No charges to be laid in building of Winnipeg Police Service headquarters, Canada Post plant

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Winnipeg mayor Brian Bowman responds to reporters' questions about why the province has said no to calling a public inquiry over alleged fraud, forgery and money laundering relating to the building of the Winnipeg Police Service headquarters and a Canada Post processing plant. – Dec 13, 2019

Manitoba Justice says there is not enough evidence to charge anyone for serious allegations including fraud, forgery and money laundering relating to the building of the Winnipeg Police Service headquarters and a Canada Post processing plant.

Caspian Construction was hired by the city to build the new Winnipeg Police Headquarters and the Canada Post mail processing plant at 1870 Wellington Ave. The Commercial Crimes Section of the RCMP started their extensive investigation into the company in October of 2014.

“Based on all available evidence, MPS is not authorizing any criminal charges based on the findings of the investigation,” said the Manitoba Prosecution Service in a statement sent to media Friday.

READ MORE: City suing builders behind Winnipeg Police headquarters

Now that charges are not forthcoming, mayor Brian Bowman told Global News that he would like to move forward with a public inquiry. The city of Winnipeg is currently suing Caspian Construction, alleging corner-cutting and deficiencies in the WPS HQ building. The city’s claims have not been proven in court.

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No public inquiry: Province

At the press conference Bowman learned the province would not be calling a public inquiry, prompting him to let out a laugh of disbelief.

“I can appreciate that politically there may be some sensitivities having some of the players involved providing evidence under oath in a public inquiry,” said Bowman.

“They might be good public policy, but they’re not good politics, and that doesn’t mean that we shouldn’t do what’s right. And so, we’ll continue to call on the province to do a public inquiry.”

Justice Minister Cliff Cullen said the police review was “comprehensive” and that was enough for the province.

“We are focused on moving ahead,” he said, adding they are putting together a new framework to make these kinds of transactions more transparent in the future.

But Bowman said that wasn’t good enough for him.

“What new information have we learned as a result of the RCMP investigation? I’ve seen a two-page release. That doesn’t answer questions,” said Bowman.

“That doesn’t provide insights for policy makers to take steps to make sure that we don’t lose tens of millions of dollars, of taxpayer dollars on something like this happening again.”

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Bowman called out the province for refusing to do an inquiry, saying “we serve the same taxpayer” and taxpayers deserve answers.

Tens of millions

In December 2014, RCMP raided a Caspian Construction head office on McGillivray Boulevard. During that search, 46 boxes and four filing cabinets of documents were seized. RCMP said the investigation resulted in the review of more than six terabytes of data, 200,000 emails, interviews with 130 witnesses, and 15 search warrants.

“Those results consisted of 347 gigabytes of evidence including over 1,300 electronic folders and over 36,000 electronic files,” said MPS Friday.

Global News tried to reach Caspian Construction owner Armik Babakhanians Friday morning, leaving a message with the person who answered the phone.

Court documents acquired in February 2016 alleged Caspian Construction manipulated documents in order to inflate payments.

Police HQ costs ballooned over the years, starting from a $135 million project and ended up a $214 million project — so far.

MPS said they reviewed the evidence to see if charges could be laid.

READ MORE: RCMP investigation into Winnipeg police HQ, Canada Post plant nearing conclusion

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“Several prosecutors were consulted, based on their knowledge and experience related to this type of investigation and related legal disciplines.  The review … continued throughout most of 2019.”

Charges were considered by MPS including breach of trust, fraud exceeding $5,000, forgery of documents, uttering forged documents, keeping false books or documents, and money laundering.

“In all cases, two criteria must be met for charges to be laid,” said MPS.

“First, there must be sufficient evidence to support a reasonable likelihood of conviction.  The second consideration is whether charges are in the public interest, but this can only be considered if the first standard is met.”

In this case, there wasn’t enough evidence, MPS added.

A spokesperson for the Manitoba RCMP said now that the investigation has concluded, they “will not be providing any further comment.”

‘The cloud has lifted’

The events surrounding the awarding of the contract were during former mayor Sam Katz’s watch, and he, along with former CAO Phil Sheegl were implicated in the investigation.

Local lawyer Robert Tapper represented Katz during the investigation and said while he is happy for his client, he is still frustrated.

Vile words, frankly, are escaping me to describe the level of frustration and unhappiness that I have,” said Tapper. “I have happiness for Sam and for Phil that it’s over and that the cloud has lifted. But the cloud was there for five years.

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Tapper called the entire investigation into Katz and Sheegl’s involvement “stupidity.”

“Anybody who looked at the circumstances … was [it] appropriate for the mayor to get involved in that transaction? I abundantly said and quickly said, ‘No, it wasn’t.’ But was it criminal? Give me a break. It wasn’t even remotely close to criminal.”

— with files from Brittany Greenslade and Erik Pindera

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