Public Accounts Committee on March 19th, 2024

[David Yeo]

It was only one person then, because it was from my dining room table in Barrhaven, but we have grown.

It grew in 2008 to 2010 to 2012, and then we've obviously contracted a lot because our hardware business has all but dried up. We still do some professional services.

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

How much total money in public contracts has your company received?

[David Yeo]

From 2015 until now, we have had $91 million in contracts on TBIPS basically, the professional services contracts.

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

What is it exactly that your company does?

[David Yeo]

We're a hardware and software company as well as a professional services security company.

Basically, we go after government contracts as a general contractor. When it comes to our professional services, we hire our contractors through either subcontracting or potentially a JV with another company.

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

How many subcontractors does your company operate, given particular contracts, on average?

[David Yeo]

On average, not many. We usually do them ourselves, especially the hardware and software contracts.

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

How many subcontractors do you operate right now?

[David Yeo]

Again, that's a great question. I don't have that on the tip of my tongue, so I'll have to go back to the shop and ask them.

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

Yes, it would be great if you could supply that list as well.

[David Yeo]

For sure.

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

I want to turn attention to statements that were made by a firm known as Botler.

Their chief executive named Dutt told MPs in another committee that she feared Dalian's procurement policies were “another example of monetization and theft using the trauma of marginalized communities.”

Why do you think she said that?

[David Yeo]

I have my own opinions—there's no question about that—but I'm not sure I can give them here.

It's really an irrational statement, to be honest with you. I've been operating for 22 years with the government, with top secret clearances and top secret facility clearances. We are not a bricks-and-mortar company. I have an office on the seventh floor of 222 Somerset Street downtown, and Coradix is down on the fifth floor.

I believe that Botler, for what they've brought to this situation, were hired for four or five deliverables. They got through two of them, and CBSA cancelled their task authorization for whatever reasons.

We got that cancellation of the task authorization. We passed it on to GC Strategies, and it floated down to Botler, and they've been not necessarily the kindest to Dalian since.

The costing of this is small with respect to the ArriveCan application project.

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

Botler made clear that they were not certain your firm or other firms, in particular GC Strategies, were aware that there were that many subcontractors.

When did you become aware that there were subcontractors like Botler engaged in the same project you were?

[David Yeo]

I'm two gates deep in DND on a pretty much daily basis, helping them over there, getting the right capabilities into the right hands of the war fighters. I got right into this as quickly as I could in the fall, especially when Botler was making the waves they were, which I think was inappropriate.

No, as far as I'm concerned, it's unfortunate that Botler took that tack.

I don't know if I answered your question. I apologize for that. If I didn't answer your question, ask it again, please.

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

I'll ask it in a different way.

The issues that were brought forward by Botler include layers of subcontracting that hide key details about who is getting paid for what and the cozy ties between private staffing firms and, of course, those public servants who ultimately influence that decision.

Please comment directly on your knowledge related to the subcontracting and whether in your mind key details about who was getting paid for what were clear.

[David Yeo]

Subcontracting happens all the time. We are the prime contractor on a lot of contracts, and then we sub out a lot of our work to other subcontractors. It happens in every industry. It doesn't matter whether it's for pencils—

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

But the government is very particular. This is public money. It's very important to understand that we pay the utmost attention to the integrity of our public service.

Do you believe there were key details being hidden by way of multiple layers of subcontracting?

[David Yeo]

I'm not aware of that, no.

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

In my next round of questions, I'll speak to you directly with respect to your knowledge on subcontracting, how many other subcontractors there were, and the numbers associated with those subcontracts, as well as the task authorization process.

[The Chair, Conservative, John Williamson]

Thank you, Mr. Desjarlais.

We're opening our second round.

Mr. Brock, you have the floor for five minutes.

[Larry Brock, Conservative, Brantford—Brant, ON]

Thank you, Chair.

Good afternoon, Mr. Yeo.

I understand from earlier testimony that you became a public servant with DND on September 19, 2023. You last testified before a committee on October 31, 2023, approximately a month and a half after you secured full-time employment as a public servant.

I've read the transcript of your previous testimony. At no point in time, despite being asked several questions about the nature of your employment—you focused squarely on your directorship and your shares within Dalian—did you say anything about the fact that you were a public servant.

It begs the question: Why would you withhold that information from Canadians?

[David Yeo]

I appreciate the question.

This needs to be analyzed a little more. It was on September 19 that I joined the public service. It was 42 days later that the meeting came to us and we were invited as Dalian. I was invited to come to you and speak at OGGO as Dalian.

The understanding was that Dalian holds a top secret facility clearance. Those who know what a top secret facility clearance is know. I hold and I did hold a higher than top secret security clearance for Dalian. As well, in my short time of 42 days with the department, I also had a top secret clearance there and a secret clearance.

By virtue of that aspect and the fact that this had zero to do with DND, zero to do with what I was doing during the day as a high assurance specialist for the department and zero to do with my employment there, as well as the fact that—

[Larry Brock, Conservative, Brantford—Brant, ON]

Sir, I'm going to stop you there. My time is limited.

I don't accept your response, and I think most Canadians don't accept that response. After a month and a half, you were divesting your interests in Dalian. You had resigned as a director. You put all of your interests in a blind trust and you were working on a full-time basis with DND. Correct? You had no interest in Dalian, yet you gave the impression you were still an active participant in this two-person company. So, sir, with respect, I completely disagree with your word salad of an explanation because it just doesn't add up.

Now I'm going to move on to a monetary aspect.

You confirmed to my NDP colleague you've received $91 million in federal contracts since Justin Trudeau essentially took over government in 2015. What is your commission rate of that $91 million?

[David Yeo]

As a business, from Dalian's perspective, and these were TBIPS, professional services contracts—