Public Accounts Committee on March 28th, 2007

[The Chair, Liberal, Shawn Murphy]

At this point in time I'd like to call the meeting to order and welcome everyone here. In particular, I want to extend a very warm welcome to the witnesses. Bienvenue à tous.

This, colleagues, is a continuation of the hearing on chapter 9, “Pension and Insurance Administration--Royal Canadian Mounted Police”, contained in the November 2006 report of the Auditor General of Canada. The committee did hear earlier testimony from the Office of the Auditor General of Canada--actually it was the Auditor General herself--and other officials from the Royal Canadian Mounted Police and from the Treasury Board Secretariat.

This meeting more or less arises from a motion made by Mr. Wrzesnewskyj that certain other witnesses be called to a hearing to explain certain alleged--and I underline the word “alleged”--conflicts in what happened.

We have with us, as an individual, Mr. Ron Lewis. Mr. Lewis is a retired staff sergeant with the Royal Canadian Mounted Police. Mr. Lewis, welcome to the committee.

From the Royal Canadian Mounted Police we have Chief Superintendent Fraser Macaulay.

We also have Staff Sergeant Steve Walker and Staff Sergeant Mike Frizzell. In Prince Edward Island, we have Frizzells and Frizzals. Which are you? Frizzell. We also have Assistant Commissioner David Gork.

From the public service we have Denise Revine.

I want to welcome each and every one of you.

I understand certain of you have an opening statement. It is an option, not an obligation. I'm just going to go down the list.

Mr. Lewis, do you have an opening statement?

[Ron Lewis, Staff Sergeant (Retired), Royal Canadian Mounted Police, As an Individual]

Yes, I do, Mr. Chair.

[The Chair, Liberal, Shawn Murphy]

Okay. I'll ask you to give it.

I want to remind members that I will limit the opening statements to five minutes.

Go ahead, Mr. Lewis.

[Ron Lewis]

Ladies and gentlemen, I appreciate the opportunity to appear before you today to clarify the issues of concern in relation to the RCMP pension and insurance plans. In particular, I would like to thank the MP from Etobicoke Centre, Borys Wrzesnewskyj, who has taken the time to read between the lines of the OAG report and uncover the real story. His persistence and dedication to justice have been extremely helpful to allow this story to be told and are a great service to the citizens of Canada.

Before I address these issues, I feel it's important to briefly explain my role within the RCMP. I have been retired for over two years, after 35 years' service. During the last 10 years, I was a full-time elected staff relations representative for the members of RCMP national headquarters. I represented all ranks and levels, including management. Staff relations representatives perform duties similar to those carried out by unions and associations.

I first became aware of the serious wrongdoings concerning the outsource of the RCMP pension and insurance plan in early 2003 and other related wrongdoings by senior executive-level employees of the RCMP as far back as 2001, which are related to the whole story we're about to hear today. While trying to expose these wrongdoings, which were both criminal and code of conduct violations, I had face-to-face meetings with and produced written complaints up to and including Commissioner Zaccardelli. To my disappointment, I was met with inaction, delays, roadblocks, obstruction, and lies. The person who orchestrated most of this cover-up was Commissioner Zaccardelli. In retrospect, I failed in my attempt to rectify the wrongdoings, in my belief that the internal processes under the RCMP Act and related policies would do the job. I now know this to be untrue, after six years of trying. I've exhausted every process available, and now you, the lawmakers, are my last resort.

Several years ago I was advised by senior RCMP members, including the ethics advisor, who was also the integrity officer for the RCMP, that I would have to go outside the RCMP to resolve this matter, and they were correct. It is painfully clear that the RCMP could have nipped this in the bud back in 2001. However, management override of our processes has led us to your door and has tarnished the reputation of the RCMP. The processes of internal investigations require change. This is a long and complicated story. There were hundreds of allegations of wrongdoings recorded in the investigation reports. In fact, there were so many violations by Dominic Crupi, they could not be included in the 40-page summary.

I realize there are procedural and time limits. Therefore, I wish to be very strategic in my evidence. I do not intend to deal with minor details of the investigation or to re-open the investigation. We've missed those opportunities. I do wish to identify why this whole process has failed and offer solutions to prevent it from happening again. I will address the issues of which I have direct knowledge and documentation. I can relate 11 critical actions or omissions by Commissioner Zaccardelli and others that led to these failed investigations. I hope more details will emerge through your questions.

