House of Commons photoWon his last election, in 2004, with 65% of the vote.
Prime Minister April 4th, 2001
Mr. Speaker, Jonas Prince was chairman of Delta hotels when he signed an agreement with the Prime Minister in 1993. Mr. Prince operated at least nine Delta hotels in Cuba until he sold his interest in 1998.
My question is for the Minister of Industry, if he would pay attention. Has Mr. Prince or his companies ever received any direct or indirect funding from his department, from the Business Development Bank of Canada or from Export Development Corporation?
Prime Minister April 3rd, 2001
Mr. Speaker, if the Prime Minister does not know the answer maybe he can ask his caddy over there for the answer.
After getting the CIDA contract and buying the land from the Prime Minister, Transelec donated $10,000 to the Prime Minister's election campaign. To everyone's surprise, a year later Transelec's owner received a $1.2 million HRDC grant, a grant from an illegal trust fund to buy Placeteco, a company in receivership.
If the Prime Minister will not call a judicial inquiry into the mess at Grand-Mère, will he be calling one for this mess with Gauthier?
Prime Minister April 3rd, 2001
Mr. Speaker, in September 1996 the Prime Minister's friend, Claude Gauthier, purchased land worth more than half a million dollars from the Prime Minister's numbered company.
This was just three days after Gauthier's company received a $6.3 million CIDA contract, a contract for which he should not even have been allowed to bid. Is it not obvious that this was just a trade-off, a CIDA contract for taking the land next to the golf course off the Prime Minister's hands?
Supply April 3rd, 2001
Madam Speaker, I thank my colleague for the question. It is a very good one.
This is not a normal situation, as the Prime Minister would have us believe. It is far from it. The president of the Business Development Bank is indirectly an employee of parliament. BDC is a crown corporation, a government owned bank. The Prime Minister phoned the president of that bank and put pressure on him to give a loan to a friend who happens to own a hotel next to the Prime Minister's golf course.
If the hotel failed and he did not get the loan, the value of the golf course would obviously have diminished. This is far from a normal operation. I do not know of any members of the House who have that kind of clout, the opportunity to phone the president of the Business Development Bank and ask for those kinds of favours.
The president of the BDC, Mr. Beaudoin, did not like it either. It took two calls plus heavy lobbying at the Prime Minister's residence to make it happen. Even then the interest rates were put at 25% because he considered it a very high risk loan, and well he should have. Two and a half years after getting the loan no payments had been made. That is why the BDC president advised that there should be foreclosure. As soon as that happened the bank manager lost his job.
Supply April 3rd, 2001
Madam Speaker, I do know that the Prime Minister was never paid for the shares. Even though they were said to be sold on November 1, 1993, he never received payment. The Prime Minister therefore had a clear interest in the shares. Mr. Jonas Prince never paid for them during that period, whether he owned them or not. When the Prime Minister lobbied the president of the Business Development Bank in 1996 and 1997 he was clearly in a conflict of interest.
As to the blind trust issue, it is pretty clear that the Prime Minister should not meddle in a blind trust. He did not need to put his shares there. He did so voluntarily, which makes it all the worse that he did not deal with the issue properly. He violated the spirit of the blind trust.
Supply April 3rd, 2001
Madam Speaker, I will be splitting my time with the member for Calgary—Nose Hill. I am happy to take part in the debate.
The Canadian Alliance brought forward a motion to establish a judicial inquiry to determine whether the Prime Minister is in a conflict of interest. It is a serious and important issue for Canadians. They want to know what is happening and that is why we are calling for a judicial inquiry.
It is becoming more and more evident that the Prime Minister is in a conflict of interest on the Grand-Mère issue. Canadians should be concerned that the Prime Minister lobbied for grants and loans for a failing hotel beside a golf course in his riding in which he held a $300,000 interest.
However Canadians should be even more concerned that time after time the Prime Minister has directly contradicted himself on the facts. One of the latest examples was published by the Canadian Press on April 2, 2001. After denying there were links between the golf course and the hotel, the owner of the Auberge Grand-Mère said under oath on November 2, 2000:
Agreements, accounts and contracts were made between the Auberge and (the golf course's) clients. You can understand that this represents a major part of the (Auberge's) receipts.
