OTTAWA – Justice Jeffrey Oliphant has found former prime minister Brian Mulroney breached federal ethics guidelines in his once-secret business dealings with German-Canadian lobbyist Karlheinz Schreiber.
"Upon reviewing the evidence of Mr. Mulroney’s conduct and applying the ethical rules and guidelines in force at the relevant times, I find that Mr. Mulroney contravened Section 7(b) of the 1985 Ethics Code, which provides that public office holders have an obligation to act in a manner that will bear the closest public scrutiny, an obligation that is not fully discharged by simply acting within the law," Oliphant said in a statement.
"In my view, Canadians are entitled to expect from those who govern, particularly the holders of high office, exemplary conduct in their professional and personal lives. Further, those who are making the transition from public life to private life must live up to the standards of conduct expected of them in order to preserve the integrity of government.
Oliphant said the former prime minister was guilty of inappropriate activity in at least two areas.
"I found that the business and financial dealings between Mr. Schreiber and Mr. Mulroney were inappropriate. I also found that Mr. Mulroney’s failure to disclose those business and financial dealings was inappropriate," Oliphant said in his report. "Simply put, Mr. Mulroney, in his business and financial dealings with Mr. Schreiber, failed to live up to the standard of conduct that he had himself adopted in the 1985 Ethics Code.
However, Oliphant rejected Schreiber’s claim that he and the former prime minister entered into a business agreement at Harrington Lake while Mulroney was prime minister
"Mr. Schreiber’s testimony was that, at Harrington Lake, they had an agreement "to work together in the future. Mr. Mulroney was adamant in his testimony that there was no agreement to work together in the future. Even if I accept Mr. Schreiber’s evidence on this point, the vagueness of the proposition and the lack of particularity and details do not support a finding that a formal agreement was reached while Mr. Mulroney was still prime minister.
"I find that, although Mr. Schreiber hoped to obtain Mr. Mulroney’s support with respect to the Bear Head Project after Mr. Mulroney left office, they neither discussed that issue nor reached any agreement about it on June 23, 1993, at Harrington Lake. I disbelieve Mr. Schreiber’s evidence that Mr. Mulroney told him he (Mr. Mulroney) could help with the Bear Head Project once Ms. (Kim) Campbell became the prime minister.
"Moreover, it is abundantly clear, on a close examination of Mr. Schreiber’s evidence when he was cross-examined . . . that he and Mr. Mulroney did not reach any agreement that day at Harrington Lake, while Mr. Mulroney was still the sitting prime minister of Canada – and I so find.
Oliphant further said he rejected Schreiber’s claim that Mulroney had agreed to lobby domestically for the Bear Head Project, but he also found no evidence of any service provided by Mulroney on the international stage as he had claimed.
"On the issue of what services Mr. Mulroney provided in return for the payments from Mr. Schreiber, I have grave concerns about the total absence of any independent evidence, whether documentary or otherwise, that might tend to support Mr. Mulroney’s testimony," Oliphant reported.
"Given this vacuum, I am not able to find that any services were ever provided by Mr. Mulroney for the monies paid to him by Mr. Schreiber pursuant to the retainer."
The report by the Manitoba judge, released Monday, is the climax of a $16-million public inquiry into the appropriateness of the former prime minister’s commercial relationship with Schreiber.
Prime Minister Stephen Harper, who ordered the inquiry, asked Oliphant to investigate the appropriateness of Mulroney’s dealings with Schreiber before and after he resigned as prime minister on June 25, 1993.
At the heart of the inquiry were three cash payments of at least $225,000 that Mulroney says he took from Schreiber in exchange for lobbying internationally on behalf of a German-designed, light-armoured vehicle that Schreiber wanted built in Canada for export. Mulroney acknowledged he got the first of three cash-stuffed envelopes at the end of August when he was still an MP.
Schreiber, who is serving an eight-year prison term in Germany for tax evasion, said he paid Mulroney $300,000 cash to lobby domestically for the plan, known as the Bear Head project.
Oliphant had no mandate to find criminal or civil wrongdoing. Nor did he have a mandate to revisit allegations of kickbacks that swirled around Schreiber, Mulroney and others about Air Canada’s $1.8-billion purchase of Airbus planes in 1988.
Mulroney has called accepting the cash payments a "serious error in judgment," but he has insisted he did nothing illegal and no ethics guidelines were violated.
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