A culture was created by several senior executives where it became very dangerous for employees to report wrongdoings. The risk to their careers and financial well-being was high. On the other hand, wrongdoers were protected by these senior executives and supported by Commissioner Zaccardelli. This culture exists today, since some of these senior executives are still in place. But I wish to emphasize that the RCMP is not rotten to the core. The rot exists only within a small group of senior executives. Some are gone. Some have left recently. Some still remain. The good employees are still suffering emotionally, financially, and career-wise, while the wrongdoers are back on the job reaping benefits.

How did this whole process fail?

First, lateral-entry executives were brought into the RCMP to manage human resources, finance, and strategic direction. Some of these key individuals demonstrated substandard values and lacked the integrity expected of members of the RCMP. When these executives were found committing wrongdoings, they were protected by Commissioner Zaccardelli rather than punished.

Secondly, the senior executives of the RCMP have delegated authority, under the RCMP Act, for internal investigations and discipline. They determine if an investigation should be initiated, who conducts the investigation, who's to be charged, the type of discipline, and finally, they're involved in the appeal process. It's totally internal. Therefore, when allegations of wrongdoing are made against the senior executives, they are in a conflict of interest. The potential or even the perception of cover-up is real.

I have three recommendations.

One, an independent, external body or individual should be appointed to handle all allegations of criminal activity or violations of the RCMP Act when the subjects of the allegations are senior executives of the RCMP.

Two, all funds owing to the RCMP pension plan should be returned immediately. It was noted in the OAG report that hundreds of thousands of dollars are still unrecovered. Deputy Commissioner Gauvin indicated that only transactions of more than $50,000 were reviewed. All transactions should be reviewed.

Three, the OAG report, in paragraph 9.51, recommended that the RCMP develop charging principles for its insurance plans and review the amounts charged for outsourcing insurance plan administration according to these principles. This is very important: as long as Deputy Commissioner Gauvin is in charge of finance for the RCMP, there will be a conflict of interest, since he was accountable for the violations in the first place. An independent evaluation is required.

Thank you very much. I would like to table the documents that will support my allegations today, along with a longer version of my opening statement, which I prepared because I didn't think I'd get the full story in.

Thank you very much.

[The Chair, Liberal, Shawn Murphy]

Okay.

Those documents, I assume, are not in both official languages, are they?

[Ron Lewis]

They're not. They're mostly under my—

[The Chair, Liberal, Shawn Murphy]

Leave them with the clerk, sir, and we'll get them translated and table them with the committee. Okay?

On that note, before I go to the next witness, I want to do a bit of housekeeping. On this issue, there is a letter to me as chair, dated March 1, from Commissioner Busson, with an attached memorandum dated June 20, 2005. That document and the attachment have been translated and circulated to all members. Everyone has it, and I'm going to officially table it now with the committee.

Yes?

[John Williams, Conservative, Edmonton—St. Albert, AB]

Mr. Chairman, I refer to the blues of our meeting on February 21. On page 10--it was you speaking, Mr. Chairman--you said:

I suggest that the commissioner, assisted by Ms. George, undertake to provide us in writing the circumstances surrounding the so-called alleged dismissal of Sergeant Frizzell.

Further on, on the same page, Barbara George says:

If such a document exists, we will get that and provide it to you.

And the commissioner says:

You have my undertaking.

I thought the undertaking, Mr. Chairman, that you had asked for concerned the circumstances surrounding the situation, and all we have is a memo. The memo is fairly explicit, but the point is I thought the commissioner would have taken the direction of this committee and kind of fleshed out the whole situation and given us a full comprehensive understanding, rather than just sending on a memo. I have to say how disappointed I am at the commissioner, Mr. Chairman, that she would think that a memo she dug out of the files would suffice.

[The Chair, Liberal, Shawn Murphy]

Okay. Thank you, Mr. Williams.

Following your intervention, I think it would be appropriate to go back to the commissioner and ask for what was.... We'll give her the exact wording of the undertaking that was extracted from her at the meeting and ask her for a full and frank undertaking.

