti says:

"buy political insurance."

Part 4 - All the King's Men - Danny Williams

This story starts with a guy named Tom Tatham. You probably haven't heard of him before. He's an American business man who, back in the late 1990's, came to the conclusion he wanted in on the natural gas scene on the east coast of Canada. Tatham created two companies in late 1997 to accomplish the task: Tatham Offshore Canada Limited, a Massachusetts registered corporation; and North Atlantic Pipeline Partners (NAPP), a Delaware registered corporation. The board of directors of NAPP included a number of Newfoundlanders: Danny Williams; Craig Dobbin; Angus Bruneau; and Cabot Martin. Tatham's first goal was to secure the natural gas resources off Sable Island, that could hook up to a pipeline from the Grand Banks. However, NAPP was too late getting in, and the federal government would not consider his application.

Tatham and company changed strategies, and decided to focus on the natural gas off Newfoundland, and to build a liquefied natural gas (LNG) plant in Placentia Bay. On April 17, 2001, Newfoundland LNG Company Inc. was incorporated in the province. It's name changed again in 2005 to simply Newfoundland LNG Ltd. The group became very involved in the province. The battle lines were drawn roughly between the then Mayor of St. John's Andy Wells (along with his group known as "The Friends of Gas Offshore" - of which Newfoundland LNG was one) and the oil companies. Wells, NAPP and company wanted a fixed offshore platform for the White Rose oil development. That would enable extraction of natural gas by concrete pipe to an onshore LNG plant - owned by Tatham's Newfoundland LNG of course. The oil companies argued the most efficient platform was a floating platform - which would finish off the chance of piping natural gas to an LNG plant. Newfoundland LNG dumped just over $4,800.00 in political donations to the then in power Liberals, but the oil companies got there way, and Newfoundland LNG was left holding the bag.

While all this drama was unfolding, Danny Williams, former director of Newfoundland LNG, took over as leader of the PCs and leadership of the Official Opposition. Neither Tatham or Newfoundland LNG donated any more money to the Liberals after 2002. In 2003

Williams won the provincial election, and began rewriting the province's energy priorities. Next up for Williams was fighting with the oil companies over the Hebron offshore field. While that battle was going on, Newfoundland LNG had secured two important partners for its proposed LNG facility in Newfoundland. SNC Lavalin/ BAE Newplan Group became invested in the project as project managers and engineers, while Stantec-owned Jacques Whitford was secured as environmental consultants to guide the project through Newfoundland and Labrador's environmental process.

Moving along side Newfoundland LNG's project for Placentia Bay was another big hitter project - the Newfoundland and Labrador Refining Corporation (NLRC) -  being advanced by Altius Minerals. NLRC also had SNC Lavalin/BAE Newplan Group as its engineering and project management company, and it was aiming to be built in Placentia Bay as well.

In 2006, Newfoundland LNG and Tatham started donating to political parties again. Newfoundland LNG donated $4,800.00 between 2006-2007, and Tom Tatham himself wrote a cheque for $4,000.00 as well in 2007. This time all the donations went to the PC Party, with Tatham's own donation being to PC Party's reelection fund for the 2007 election. In addition, SNC Lavalin's BAE Newplan Group donated $23,750.00 to the PC's in the years 2006-2008, and Jacques Whitford donated $3,250.00. Here's the problem - Newfoundland LNG was undergoing an environmental review process of its LNG plant from November 23, 2006 to January 19, 2007. In other words, the company, the principal owner, the engineering company, and the environmental engineers were making political donations to the people who were in charge of the environmental review - the PC Party. Furthermore, as leader of the PC Party and Premier, Williams could hardly be accused of not knowing the players.

Coincidentally, the Newfoundland and Labrador Refining Corp started their environmental process on October 25, 2006, and ended it on May 2, 2008. An even bigger coincidence? SNC Lavalin started working with them in early 2006.

During this part of SNC's corporate history, LNG and refinery projects were its biggest money makers - whether in North America or the Middle East. It was during this time, and later, that SNC's Ben Aissa traveled the globe bribing officials for large government contracts. Ben Aissa was named as a director of a little known company in Newfoundland and Labrador called BAE-SNC Limited. It was essentially a shell company, with no apparent reason for existing. SNC claims he was only with the company as a director for about a year, and it was voluntarily dissolved on December 31, 2008. The question has always been why? Why was Aissa placed as a director of a shell company for one year, in Newfoundland and Labrador,  and then the company was struck completely from the records?

