Public Accounts Committee on Aug. 8th, 2024

[Nathalie Sinclair-Desgagné, Bloc, Terrebonne, QC]

Thank you, Mr. Chair.

Commissioner, I'm going to circle back to my previous questions about employees. We agree that they're not appointed by the government, but I'd like to ask you a question about ethics, even though a conflict of interest may not be involved as such.

In one case, a Canada Border Services Agency employee came before the committee and admitted that he had been invited to a number of activities, including a whisky tasting, by a company the government was doing business with. Not only does this employee not appear to have suffered any retaliation or even been subjected to an internal investigation, but on the contrary, he was promoted. Does that seem ethical to you?

[Konrad von Finckenstein]

As I said to your colleague, I don't deal with general ethics issues. Obviously, people who conduct themselves as you described shouldn't be promoted, but it's not up to me to decide. My opinion is worthless here, because it's not under my jurisdiction. There are other agencies that handle that.

[Nathalie Sinclair-Desgagné, Bloc, Terrebonne, QC]

Yes, you're right. However, I wouldn't say your opinion is worthless. You are, after all, the Ethics Commissioner and an officer of Parliament responsible for administering the Conflict of Interest Code for Members of the House of Commons.

From my point of view and that of those who follow our work, the fact that you agree that it really doesn't seem ethical shows that there's clearly an operational issue at the Canada Border Services Agency related to this employee's presence and how he was treated, even though he admitted he shouldn't have behaved that way with suppliers. So we agree that this is quite problematic.

I have another question about this kind of conflict of interest. In the ArriveCAN case, we also heard that thousands of emails had been deleted. It's not necessarily ethical to delete compromising emails, but is it illegal? Could you enlighten me on that, or is it really outside your area of expertise?

[Konrad von Finckenstein]

I find it highly suspicious that those emails were deleted. I don't know what the rules are there, but they may have been broken. As to whether it could be a criminal offence, I don't know. Like you, I find it extraordinary that something like that was done, especially since you and the Auditor General are looking into this situation. They should have provided all the documents and emails to you rather than deleting them.

[The Chair, Conservative, John Williamson]

Thank you very much.

Up next is Mr. Desjarlais for two and a half minutes.

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

Thank you very much, Mr. Chair.

I do want to comment quickly on the situation at Sustainable Development Technology Canada, which was brought up earlier.

A question I had during some of our original testimony in hearing from SDTC was regarding the condition of protection for the whistle-blowers. I'm certain that over the course of time—I know you're relatively new—within the Office of the Conflict of Interest and Ethics Commissioner there have been instances where whistle-blowers have maybe come to other departments, including this department.

How do you deal with ensuring the protection of whistle-blowers when you conduct your work?

[Konrad von Finckenstein]

If people come forward to us with evidence that amounts to a conflict of interest and we think there's reason to believe an investigation is required, we will investigate.

If it involves a whistle-blower and that whistle-blower says that they do not want to be mentioned and that they want to remain anonymous because they're afraid for their job, then it causes us an issue, like everybody else. How do we deal with this? How can we protect them? On the other hand, how can we assure ourselves that what he or she divulges to us is correct or not?

You're asking me to speculate here. We would probably deal with the situation or the facts that he or she has presented and try to verify them without bringing him or her into the picture. If it's not possible, then we really have the unfortunate choice, if he or she doesn't want to testify, of do we have enough facts or evidence to proceed or know that it may be true? If he or she is not willing to testify and that's essential, then we have to close it down.

These are very difficult issues when you're not dealing with criminal [Inaudible—Editor]. We have no whistle-blower protection or anything like this.

I might very well tell the person to go to the Public Sector Integrity Commissioner and talk to her because she has a specific mandate to protect people against retaliation in case there is whistle-blowing.

To my knowledge, we have not had any situations like that. If it arrives, it will require very delicate handling. That's all I can say at this point.

[The Chair, Conservative, John Williamson]

Thank you very much.

That is your time, Mr. Desjarlais.

Mr. Perkins is joining us online.

You have the floor for five minutes.

[Rick Perkins, Conservative, South Shore—St. Margarets, NS]

Thank you, Mr. Chair.