I'm going to move on to the next opening statement, but I'm going to remind witnesses.... I did give Mr. Lewis—and perhaps this was my own fault—a little leeway in time. We are going to have to stick to the five minutes. I'm going to take the list.

Chief Superintendent Fraser Macaulay.

[C/Supt Fraser Macaulay, Chief Superintendent, Royal Canadian Mounted Police]

Thank you, Mr. Chair.

Good afternoon, committee members. Thank you for having us here today.

I would like to introduce Ms. Denise Revine, who is a former director with the human resource sector and has over 36 years of service with the RCMP. Ms. Revine is a public servant who uncovered the pension and insurance fund wrongdoings. Ms. Revine has been the main information gatherer, authoring a number of reports and letters, in our quest for action on this file. She will be able to respond to questions surrounding some of the issues and the timeline of events.

I presently work in community contract and aboriginal policing in Ottawa, and I have 27 years of service. At the time these wrongdoings were reported, I was a director general within human resources.

Before I get to the heart of my opening statement, I would like to set the stage as to why we are here today. For the past several years, the RCMP has had a small group of managers who, through their actions and inactions, are responsible for serious breaches in our core values, the RCMP code of conduct, and even the Criminal Code. I say “a small group of managers” because I believe it is very important to emphasize that we are not talking about the core business of the RCMP or the approximately 24,000 employees who carry out policing or administrative functions across this country on a day-to-day basis.

In fact, the employees of the RCMP were the victims in this matter. They had blind faith in those entrusted with the care of their pension and insurance funds. For the most part, they still do not know how some $30 million or more was spent over three years on pension and insurance outsourcing.

l would like to clearly state that we are here today, almost four years after reporting these matters to Commissioner Zaccardelli, because we believe he abdicated his responsibility by not immediately addressing the fraud and abuse reported to him and that there were inappropriate actions taken to suppress the facts and mislead employees. For the record, we are here because it is, and it always has been, the right thing to do. It is not, as Mr. Fitzpatrick stated at this committee on February 14, “maybe, unhappy ex-employees trying to get their things in”.

With that said, let me get right to the point. While we do not dispute the Auditor General's findings, it is important for the public accounts committee to note that these findings are based on the examination of one year only. The issues raised before you today cover six years. They were brought to the attention of the OAG auditors in October 2005. It is our understanding that because the allegations fell outside the scope of the AG audit, these could not be examined.

By the time the full disclosures were uncovered and reported by Ms. Revine in early June 2003, the RCMP had already spent over $25 million, committed an additional $10 million in contracts for 2003-04, and was forecasting another $20 million in expenditures before the end of 2005-06. In other words, the reported historical and projected cost breakdown was escalating to just under $55 million. This was a far, far cry from the original $3.6 million of cost projections in the business plan submitted on July 17, 2000. This abuse had to be stopped.

The evidence presented to Commissioner Zaccardelli, which he in turn submitted to his director general of audit and evaluation, Mr. Brian Aiken, on June 17, 2003, was credible, undeniable, and convincing. The commissioner was made aware of the misappropriations of funds, the threats, the excessive spending, the serious staffing and contracting violations, and the gross abuses of power and authority.

Ten days later, on July 4, 2003, l signed separate formal memos to the attention of both Commissioner Zaccardelli and Mr. Aiken, bringing forward a more detailed and comprehensive picture of the corruption. There was ample proof that fraud and abuse were present. Given the overwhelming excesses, any reasonable person would have suspected criminal activity.

It was shortly after that that Deputy Commissioner Barb George informed me that l would be removed from my position. Assistant Commissioner Vern White, now retired, filed a formal complaint against me for having raised suspicions of misconduct around Mr. Dominic Crupi. My punitive assignment was a two-year secondment to the Department of National Defence. Let me add that this in no way reflects upon the Department of National Defence, but for me, being removed from my position was a punishment and a clear message to others.

On September 23, 2003, at the prospect of experiencing further tactical delays from the auditors and more cover-up and retaliation, Ms. Revine formally wrote to the RCMP ethics advisor, Mr. John Spice, requesting his intervention with the commissioner. She outlined all the issues in a lengthy e-mail. On October 16, 2003, l personally met, for a second time, with Commissioner Zaccardelli, to no avail. We will be tabling all of these relevant documents.