Williams had tried, during 2006, to force the oil companies to back a new refinery as part of the Hebron development project. They refused. In August, 2008, Williams caved on the refinery issue and signed Hebron. Two months later SNC sued the refining company and its shareholders. Two months after that Ben Aissa and the SNC shell company were struck from the record.

On May 14, 2009, SNC Lavalin bought Danny Williams' two offshore service companies: Spectrol Energy Services; and Williams' interest in Atlantic XL - while he was premier. Three weeks later, Newfoundland LNG President Mark Turner announced the LNG terminal project at Placentia Bay was dead in the water. Turner had hoped to buy the company off its American owner (Tom Tatham) and carry on, but that was a pipe dream - pardon the pun. Tatham had already moved his interest to the British Columbia coast, and was using one of his subsidiaries, Maverick LNG, and a ship bought to extract gas off Newfoundland, to try the same plan with natural gas in Kitimat, BC.

Was all of this business as usual in Newfoundland and Labrador? Was Williams' looking after our interests in the offshore negotiations, or was he looking after his and his friends? It's clear that if Williams' plan to build both a LNG facility and a refinery at Placentia Bay were successful, that SNC Lavalin would have struck the mother load here. Is that why Ben Aissa was named to that numbered company, and then vanished when the deals collapsed? Was buying Williams' two offshore service companies part of the deal? Was it acceptable for Williams to accept corporate donations from companies involved while they went through environmental screening by his government? Does any of it pass the smell test? Or, was it just a case of the King being the King.

UPDATE

Maverick LNG, the subsidiary of North Atlantic Pipeline Partners mentioned above also registered itself in Bermuda for unknown reasons. The company was struck from Bermuda's corporate Registry in July, 2011 for inactivity.

Part 3 All the King's Men - Shawn Skinner & Trevor Taylor

The Department of Innovation, Trade, and Innovation is essentially a department set up to dole out tax dollars to companies looking to expand or develop their businesses here in the province. Within the department is a program called the "Commercialization Program". The role of the program is:

            The Commercialization Program bridges an identified funding and
            investment gap between product research and product marketing. It
            provides financial assistance to private sector enterprises for activities
            leading to the development of innovative, market-ready products and
            services, including support for technology transfer activities. The
            program will assist companies in Newfoundland and Labrador that have
           difficulty securing investment or loans to develop innovative products
           or services.

In other words, it doles out taxpayers money to companies that can't get bank loans. It gives "qualified" companies up to 75% of the cost of developing their product to a maximum of $500,000.00.

In late December, 2007, Minister responsible Trevor Taylor approved a $500,000.00 loan for NewLab Clinical Research - the maximum amount allowed. The Minister allowed the funds released to the company using future profit projections as the equity investment required by the company under the program. In other words, the company didn't have to put a cent upfront for the loan. Then, in late 2008, new Minister Shawn Skinner approved another loan. This time to Newfound Genomics for $500,000.00. Instead of using possible future profits as it's down payment (equity) investment, the company transferred $200,000.00 of government money already lent to NewLab Clinical Reaearch into the account of Newfound Genomics. The result? Dr. Wayne Gulliver, the owner of both companies, received $1 million from the taxpayers without putting up a cent.

During this time, Mr. Gulliver and his company NewLab Clinical Research were donating to the PC Party. Their donations were as follows:

2007 - NewLab Clinical Research     $1,450.00

2008 - Wayne Gulliver                      $2,000.00
           NewLab Clinical Research     $   900.00

2009 - NewLab Clinical Research    $4,500.00

2010 - NewLab Clinical Research    $5,000.00

2011 - NewLab Clinical Research    $4,500.00

2011 was the last year that Gulliver or his companies made political donations according to the records. Also happening in 2011 was an investigation by the Auditor General into the awarding of the $1 million worth of loans to these two companies. The Auditor General found a number of problems, including: No equity investment made by the companies as was required by the loan agreement; taking on additional debt in contravention of the loan agreement ( $460,000.00 bank mortgage - a total of $961,763.00); $33,200.00 paid out to a director of the companies, which contravened the loan agreement; and no remedies included in the loan contract if the company broke the terms of it. The Auditor General also found that additional monies were paid out to the two companies by the government: $21,000.00 in wage subsidies; and $5,000.00 in trade mission subsidies.

In fact, the Auditor General stated:

" The terms and conditions of funding indicated the applicant must use the funds for the items outlined in the Commercialization Program."

