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http://www.theglobeandmail.com/serv...Story/National/
SECRET TESTIMONY REVEALED
By TU THANH HA
Thursday, April 7, 2005 Updated at 2:18 PM EST
Globe and Mail Update
Montreal — A Montreal ad executive at the heart of the federal sponsorship scandal says Liberal organizers pressed him into secretly donating more than a million dollars to them through various covert methods that included envelopes full of cash, fake invoices and putting phony employees on his payroll.
The devastating testimony Jean Brault gave at the Gomery inquiry had been kept secret until now because of a publication ban so it wouldn't prejudice criminal proceedings against him.
Mr. Justice John Gomery partially lifted the blackout.
Mr. Brault also said he made disguised payments to provincial political parties, in contravention of Quebec law. He illicitly gave at least $100,000 to the Parti Québécois and $50,000 to Jean Charest's provincial Liberals.
Mr. Brault's testimony portrayed a broad pattern of deception that spanned years and involved several people, including senior party organizers, a brother and a friend of then prime minister Jean Chrétien and several past and current ministerial advisers.
"There is a lot of creativity in their demands," he said.
The inquiry has been checking whether the millions of dollars a handful of Quebec agencies received in contracts after the 1995 referendum were tied to benefits the Liberal Party of Canada received from those firms.
Mr. Brault gave the most candid answer yet to that question.
He said Benoît Corbeil, the executive director of the party's Quebec wing, once asked for a $400,000 donation and promised that he would get him a $3-million sponsorship contract. The commission Mr. Brault would earn on that contract was to compensate for the donation.
He said other disguised donations he made included half a million dollars in false billings to Jacques Corriveau, a confidant of Mr. Chrétien.
"When it comes to sponsorships, it's clear in my mind. If it wasn't for the investments of all types that we made towards the party, despite our abilities, our share of the pie would have been very small," he said.
While some of his allegations cannot be independently verified, many others were buttressed by scores of bogus invoices, cashed cheques, annotations in agenda books and other records the inquiry's forensic accountants dug up.
His testimony further cemented the notion that the program that Mr. Chrétien defended as an essential stratagem to counter the separatist threat has turned into a full-blown scandal threatening the survival of the Liberal governments in Ottawa and Quebec City.
While the scheme brought more business to his firm, Groupaction Marketing Inc., Mr. Brault also described darker moments.
He said Tony Mignacca, a friend of former public works minister Alfonso Gagliano, made a veiled threat that Groupaction would lose a major contract should Mr. Brault fail to rehire a Liberal lobbyist with whom he had a falling out.
As he recalled the incident, Mr. Brault got so upset he had to take a break from the witness stand.
When he came back, he testified about Mr. Gagliano's top organizer, Joseph Morselli, who wanted a large payment in return for the postponement of a bidding competition.
Mr. Brault said he offered $100,000, but Mr. Morselli said it would have to be in cash, otherwise he had to pay twice as much.
As Mr. Brault told of his increasing resentment at making secret gifts to the Liberals, Judge Gomery asked why he kept paying.
"We were left to understand that all contributions would be taken into consideration — and in one way or another would be compensated for," Mr. Brault explained.
The clandestine contributions were made on top of $166,000 in official donations that Mr. Brault gave to the Liberal party.
Making disguised donations is illegal under federal law, but prosecution would have to have taken place within 18 months.
The process was lucrative for Mr. Brault. From 1995 to 2001 the federal government granted his firm $112-million in advertising contracts and $60-million in sponsorship contracts. During that period, he and his wife paid themselves $5.7-million in salary, bonuses and dividends.
THE DOOR-OPENER
Mr. Brault said that initially the demands came from a trio of Liberal organizers: Alain Renaud, Mr. Corbeil and Mr. Corriveau.
Mr. Renaud was a lobbyist who had approached Mr. Brault, pledging that he would be able to use his connections to drum up business. In the agreement they signed, Mr. Renaud's numbered company is referred to as "The Specialists."
Mr. Brault would over the years pay him a total of $1.1-million in fees and expenses for his work. "He said, `I've got ins . . . I come from a tradition, we've been good Liberals for generations'. He said `I'll go see in Ottawa what we can do.'"
Mr. Renaud encouraged Mr. Brault to attend fundraisers. He introduced him to various Liberals. He said Mr. Renaud got him a meeting on Aug. 17, 1995 with Jean Carle, who was then director of operations in the Prime Minister's Office.
Mr. Renaud had told him that "we have to get ourselves known at the PMO."
They went to Ottawa and Mr. Brault said he outlined his firm's abilities while Mr. Renaud said "we're good Liberals. We work hard. We are competent. What's needed? We should have some business."