It took many interventions and almost a year to bring this to a criminal investigation. Shortly after the criminal investigation was announced, Ms. Revine's work was reassigned and she was served a letter by Rosalie Burton instructing her to report to the Public Service Commission for a priority placement elsewhere in government.

It is important for committee members to note that Ms. Burton was a patronage appointee who was brought into the RCMP and promoted into the EX ranks by Deputy Commissioner George as a favour to Mr. Jim Ewanovich, the former CHRO. It should also be noted that both Ms. Burton and Deputy Commissioner George were persons of interest in the Great West Life insurance investigation.

On February 21, Chief Bevan made a comment that I found very interesting: "What persuaded the Crown—”

[The Chair, Liberal, Shawn Murphy]

Chief Superintendent Macaulay, I'm sorry, I'm going to have to interrupt your—

[John Williams, Conservative, Edmonton—St. Albert, AB]

Mr. Chairman, if it's the will of the committee, I think we should allow him to finish, because he's making some serious statements here.

[The Chair, Liberal, Shawn Murphy]

If it's the will of the committee, that's fine.

Do I hear this as the will of the committee?

Okay.

[Pablo Rodriguez, Liberal, Honoré-Mercier, QC]

What is going on here is much too important to have such rigid rules. Mr. Lewis and Mr. Macaulay could have continued. If necessary, we will take more time.

[The Chair, Liberal, Shawn Murphy]

I'm just applying the rules and I'm at the orders of the committee.

Please continue, Chief Superintendent Macaulay. I think you have about another minute and a half anyway.

[C/Supt Fraser Macaulay]

On February 21, Chief Bevan made a comment that I found very interesting:

What persuaded the Crown was that there was no evidence that any money had gone from any of the pension funds or insurance system into any individual's pocket, which is a determining factor for the misappropriation of funds.

The truth of the matter is that the investigation was shut down prematurely, preventing the investigators from being able to link the numerous gains, promotions, performance pay, hiring of relatives, kickbacks, and prospects of future consulting work to the abusers of the pension fund.

Even under these circumstances, 21 individuals were highlighted as having committed possible code of conduct offences. Yet not one of them was held accountable for their actions. In fact, a number of employees were promoted immediately following the conclusion of the investigation.

Mr. Paul Gauvin tabled a document this past year to senior executives in the force in which he stated that when managers abuse their responsibilities, they should suffer personal and professional consequences, including disciplinary action, the removal of delegated authority, negative annual performance ratings, and/or removal from position or the loss of employment.

I do not know about you folks, but I find this deceptive and hypocritical, when you consider that he was the deputy commissioner of finance during the whole affair.

As the deputy commissioner of corporate management and comptrollership, a member of our pension advisory committee, and a member of our subcommittee on finance since 1999, Mr. Paul Gauvin was very familiar with the outsourcing project right from its inception. However, as Mr. John Williams said on February 1, 2007, at a committee meeting, “Everybody walks away....”

I quote the RCMP commissioner's 2007 directional statement:

Parliament and taxpayers expect government programs and services to be delivered in an ethical, open and accountable manner. As Canada's national police force we must hold ourselves to an even higher standard. The RCMP must be a model of ethical and responsible management behaviour. As a leader of policing and management excellence, the RCMP must continue to make sound stewardship a part of its culture.

I would like to bring my statement to a close by talking about the present commissioner. After her appearance here before you on February 21, 2007, Commissioner Busson reached out and gave me an opportunity to meet with her.

As a result of that conversation, we met as a group of five with the people who are here today, and she began trying to understand the events and actions that took place around this matter. Since that time she has taken an active interest in trying to determine the facts, and she has demonstrated to each of us that she is pursuing and will continue to pursue the truth.

I can assure you of two things. One is that if it were not for this committee's having carried out its role on February 21, we would not be here today; and two, that Commissioner Busson is a new leader who is letting her actions do the talking for her. If only it were June 2003.

Thank you.