That essentially refers to wages, equipment, etc. So the question that comes to mind is how do political donations fit into that description? Almost $16,500.00 was paid out by the company to the PC Party during the period in political donations.Another, far more troubling question is how can the PC Party accept money from a company it is negotiating development loans with? As part of that loan agreement the Government of Newfoundland and Labrador also became a shareholder. That is a question for Taylor, Skinner and the PC Party to answer.

In April, 2011, Newfound Genomics sold its equipment an closed shop. Finance reports from the province indicate the full $500,000.00 from Newfound Genomics was still outstanding, and that money is still being recorded as a viable investment on the books. The same financial reports indicate that NewLab Clinical Research has paid back a gran total of $16,000.00 of its $500,000.00 loan since 2007 - that's slightly less than it contributed to the PC Party during the same time.

Meanwhile, then President and CEO of Newfound Genomics, Siobhan Coady, seems to have said little on the issue. Coady is currently listed as President of Bonaventure Capital (which doesn't exist according to provincial and federal corporate registries), and seeking the provincial Liberal nomination in St. John's West. Coady was also involved with Gulliver in The Clinical Trials Centre, which was involuntarily dissolved in 2013.

Just another incidence of the PC Party profiting off government business. In this case a company partly owned by the government paid off the PC Party rather than the taxpayer. It's also another case of the King's men taking care of business.

Related links to this story:


Telegram story 2011:
file:///C:/Users/Cabana/Desktop/NL%20%20AG%20investigating%20Newfound%20Genomics%20loan%20-%20Provincial%20News%20-%20Daily%20Business%20Buzz%20-%20Newfoundland%20&%20Labrador.htm

Ministry of Finance, Public Accounts, Volume 1, (page 63)
http://www.fin.gov.nl.ca/fin/publications/volumeI_2012-13.pdf

Report of Auditor General 2011 (Page 417)
http://www.ag.gov.nl.ca/ag/annualReports/2010AnnualReport/AR2010.pdf

Siobhan Coady makes play for provincial seat (CBC)
http://www.cbc.ca/news/canada/newfoundland-labrador/siobhan-coady-makes-play-for-provincial-seat-1.2512216

Genomics lab quality questioned (CBC)
http://www.cbc.ca/news/canada/newfoundland-labrador/genomics-lab-quality-questioned-1.1027319

All the King's Men - Part 2 - Tom Marshall and Pomerleau Construction

Tom Marshall has a reputation among the people of this province as a calm, steady hand. For most of his political career he was the Minister of Finance and President of the Treasury Board - both jobs that require professionalism and judgement. On the surface, Marshall comes across that way. But, is that really the story here?

People might be a little surprised to realize that, in fact, Tom Marshall has taken more cash from companies doing business with the government than any other PC MHA. I certainly wasn't expecting to find that, but that is the truth. Going through the political donations the pattern is quite obvious, especially when a particular corporation donates to more than one MHA. In those cases you may see an MHA get $500.00, another minister get perhaps $1,000.00, but then you will see Marshall get $5,000.00. I've taken to calling it the "$5,000.00 Club". Corporations that fall into that club, at least for the last election in 2011, were:

Atlantic Engineering Consultants Ltd (owned by WSP-which was the disgraced Genivar from Quebec)
Brook Construction
Hearn Fougere Architects Ltd
Johnson's Construction
Marine Contractors

All have significant business with this government. Then of course there is the biggest single donor to Marshall, which is none other than Coleman Management Services for ($7,500.00) owned by Frank Coleman - the guy who just got out of a quandary with his paving company Humber Valley Paving. That one is now being investigated by the provincial Auditor General.

There are a number of what I like to call the "$1,000.00 Club", and they all have contracts with the government to. There are too many to reasonably list here, but one of them, Corner Brook Pulp and Paper, might raise some eyebrows. Considering that Corner Brook Pulp and Paper were undergoing no less than the environmental review of two long term forestry use plans at the time, a political donation might well be questionable - at best. Suffice it to say that the interim premier of this province is the biggest offender when it comes to taking money from those that hold government contracts. However, there is one particular case that is perhaps more troubling than most.

We have all heard of the corruption investigations going on in Quebec. They've been going on for two years now. The Commission there is looking at the construction industry, and the use of political donations by these companies to get contracts. People are being investigated. People have been arrested and charged. It's a serious problem.