Mr. Brault said Mr. Carle reacted frostily at first, asking them in a terse way: "Did someone promised you something?"
Mr. Brault said he replied, "Listen, it's not easy what we're doing here." He reiterated that, at Mr. Renaud's advice, he was buying all kinds of fundraising events. "Is there some way to get business?"
Mr. Carle then told them to go see bureaucrats in charge of advertising. "They'll explain to you what you need to do."
They told him they had already done that but he said they should keep trying. Mr. Brault said Mr. Carle told him that "Doing business with the government, it's like a big highway. There's a place for everyone. Big trucks. Small trucks. Big cars. Small cars."
Eventually, Mr. Brault was introduced to Mr. Corriveau and Mr. Corbeil, then the party's executive director in Quebec.
Subsequent requests came either from Mr. Renaud, Mr. Corbeil or Mr. Corriveau, Mr. Brault said. "It cost a lot, meeting them."
Mr. Corriveau's reputation as a political fixer was well-known, Mr. Brault said.
He recalled an evening with fellow businessmen where, after a few after-dinner ports and brandies, he got advice from Jacques Olivier, a car dealer who had been a minor Trudeau-era cabinet minister.
"Stick close to Corriveau, it'll open doors for you," Mr. Brault said Mr. Olivier told him.
THE BOGUS EMPLOYEES
Mr. Brault said at least five Liberals were put on his payroll at the request of party organizers, though he would only describe one, Maria Lyne Chrétien, the prime minister's niece, as a person he would have needed to hire.
He said it began in the fall of 1993 when Daniel-Yves Durand, a Liberal organizer he had known through a client, introduced him to a party executive, Michel Fournier. Over lunch at the fancy bistro Buena Notte, they sought a $20,000 political donation.
Mr. Brault said he was reluctant. Mr. Durand was between jobs so "they came up with the idea I would help Mr. Durand financially, at $500 a week, while leaving him available for the party."
The arrangement lasted two to three months, Mr. Brault said.
In April, 1996, as Mr. Renaud's lobbying had begun making Mr. Brault known as a Liberal-friendly entrepreneur, Mr. Corriveau asked him to hire for a year "someone valued by the party."
This was Serge Gosselin, who briefly worked for cabinet minister Stéphane Dion before becoming chief of staff to then Montreal mayor Pierre Bourque.
Mr. Brault agreed because "we started to sense what was the miracle recipe to get lucky . . . it was to lend a good ear to some requests that the party made to us."
He paid Mr. Gosselin $7,000 a month — $84,000 in total — though he wasn't seen around his firm's offices. Mr. Gosselin spent that time working on a biography of Mr. Gagliano, the inquiry heard.
The same scenario unfolded again in July, 1999, when Mr. Corbeil asked Mr. Brault to hire a Liberal organizer, John Welch, now the chief of staff of Heritage Minister Liza Frulla.
Mr. Welch got paid $8,000 a month. For a year, he kept a small office at Groupaction, where "he was very active on the phone and I understood he was doing work of some type for the party," Mr. Brault said.
He said he was also told by Mr. Corriveau to hire Maria Lyne Chrétien. "He didn't suggest, he asked." He said however that she fit the profile of a person he would have needed at the time in his multimedia division. She was paid $34,789.
THE FAKE BILLINGS
At Mr. Corriveau's request, Mr. Brault said, he donated between $5,000 and $12,000 in 1997, an election year. It was done either through company cheques or through employees.
Employees were reimbursed with bonuses, which were adjusted to compensate for their resulting bigger income taxes. "All the people close to Jean Brault who donated . . . did so at my request and got paid back 100 per cent."
Also, between April and June of 1997, Groupaction set up a series of transactions between its auditors and one of his associates, Richard Boudreault.
Officially Mr. Boudreault was on unpaid leave from Groupaction to help the Liberals during the election but the transactions concealed the fact that Mr. Brault paid him $24,300 for his work.
Also, Mr. Brault said, he used other invoices from Mr. Boudreault to hide payments totalling $14,790 to three Liberal election workers, Monique Thomas, Claire Brouillet and Carolina Gallo.
Ms. Brouillet, a one-time Liberal candidate, has worked for cabinet minister Lucienne Robillard. She also is the wife of party organizer Daniel Dezainde, now the press secretary of Jacques Saada, the minister for Canada Economic Development.
Ms. Gallo is a member of the Liberals' organization committee, where she worked alongside organizers Jacques Roy and Guy Bisson.