[The Chair, Liberal, Shawn Murphy]

Mr. Macaulay, I just want to point out for the committee that there's another slight problem here that no one is to blame for at all. We have a number of opening statements, and a lot of work and effort went into them. But they're not done in both official languages, so they're not being circulated. These statements will be translated and circulated in due course.

These people don't have the resources that other people within departments have, so there's no blame and no problem. But this is the fact of life we're dealing with; I just want to point that out.

Staff Sergeant Walker.

[S/Sgt Steve Walker, Staff Sergeant, Royal Canadian Mounted Police]

Thank you, Mr. Chair and committee, for inviting me to discuss the investigation of the RCMP pension and outsourcing.

As an RCMP lead investigator with the Ottawa Police Service-RCMP investigation, I'd like to take this opportunity to provide committee members with a quick overview.

In April 2004 I was seconded from the Winnipeg RCMP major crime service to assist the Ottawa Police Service in setting up a joint investigation into allegations of wrongdoing within the RCMP pension administration and insurance outsourcing. This investigation would encompass allegations of fraud relating to Treasury Board fenced funding, violations of the Financial Administration Act, breaches of the Treasury Board regulations and directives relating to contracting and procurement, violations of the North American Free Trade Agreement, and a host of allegations relating to hiring irregularities associated with nepotism and favouritism. Investigative observations showed a wanton disregard for accepted accounting practices and a management override of financial controls and accountability, which led to wasteful spending and borderline criminal behaviour. These behaviours went well beyond being administrative in nature.

For the past 133 years, the RCMP has striven to secure and maintain public trust and confidence, based upon strict adherence to a set of entrenched core values that we attempt to identify in every employee who enters our service. These core values are honesty, integrity, respect, compassion, professionalism, and accountability. It is through strict adherence to these values that we, the national police service, assure the public that we are beyond reproach and can be held to the highest moral and ethical standards that far exceed the expectations of most private and public institutions.

The mechanisms for ensuring the adherence to core values are accountability and supervision. The most dangerous consequence of poor accountability and supervision is corruption. The lack of proper accountability and supervision has been stated as an important contributing factor to corrupt behaviour. Proper supervision and accountability allows managers to identify the warning signs by ensuring that rules are adhered to, so they can remove the opportunities for corrupt behaviour. Corruption has a tremendous impact on public trust, faith, and internal morale.

As a lead investigator with this investigation and as a member of the RCMP with over 26 years of service, I have never heard of or witnessed such wholesale violations of all our core values as I have seen and observed in the course of the pension investigation. The apparent lack of accountability and unethical conduct by some of our senior managers within the RCMP financial and human relations sector can only be translated to a failure of the basic principles of modern comptrollership and financial stewardship that were required by all levels of RCMP management. These failures were identified at so many levels--by the RCMP financial audit, the OPS-RCMP criminal investigation, independent financial forensic reviews, and the Auditor General' s report.

In retrospect, and because of my policing background, I can now look back and say that when I arrived in Ottawa in April 2004 with a two-month mandate to get this investigation completed, I believe we were intended to give this a quick once over and to minimize the allegations. After our initial review, and within six weeks, it became evident that this was a very complicated and involved investigation. It was also obvious that we had neither the mandate, the tools, nor the human resources to complete this investigation in an expeditious and professional manner.

It took four months to convince both the RCMP and the OPS that proper funding and resource allocation would be required to thoroughly investigate the allegations that had surfaced. We were five months into the investigation before a plan was approved, and it was at this time that pressure was already coming to bear from the RCMP sources to get the investigation completed. From the first planning meetings of the investigation, our team was given commitments for additional resources, but after eight months no substantial change had been effected, and l began to suspect the possibility of not being able to complete this investigation in an independent and thorough manner. As I had been brought to Ottawa to do a two-month investigation, my family was very reluctant to see me extend my tenure past this point into a ninth month, and I reluctantly asked to be returned to Winnipeg to be with my family and to continue my duties with major crime. At no time did l sever my involvement with the investigators. l had regular phone contact and helped with reports, interviews, and consultation from a distance.