Canadians are concerned. A Compass poll released March 30 showed that 63% of Canadians think the Prime Minister was wrong in lobbying, 60% of Canadians want an independent public inquiry, and 85% feel it is necessary to get to the bottom of the matter.
How did this develop? The Prime Minister himself set the standard in 1993 but he has not met his own standards. The following are quotations from the 1993 red book:
There is evidence today of considerable dissatisfaction with government and a steady erosion of confidence in the people and institutions of the public sector.
This erosion of confidence seems to have many causes: some have to do with the behaviour of certain elected politicians, others with an arrogant style of political leadership.
At the time the Liberals were talking about Mulroney, but I think it pertains even more to the present administration. It continued:
The people are irritated with governments that do not consult them, or that disregard their views, or that try to conduct key parts of the public business behind closed doors.
How did this happen? What is the history of this development? We must go back a little to understand it.
In 1986 the member for St. Maurice quit politics to build his private holdings. In May 1988, along with two business partners, his company J&AC Consultants Inc. bought the Grand-Mère golf course for $625,000.
In April 1993 the money losing Auberge Grand-Mère next to the golf course was sold to an old friend of the Prime Minister's, Yvon Duhaime. The deal was completed just before the Prime Minister was sworn into office.
The Prime Minister says he sold his one-quarter share in the Grand-Mère golf course on November 1, 1993, to a wealthy Toronto real estate developer, Jonas Prince, for $300,000 plus interest.
The sales agreement with Jonas Prince is dated November 1, 1993. It is a handwritten note scrawled on a blank piece of paper. It is not witnessed or notarized. It is without independent confirmation of date. We do not even know what province it was signed in or what law governs it, yet it was drafted by two corporate lawyers. It is quite a note and quite a contract.
However, in two letters to the National Post dated December 1998, Jonas Prince denied buying the share and said it was merely an option to purchase. He sent back the corporate records of the golf course unsigned, took no part in its management, paid $40,000 in compensation in 1997 and thought that was the end of the deal.
It was not. When the Prime Minister needed money he phoned his lawyer and found the debt was unpaid. He then phoned the ethics counsellor at home on a Saturday, January 27, 1996. It must have been pretty important for him to call on a Saturday. The ethics counsellor advised the Prime Minister he could sell the shares or declare publicly that he owned them.
The Prime Minister did neither for three years until a newspaper broke the story in January 1999. Instead he began lobbying for grants and loans for the Auberge Grand-Mère next to the golf club. He had a meeting with immigrant investors on February 28, 1996, made repeated phone calls to the Business Development Bank, and lobbied HRDC for job creation grants in 1996 and 1997.
Seven months after the Prime Minister learned he was still owed money for the shares, a wealthy friend of the Prime Minister's, Claude Gauthier, bought a piece of land from the Grand-Mère Golf Club for $525,000. That was in September 1996, days after Gauthier won a $6 million CIDA contract for which he was not even qualified to bid.
Gauthier's company, Transelec, then donated $10,000 to the Prime Minister's personal election campaign in 1997. The Prime Minister won that campaign, I might remind the House, by just 1,600 votes. During the campaign things were pretty hot and furious in Grand-Mère and Shawinigan.
Later in 1998 HRDC created an illegal trust fund to hold $1.2 million in grant money so that Mr. Gauthier could purchase a company in the throes of bankruptcy. He declared bankruptcy six months later anyway and started the company again with fewer employees.
A friend of the Prime Minister recently said the golf club was still in the Prime Minister's hands and that he was still a registered shareholder. Melissa Marcotte is quoted in the National Post on March 23, 2001, as saying that the minutes of the share registry book had not been signed since 1994. I guess the minutes have been corrected at Industry Canada now. I would like to see them but we do not have the opportunity.