In 2007 a construction company from Quebec was looking to get its foot in the door here in the province. That company's name is Pomerleau Construction. You may have seen their signs on the Convention Centre addition in St. John's. If you are reading this from Corner Brook you've seen their signs on City Hall jobs, and the new health centre. In Labrador, ditto at the new Lab West hospital. In 2007 they were just coming in. I've already wrote one post on how former premier Danny Williams accepted $5,000.00 from the company just around the time they were awarded the Long Term Care Facility job in Corner Brook:
http://rocksolidpolitics.blogspot.ca/2013/04/pomerleau-construction-donation-to.html

However, Williams wasn't the only one to receive funds from Pomerleau that year for his election campaign fund. Marshall did to. There was a difference between the two donations funny enough. In the case of Williams, the cheque was made out by Pomerleau Construction to him. In the case of Marshall it was trickier to find. In fact, it was disguised. It was disguised by location. It was disguised by name. It was disguised by amount. Here's how it worked.

Two senior executives of Pomerleau Construction donated $2,500.00 each (to reach the magic $5,000.00 total). The executives were Eric Gaulin, Vice President Construction - Ontario and Atlantic Canada, and Barbara Veilleux, both from the Ottawa office of Pomerleau. The other interesting part of this is the donations are recorded as coming from Fall River, Nova Scotia. Fall River is located just outside of Dartmouth where the Pomerleau office is located.

The bottom line is that a Quebec construction company, that never made a political donation in the province before, suddenly makes $10,000.00 worth of donations to the two most powerful people in the Newfoundland and Labrador government within months of winning its first contract here- in their district no less. As bad as that sounds, and it does sound bad, the fact that there appears to be an attempt to disguise the donations to Marshall is just as disturbing. Certainly Marshall must have known these two people. In 2007 those two donations to his election campaign ranked in the top five highest campaign donors for him (along with Humber Valley Paving). The natural conclusion I reach from all of this is that it is not simply coincidence that a Quebec firm, implicated in corruption in that province (ie its ownership of Genivar - now WSP), had two executives make $2,500.00 worth of donations each, and disguise the origin of those donations. Certainly, both Mr. Williams and Marshall have some answering to do, because this appears to be a case of "thank-you very much money", and if that were true, it would be illegal.

All the King's Men - Part 1 - Derrick Dalley

All the King's Men is a new series on stories involving public officials, public dollars, and electoral donations. This story involves Derrick Dalley, the MHA for The Isles of Notre Dame, the current Minister of Natural Resources, and, back in 2011, the Minister of Business.

Dalley was a marginal MHA in the Williams' government between 2007-2010. He barely won his seat in 2007, and the worry in 2010 was that he wouldn't win it in 2011. So, on January 13, 2011 he was appointed to Cabinet as Minister of Business. He also sat on the Public Accounts Committee from 2009 on.

It was during this time that a little known company, Eastern Star Group Canada Ltd, was making its way through the environmental approval process to establish a shell fish plant in Dalley's district - which was approved on December 22, 2010. And, less than two weeks after Dalley became the Minister for Business, the government approved a $500,000.00 loan to Eastern Star Group to create the business. The press release is here http://www.releases.gov.nl.ca/releases/2011/fishaq/0126n06.htm

Dalley had this to say:

"This project is exciting for a number of reasons," said the Honourable Derrick Dalley, Minister of Business. "The processing facility is being established in rural Newfoundland which will result in new employment and other spinoff benefits for the local economy.."

What Dalley didn't say is that the project approval was great personal news for him - especially the potential spin off benefits. You see, less than 9 months after Dalley personally approved the loan to Eastern Star Group, he was apparently rewarded with some hefty political contribution for his re-election campaign by the folks from Eastern Star Group. The company itself gave Dalley $3,500.00 in reelection donations. One of the principles of Eastern Star Group, Phillip Davis, Head of the Biochemistry Department at Memorial Univerisity, and Vice-President at Eastern Star Group, donated another $3,500.00 to Dalley's reelection fund. Finally, as much as I can tell, one Rhonda White, a biology technician at MUN gave another $3,000.00 to Dalley's election fund. That's a total of $9,500.00 in political donations made directly to Dalley's campaign after he personally approved a $500,000.00 loan to the company from the taxpayers. None of the donors gave money before or after to the PC Party, or Derrick Dalley - it was a large, one-off donation.