At this point in time, I can now say, as a member of the Royal Canadian Mounted Police, that I am disappointed and disillusioned that both the criminal and internal processes have failed to bring any degree of accountability. I am devastated that every core value and rule of ethical conduct that I held to be true and dear as a rank-and-file member of the RCMP has been decimated and defiled by employees at the highest levels of the RCMP.

This investigation and the outcomes are nothing short of sickening to any loyal and dedicated employee of the RCMP. My observations during this investigation and the evidence collected have led me to believe that actions or lack thereof should have resulted in the removal from management of a host of individual employees, and at the very least, quick internal sanction to ensure accountability. This should have been done to send a loud and clear message to all levels of management that corrupt conduct will be swiftly and severely dealt with in our national police service. The public expects this, and so do the employees and members of the Royal Canadian Mounted Police.

To date we have seen only two management-level employees leave our organization as a result of this investigation. These employees did not leave as a result of official sanction.

Millions of dollars in pension fund and insurance moneys have been subject to misuse and misappropriation and spent in violation of rules surrounding fenced funding and Treasury Board directives. The activities surrounding these pension funds went well beyond being administrative in nature. Most trained police officers would view some of these activities as nothing short of criminal in nature. Just because you may not be able to prove the allegation beyond a reasonable doubt in a court of law does not make the action any less criminal and purely administrative. This appears to have been the mindset of the RCMP management, who have since provided review and interpretation of audits and investigations.

The RCMP chief financial officer should be the RCMP leader in the area of modern comptrollership and financial ethics. He would be accountable and answerable as the CFO of the RCMP based on the rules of accountability he himself approved and instituted during his initial tenure as RCMP CFO from 1999 to 2003, which covers the period of the pension and insurance outsourcing.

It was also during this period that the RCMP was subject to investigation, review, and criticism by an Ontario Provincial Police investigation into contracting irregularities and breach of trust relating to renovations to the commissioner's office and other financial issues. During this period the RCMP was investigated and sanctioned for financial and accounting issues associated with the Gomery inquiry.

How many times is an organization allowed to make the same mistakes before someone is held accountable at the highest levels and positive change can be seen by our employees and the taxpayers?

Thank you.

[The Chair, Liberal, Shawn Murphy]

We're now going to hear from Staff Sergeant Mike Frizzell.

[S/Sgt Mike Frizzell, Staff Sergeant, Strategic and Operational Support, National Child Exploitation Coordination Centre, Royal Canadian Mounted Police]

Thank you.

You've heard the overview and rundown of what has happened in the past six years. I'm going to concentrate on one very small part of the investigation, but it's a little tricky, so I'm going to do my best here. It's about the insurance outsourcing.

Before I begin, I'd like to make note of the fact that the RCMP is a national icon in Canada and an international symbol of Canada around the world. No organization achieves such lofty heights without there being those who wish to knock it down to size. On the other hand, there are also those who will do their best to maintain that iconic status at all costs, as they believe the public will accept nothing less than perfection.

I am in neither group. I believe that organizations are made up of people, and as such they will make mistakes. I believe the public will understand and forgive as long as they know that we are doing everything we can to avoid making mistakes in the first place, to learn from the mistakes we do make, and to make darned sure they never happen again. Our ethics and integrity must be beyond reproach.

Having said that, I'd like to tell you a little bit about the insurance administration portion of the investigation. The insurance outsourcing was not part of the original investigation. That's why you always hear it referred to as the pension investigation. It drew our interest when we noticed that pension funds were being funneled into the insurance plans. We looked at it further, and here are some of the things we found. I won't be able to go into everything because of the time restrictions, but this will give you an idea.

For over 50 years the members of the RCMP have been part of several group insurance plans underwritten by the same company and, until recently, administered by the RCMP on behalf of our employer, the Treasury Board of Canada. A few years back the National Compensation Policy Centre of the RCMP--I'm going to refer to them as the NCPC--realized that the computer system the insurance data were stored on was unreliable. They had to look at new ways, then, of dealing with administering the insurance. Without any real analysis, it was decided to outsource the insurance administration.

This was the more expensive option, so NCPC should have gone to Treasury Board to get both authorization to outsource as well as the extra funds required. Instead they went to what's called the insurance committee. The committee was not told of the risk to the RCMP. Instead they were told, “This is just the way things are going these days; the government wants you guys to carry your own plan, so you don't really have any choice in the matter”. Without being fully informed, the insurance committee reluctantly agreed that the administration costs could come out of the members' premiums account.