Throughout all this the Prime Minister knew he was owed $300,000 for his shares. He had not been paid for his shares in the golf course. He knew that Jonas Prince thought he did not own the shares. He was kept abreast of the efforts to sell them by both the ethics counsellor and his lawyer Debbie Weinstein.
The Prime Minister's claims are simply not credible. Jonas Prince sold his hotel chain for $90 million. He could have paid for the Grand-Mère Golf Club shares out of pocket change. Why did he not? It is because he never believed he owned the shares. Six years went by and he never paid for the shares. He did not pay for them because he did not believe he owned them.
Since that time heavy pressure has been put on Mr. Prince and he has changed his tune. He obviously believed he did not own the shares. Otherwise he would have paid for them. Why would a successful businessman like Mr. Prince risk the wrath of the Prime Minister of Canada by not honouring what was supposed to be a bill of sale?
It does not make sense. It does not pass the smell test. In other words, as the old saying goes, there is something rotten in the state of Denmark. That describes the situation perfectly.
Let us move on. Let us talk about the blind trust issue which is very interesting as well. On March 1, 1994, the Prime Minister put all the business affairs of his holding company, J&AC Consultants Inc., in a blind trust.
The Prime Minister's declaration on the ethics counsellor's website says:
I declare that I hold a third of the shares of J&AC Consultants Inc., a private company managed by a third party who is not dependent on me and without a right of regard on my part.
However on January 27, 1996, the Prime Minister violated the blind trust and called his lawyer and the ethics counsellor regarding the sale of the shares. That is some blind trust. It is a little like the reason Sinclair Stevens had to leave the House, I would add.
If the Prime Minister had distanced himself the controversy may well have been over. If it was a blind trust, the obvious question for Canadians is how he knew the shares had come back to him. It is a pretty obvious question yet it has not been answered.
The ethics counsellor said the debt did not need to be declared because of a “deficient form” that did not require him to declare debts. However the Prime Minister voluntarily put his company into a blind trust. He was not ordered to do so. He voluntarily did so. He broke his own promise to have no right of regard.
On March 23, 1999, The Prime Minister stated in the House that he had voluntarily put his debt in a blind trust:
I put all my assets in the trust. It is a blind trust. I was not forced to give her the management. I did exactly that so I would not have to reply to that type of question.
The ethics counsellor confirmed that the Prime Minister had broken that trust.
Let us discuss the Business Development Bank loan. The Prime Minister phoned the president of the Business Development Bank twice and once lobbied him at 24 Sussex Drive. That needs to be explained and that is why we need a judicial inquiry.
The Prime Minister is simply not credible on the issue. Many questions need to answered. It is not normal to phone the president of the Business Development Bank. Members of parliament do not have such access. The Prime Minister did so and he put pressure on him. The net result was that the loan was given. When the loan was pulled two years later because no payments had been made, the president of the Business Development Bank was fired. What a strange coincidence.
Supply April 3rd, 2001
Mr. Speaker, I rise on a point of order. I was listening very carefully and I could not hear the answer of the member for Winnipeg—Transcona. I am interested. I think he should be allowed to give his answer so that members of the House can hear it.
Prime Minister March 28th, 2001
Mr. Speaker, the Prime Minister might note that unless he stops his ministers from shouting, the minister over here will never have a chance to respond to anything.
Both the Prime Minister and Jonas Prince are corporate lawyers. They know they are supposed to comply and abide by the law and have the shareholder registry reflect the real situation. They know that. Could the Prime Minister provide any record, any proof at all, that he requested his name be removed from the registry?
Prime Minister March 28th, 2001
Mr. Speaker, yesterday we asked the Minister of Industry about a breach of the Canada Business Corporations Act. He refused to answer the question.
I remind the House that as Minister of Industry he has the statutory responsibility for this act so I want him to answer a straight question today. Will the minister tell us whether the share registry of the Grand-Mère Golf Club complied with all applicable laws?
Standing Committee On Industry, Science And Technology March 27th, 2001
Mr. Speaker, I am happy to repeat the question. Why did the chair use her parliamentary office today to cover up for the Prime Minister?