Commissioner, I'd like to ask you about the Verschuren report that you issued on the Liberal green slush fund, SDTC.

In the report you acknowledge that you were aware of the parliamentary hearings, as well as the Auditor General's work in this area. Is that correct?

[Konrad von Finckenstein]

Yes.

[Rick Perkins, Conservative, South Shore—St. Margarets, NS]

You were aware that the Auditor General, as part of a report, identified nine order in council appointments to the board who had voted in conflict of interest—not just the one in Mr. Barrett's letter.

Earlier, you said that you only deal with order in council appointments. Will you look at the other eight? Those eight voted 186 times out of 400 times—400 votes, 400 transactions, 186 conflicted and 44% of those nine directors. That's not bad legal advice; that's a culture of conflict of interest.

[Konrad von Finckenstein]

Would you please repeat your question exactly? I want to make sure that I don't misunderstand you.

[Rick Perkins, Conservative, South Shore—St. Margarets, NS]

The Auditor General identified nine order in council directors who, 186 times, voted in conflict of interest out of 400 transactions. That's 44% of order in council appointments and almost half of the money—$330 million—that they voted companies they had a conflict of interest in. That's not bad legal advice, as you suggested in your report, is it? That's a culture on the board of conflict of interest and of self-dealing.

Would you look at all nine directors and those instances of conflict of interest?

[Konrad von Finckenstein]

Let's get the facts straight. I was asked to look at two order in council appointments, and I looked at them and their activities—

[Rick Perkins, Conservative, South Shore—St. Margarets, NS]

I know that. I'm sorry, Commissioner. That was from Mr. Barrett's letter—

[Konrad von Finckenstein]

Yes.

[Rick Perkins, Conservative, South Shore—St. Margarets, NS]

You have the ability to investigate beyond being asked, I would assume.

In that, Ms. Verschuren also voted herself—and you didn't cover this—or the board gave her companies $10.4 million from companies she had an interest in: Hydrostor, Cascadia Seaweed, Mangrove Lithium and Resonant.

Those are outside of the COVID payments. Did you look at those?

[Konrad von Finckenstein]

Are you suggesting that she did not recuse herself? Are you suggesting that she voted—

[Rick Perkins, Conservative, South Shore—St. Margarets, NS]

I'm suggesting she created a culture of conflict of interest with nine directors all voting themselves half of the money from the green slush fund, and you haven't looked at it. I want to know why you're not looking at probably the largest scandal in terms of dollars in conflict of interest not only in this government, but in decades.

[Konrad von Finckenstein]

Michael, why don't you—

[Michael Aquilino]

Yes, I'll jump in here.

The report makes clear that the commissioner did examine every vote of every meeting in which Ms. Verschuren was the chair. We didn't name specific companies that were the ultimate beneficiaries. The focus of the examination in large part was the involvement of accelerators in which Ms. Verschuren was associated, the Verschuren Centre and MaRS Discovery District, who were nominating other companies for funding. In that regard, we have a breakdown of—

[Rick Perkins, Conservative, South Shore—St. Margarets, NS]

I understand that, but that's only one aspect. I'm sorry, but I have limited time. That's only one aspect, and I'm curious as to why you're not looking into the broader issue of the $400-million scandal. The Auditor General identified $330 million of conflict.

One director who sat on the board, named Andrée-Lise Méthot, who is from Quebec, in her time on the board had $97 million go to companies she has venture capital interests in. That has all been identified. Nine directors in the Auditor General's report are all order in council appointees.

Why are you not investigating those conflicts?

[Konrad von Finckenstein]

Order in council appointees come in two varieties. You have reporting public office holders and you have public office holders. Public office holders are those who have to comply with the act, but they do not have to, at the beginning of the appointment, come to us, show what they owe and follow the rules.

[Rick Perkins, Conservative, South Shore—St. Margarets, NS]

That wasn't my question.

[Konrad von Finckenstein]

I hear you, but I'm trying to give you the context. You're asking me a question, and you're doing so on the basis of the fact that you think there has been a lot of misbehaviour and we're not investigating.

I am looking at—