At this point a competition to select an insurance administrator should have happened, but this would have taken time and drawn attention to the fact that NCPC was trying to outsource the administration of both the pension and the insurance at the same time. So, instead, NCPC asked the insurance underwriter if they would take on the administration. NCPC was counting on the fact that no one would question the underwriter becoming the administrator, because the average person wouldn't distinguish between the two roles. It worked. The underwriter agreed to look at becoming the insurance administrator, and no one questioned it.

Unfortunately, around a quarter of a million dollars was drained from the insurance funds before the underwriter decided they could not do the administration, so no work was received for that money. By this time, though, a pension administrator had been chosen through a competitive process, so the NCPC told the insurance underwriter, “Keep it under your hat; we're going to see if we can strike a deal with the pension administrator to take on the insurance as well.”

They were successful in striking a deal. However, they were left with two problems. Number one, costs for the administration had doubled, and that would be noticed coming out of the accounts, so that's when they decided to dip into the pension funds to augment the insurance costs. They also needed a plan to circumvent the government contracting rules and avoid a competitive process. What they did was ask the insurance underwriter to pretend that they were going to be the insurance administrators, and then they would sublet those responsibilities to the pension administrator. I know that's confusing, but it gives you an idea anyway.

This actually worked, and no one noticed anything. This arrangement stayed in place until the pension investigation. Once it was determined by the investigation what had happened, I took the information directly to senior managers, who I thought could put an end to it and ensure that the moneys were repaid.

As the investigation was closing up, I learned that despite assurances to the contrary, the money was still being drained from the insurance plans, and in fact over half a million dollars had recently been taken out. There's presently an investigation going on into the minutes of that meeting having been falsified.

The general membership and pensioners of the RCMP have never heard this story fully explained to them, and they deserve better. They need to be able to concentrate on doing their work for Canadians without having to worry that they're being taken advantage of by the people who should be looking out for them.

I'm asking you today to help us restore the faith of the rank-and-file members of the RCMP and show them that their hard work for Canadians is appreciated and that the RCMP is measured by their hard work and dedication to their communities, not by the self-serving actions of a well-placed few.

Thank you.

[The Chair, Liberal, Shawn Murphy]

Thank you very much, Staff Sergeant Frizzell.

We're now going to hear from Assistant Commissioner David Gork.

[A/Commr David Gork, Assistant Commissioner, Royal Canadian Mounted Police]

Thank you, sir. Before beginning, I would like to answer a question that was asked about commissioners.

It was about what she was supposed to provide regarding Mr. Frizzell and any issues associated with that.

One of the reasons I am here today is to respond to any questions with regard to that, because I have personal knowledge and I was personally involved in that. One of the reasons why the commissioner asked me to be here today was for this particular reason. Hopefully, Mr. Williams, that may respond to your earlier request.

With the chair's permission, I will carry on with my opening statement.

I have been following the deliberations with great interest, and I'm happy to contribute what I know. I'd like to respond as fully as I can to your inquiries with respect to the Auditor General's findings on the appearance of bias in the conduct of the criminal investigation into the administration of the RCMP pension funds conducted by the Ottawa Police Service.

I'm going to be very quick, because I'm going to try to stay within the time limits. This is not defensive; it is just trying to be factual.

I have been described as the senior RCMP officer responsible for the pension fund investigation. This is inaccurate and untrue. The Ottawa Police Service was responsible for the investigation at the beginning, throughout, and in the end. The Ottawa police conducted the investigation under their own auspices and without RCMP direction. The Ottawa police investigation operated in constant and full contact with their crown prosecutor, in their jurisdiction. The chief of the Ottawa Police Service, Mr. Bevan, reported the findings of the investigation directly to the Commissioner of the RCMP.

I did have a direct relationship with the senior investigator from the Ottawa Police Service, Inspector Paul Roy. My job was to open doors for him and his team; to obtain resources, both financial and in terms of personnel; and to provide physical accommodation for them. During the investigation, I had my own responsibilities in the RCMP, as the director of technical operations.