In case that doesn't get your blood boiling, there is always the rest of the story.. After Dalley lent the taxpayer's money to Eastern Star Group the company folded and the taxpayers lost all their money.In a strange twist to the story, found after doing a bit of research, it seems we weren't really getting the whole truth on eastern Star Group to start with. The hint comes in its official name: Eastern Star Group Canada Ltd. Yes, the emphasis being on the word "Canada". You see, the Chinese gentleman that was fronting Eastern Star Group in Newfoundland, Hettinger Chang, also had an operation going on in the states called Eastern Star Group Plc, which was also known simply as "The Eastern Star Group" on their:

website

http://www.easternstargroup.com/

 or on their Facebook site

 https://www.facebook.com/pages/The-Eastern-Star-Group/314373741916301

or simply on their Zoominfo site

 http://www.zoominfo.com/s/#!search/profile/person?personId=1584891737&targetid=profile

The fact is Mr. Chang's US business just didn't seem to exist legally in the US. There is no record of his company on any exchanges or ever being registered as a corporation in the State of New York. In fact, even the phone number given for his company in the states was fake, and actually belongs to a New York architect firm that has had it, as the lady said, "for decades". Its one claim to fame appears to be exporting a bit of coffee from Mexico to Russia in 2011 before it disappears from sight. In other words, it appears that not much due diligence was done by Minister Dalley, or his department, on Mr. Chang before the money was handed over.
Still can't believe it? Check out the registered office of Eastern Star Group Canada Inc in St. John's:

 https://www.google.ca/maps/@47.597581,-52.723235,3a,75y,321.5h,90t/data=!3m4!1e1!3m2!1ss02E83ykrEVF4i-O1pPK7A!2e0

Bottom line in all this is that it stinks. It stinks bad. And Derrick Dalley, the current Minister of Natural Resources, responsible for billions upon billions of dollars in project and decisions, is up to his elbows in it. I ask myself, how does a minister explain taking personal political donations for his reelection fund from a company that he personally approved a $500,000.00 loan for on behalf of taxpayers? How is it that these three people gave a total of $9,500.00 once, and once only, in the same year they received that loan? The obvious question is: was this a reward for Dalley bringing in the dollars for the company? If it was it would be illegal. Ask yourself why a technologist from MUN who lives in St. John's, a professor in St. John's who also acts as a VP, and a company that had to borrow money from us to live, make a one-time election donation to an MHA who lives in Twillingate? This is another case where an RCMP investigation should shed some light. Dalley, just another of the King's men.

Here are some links to stories surrounding this company:

http://www.cbc.ca/news/canada/newfoundland-labrador/shuttered-plant-got-loan-from-controversial-fund-1.1179913

http://www.cbc.ca/news/canada/newfoundland-labrador/500k-at-risk-as-provincial-business-fund-recipient-folds-1.1165744

http://www.cbc.ca/news/canada/newfoundland-labrador/twillingate-shrimp-plant-remains-closed-1.1161197

Muskrat Falls Contractors Political Donations to the PCs

Section 121 (2) of the Criminal Code of Canada lays out what it means to act in a  corrupt way when it comes to political parties and elections:

"Contractor subscribing to political fraud
(2) Every one commits an offence who, in order to obtain or retain a contract with the government or as a term of any such contract, whether expressed or implied, directly or indirectly subscribes or gives, or agrees to subscribe or give to any person any valuable consideration

(a) for the purpose of promoting the election of a candidate or a class or party of candidates to Parliament or the provincial legislature; or

(b) with intent to influence or affect in any way the result of an election conducted for the purpose of electing persons to serve in Parliament or the legislature of a province."

So, what does that mean? Well, essentially it says if in order to get or keep a contract with the government, whether its obvious or implied, you reward a politician or political party, you are guilty of corruption in Canada. That's a criminal offence.

So, is this happening in Newfoundland and Labrador? To start with, there are only three jurisdictions in Canada where corporate or union political donations are even legal - this province is one of them. That being said, just because it's legal to donate doesn't mean the guidelines of the criminal code don't have to be respected. That's where the grey area comes in.

The purpose of this post is to detail, to the best of my knowledge, the corporations that have received Muskrat Falls contracts since 2007, and the donations they have made to the PC Party. How they did it. Where they did it from. Just a note of interest, it's not just Canadian corruption laws that may apply here. The Bribery Act in the United Kingdom may also be applicable. You see, any company with a head office in the UK, or any company (say located in Canada or the US) that just has an office in the UK, is subject to their Bribery Act. That Act is far less stringent in qualifying what may be considered corruption. In other words, a number of these companies can be investigated for acts they are doing in Canada by the British justice system. It's not out of the question.