From time to time during the investigation, I was consulted by the Ottawa police about how they could access officers who were out of the country or difficult to contact, and how to obtain more investigators and physical resources, such as computers and office space. At no time did I direct the investigation or have access to information for purposes of subverting a thorough and diligent investigation. When anybody indicates that it was prematurely shut down, then I think this committee owes it to itself to know the truth by calling on Inspector Paul Roy, who was the lead Ottawa Police Service investigator; his lead investigator, Staff Sergeant Bill Sullivan; and the RCMP lead investigator, Staff Sergeant Stephen St. Jacques.

With respect to personnel resources provided to the investigation, I solicited investigators from divisions of the RCMP across Canada to obtain the available police officers to contribute to the investigative team. The Ottawa Police Service managed and directed their activities and ultimately reported the findings.

You will undoubtedly want to know when an RCMP member of the investigative team was removed from the overall team. This was done because of actions that were not acceptable on that person's part, and it was done after the investigation was over.

As the senior officer of the RCMP, I was responsible for the conduct and deportment of RCMP officers assigned to this particular investigation. That is because those officers come under the RCMP Act. The Ottawa Police Service has no jurisdiction under the RCMP Act.

Most of the RCMP members were separated from their normal chain of command during the investigation, and they took their direction for operational work from the Ottawa Police Service senior investigator. However, when an individual RCMP member required leave, required funding, required expense claims signed, or crossed the line in deportment or behaviour, it was my responsibility to address those issues.

A massive investigation such as this one, the scope of which is well known by you, is a team effort. Any deviation from the team culture diminishes the credibility of the team, damages the effectiveness of the investigation, and puts the truth in peril. I was the responsible authority in exercising my responsibility for the integrity and conduct of the RCMP members. It was I who signed the removal order at the request of the lead Ottawa Police Service investigator, Inspector Paul Roy.

Some of the points I would like to underline before I finish are the following. What I can say should and I hope will be corroborated by other witnesses, such as the lead investigator for the RCMP who reported directly to the OPS; investigators from the team itself; and the OIC for the OPS investigation, Inspector Paul Roy, and their lead investigator, Staff Sergeant Bill Sullivan, both very experienced and trusted investigators.

I have one concluding observation, Mr. Chairman. An original request that was in the blues notes, I noted, referred to the imposition of a gag order. It in fact was a non-disclosure order, and it was served on the team and all witnesses to ensure that there was no indication given to other persons involved prior to their being interviewed. As some of our investigators were RCMP regular members, governed again by the RCMP Act, it was only the RCMP that could hold them accountable to a direct order. The OPS could not do this. This was not designed to silence investigators but to ensure that information was not passed between others being investigated. It was served on the investigators.

All investigators were advised that if they felt there were any concerns that had not been addressed in the investigation, or if they felt another issue had been identified during the course of investigation that did not pertain to this particular investigation, they were to include these points in their final report. That final report was to the OPS, not to the RCMP.

If this committee truly wants to know the full story, then I would strongly urge you to consult with the officer in charge of the investigative team, Inspector Paul Roy, and the other lead investigators I have mentioned, Bill Sullivan and Stephen St. Jacques. This is the only way to clear up any doubts you may have, and I would hope these hearings are interested in the full story, not just one side of it.

[The Chair, Liberal, Shawn Murphy]

Thank you very much, Assistant Commissioner David Gork.

Before we go to the first round, witnesses, we've had what I consider to be some fairly serious conflicts in testimony on the actual investigation. Considering that it's coming from the chief police agency in Canada, I do just want to remind all witnesses that you're deemed to be under oath at this hearing. That includes all statements made in your opening remarks and statements in response to questions from the members of the committee.

[John Williams, Conservative, Edmonton—St. Albert, AB]

[Inaudible—Editor]

[The Chair, Liberal, Shawn Murphy]

Yes, that's another point, Mr. Williams. You're quite correct.

If there is civil or criminal litigation going on—I understand there isn't and that there can't be—the testimony here is protected under parliamentary privilege and it cannot be used in a court of law.

Having said that, I'm going to go to the first round. We're going to have a round of seven minutes.

Mr. Wrzesnewskyj, the floor is yours.