It is important to note that no one is guilty of anything unless they are investigated, charged and convicted. With that in mind, the contractors that have received contracts on Muskrat Falls, or the Lower Churchill in general, and made political donations to the PC Party are:


The following companies have head offices or offices in the UK and their donations:

AMEC                                                   $66,700.00

Fasken Martineau (QC)                          $45,650.00

SNC Lavalin (QC)                                 $51,025.00
(includes Spectrol Grp)

CIBC                                                     $38,270.00

TD Bank                                                $27,150.00

Gowlings (law firm)                                $17,600.00

RBC                                                      $16,250.00

Deloitte                                                 $  6,915.00

Strikeman Elliott (law firm)                    $   5,000.00

Anderson Sinclair (law firm)                  $   5,000.00

Johnson's Construction                            $ 5,000.00

The following companies have headquarters in the US:

Hatch Mott MacDonald                        $32,800.00

The following companies are primarily headquartered in this province,or elsewhere in Canada:

Pennecon                                             $60,700.00

Provincial Aerospace                           $60,700.00
(includes Provincial Airlines &
Liannu Partnership)

The Idea Factory                                 $29,000.00

G.J. Cahill & Company                        $28,200.00

Fugro Jacques (QC)                            $23,350.00

Woodward Oil Limited                        $20,000.00

H.J. O'Connell                                    $   4,500.00

Speutra Security                                 $   4,000.00
(through Spectrum Security)

These figures do not include 2013, as they are yet to be published. There may be more Muskrat Falls contractors donating at that time, and those that have donated likely donated more.

I tried to contact a number of these organizations, although not all, to get their side of this story. A number of them actually forbid donations or gifts to governments they are doing business with. Some have already been convicted of corruption offences, or are being investigated. For example, take AMEC. In 2009 it settled with the United States Department of Justice for $19,000,000.00 in kickbacks and frauds on the government involving US government federal contracts. AMEC apparently turned a leaf after that, and dropped political donations. In this filed annual report, 2011, http://www.amec.com/documents/investors/6.6_financial_reports/annual-report-governance.pdf

AMEC states:

"Our policy is not to make political donations and none
were made during 2011 (2010 – £nil)."

That is not true, however, as the company was making donations every year from 2007-2012 in this province. I attempted to get an explanation from AMEC, and I received two replies:

The first one:
 " Hi Brad, Wanted to let you know that I've just received your email from a colleague of mine in the UK and I am looking into it. Regards, Lauren."

Then this one days later:
" Hi Brad, I do not have any comment at this time. Regards, Lauren"

There is of course the well documented case of SNC Lavalin, and its political donations to political parties of all shapes and sizes, and its prosecution for bribery, etc. There was the case of the lawyer from Fasken Martineau, arrested and charged for using political donations to secure contracts in Quebec. Other s have been alleged to have participated in similar schemes:
http://www.bdlive.co.za/articles/2012/01/26/transnet-mum-over-findings-of-probe-into-contract-awards;jsessionid=45C235FCD1628DDC5F0731D1AE4DEC0F.present2.bdfm

Some companies are very upfront with these donations, while others have partners of their firms make the donations. This is particularly true of every law firm listed above. The amounts from each partner are, by coincidence, the exact same amount - but add up one way or another to a similar annual figure. It raises a number of questions. First, are these companies being lobbied for the funds by the PCs? Is there a list of companies with contracts that get hit up every year for a donation? The trend I've found is once these companies are on the PC Party's rolls they don't get off. Year after year - unless their business ends with the government. Likewise, some pop out from nowhere. Take H.J. O'Connell and Johnson's Construction. Johnson's just started donating in 2012, which just so coincided with it's Muskrat Falls work. Ditto for H.J. O'Connell. Johnson's construction is out of the UK, and H.J O'Connell is out of Quebec. Why were these two companies suddenly interested in donating to the PC Party here? The same question could be asked to any number of the companies above. Almost all of them donated exclusively to the PC Party. From all over the world, and all over the country.

Has the PC Party established a network to source out donations from contractors with government contracts? I know Terry French told the audience at the 2010 AGM, Election Readiness meeting to hit up paving companies, "cause they know where the contracts come from". It's difficult to be positive, without an investigation, but the trend seems to indicate that. Is that illegal? Well, as the law says: "whether expressed or implied". It is certanly illegal for a political party to request a donation of any kind from a contractor doing work for the government. One thing is certain, when the work dries up so do the donations. That is the trend. An investigation is required to determine the legality of this scheme.

If this upsets you, and you want to make a difference, you can confidentially report this to the Serious Fraud Office in the UK here http://www.sfo.gov.uk/bribery--corruption/where-should-i-report-corruption.aspx . Make a difference. It's important to our democracy.