The names of Mr. Roy and Mr. Bisson came up at the inquiry before, when former Groupaction employee Bernard Thiboutot testified that he gave them respectively $6,400 and $11,556 as part of nearly $77,512 in hidden donations that initially came from Mr. Brault.
The disguised payments continued in 1998 when Groupaction paid $22,000 for what was invoiced as a corporate video.
Shot by Caméo, the production house of Thalie Tremblay, daughter of long-time Gagliano supporter Michèle Tremblay, the video was in fact made for the benefit of the Liberal Party, but Mr. Brault footed the bill, the inquiry heard.
The inquiry then heard that in November, 1998, Mr. Brault paid Gaby Chrétien, the brother of the prime minister, $4,000 to help a Liberal MP south of Montreal. This was disguised by having Gaby Chrétien send a bill marked "professional honoraria."
One major secret donation involved Mr. Renaud.
In February, 1998, Mr. Renaud billed Groupaction $63,500 for various professional services but no work had been done in fact, Mr. Brault said.
Mr. Renaud then gave $63,858 to the Liberal Party of Canada that year, making him the seventh biggest donor, ahead of some chartered banks.
"I did my duty for my party," Mr. Renaud told the Globe and Mail when he was asked about that donation.
Mr. Brault told the inquiry that he paid Mr. Renaud's bogus invoices because "I wanted the messenger to deliver the message."
But all those false billings pale next to what he arranged with Mr. Corriveau.
From 1996 to 2000, Groupaction paid Mr. Corriveau's firm, Pluri Design, a total of $495,479, documents filed at the inquiry show.
Mr. Brault said no work was done to justify the invoices.
MORE REQUESTS
Gradually, the requests got more demanding. One time in 1997 or 1998, he said, he had been asked to donate $100,000 so he had to bargain it down to $50,000, but in cash.
Then, either in April or May, 2001, Mr. Brault met Mr. Morselli, a long-time organizer for Mr. Gagliano and the vice-president for financing of the party's Quebec wing.
Mr. Brault was invited for lunch at Ristorante Frank, a big eatery in Montreal's Little Italy where Mr. Morselli kept a regular table.
He said Mr. Morselli told him: "Forget Corriveau. From now on, for the fundraising, it'll be me."
Meanwhile, Mr. Brault and Mr. Renaud had parted ways over a financial dispute.
Mr. Brault said the two tried to reconcile at a supper in May or June, 2001, at the swank restaurant Mediterraneo. Mr. Renaud's cellphone rang around 10:30 p.m.
Mr. Brault said Mr. Renaud spoke briefly before handing him the phone and saying "Jean, there's someone who wants to talk to you."
It was Mr. Mignacca, an old friend of Mr. Gagliano.
Mr. Brault said Mr. Mignacca told him he had just dined with "the choo-choo man," which he understood to mean one of Via Rail's top bosses, president Marc LeFrançois or chairman Jean Pelletier, both Chrétien loyalists.
He said Mr. Mignacca then invited himself to join them for an post-supper glass of grappa and started singing Mr. Renaud's praises — then added that if Mr. Renaud wasn't rehired, "he hinted that our Via account was threatened."
Mr. Brault said he was outraged, especially since he was recovering at the time from heart problems.
THE CASH PAYMENTS
In August, 2001, at another lunch at Ristorante Frank, Mr. Brault said Mr. Morselli asked him to help Buryl Wiseman, a party worker who had run into trouble with Quebec wing president Françoise Patry.
"Keep him on your pay for a year, at $10,000 a month, we need him," Mr. Brault said Mr. Morselli told him.
At the time, Mr. Brault was considering selling Groupaction so he didn't want a bogus employee. He said he offered instead to pay $5,000 each month in cash.
The next time at the restaurant, Mr. Brault said he put an envelope of cash on the table and left for the bathroom when Mr. Wiseman showed up.
"When I came back, the two were seated, the money was gone. The conversation went as if nothing had happened."
In all, he paid Mr. Wiseman up to $25,000, Mr. Brault said.
He said that they told him Mr. Wiseman had connections in the Jewish community but that he never delivered on his promises that he would find him more business.
In September, 2001, Mr. Brault needed something from Mr. Morselli.
"You're asking a lot of me. I do what I can. You said `If I can help, I'll do it'," he said he reminded Mr. Morselli. "I challenged him."
He told Mr. Morselli he needed to delay the bidding for a contract with the Justice Department.
He said Mr. Morselli called a few days later and asked him to his office, in an east-end industrial park. As he went in, he saw Mr. Mignacca leaving.
He said Mr. Morselli asked for $100,000 in cash. "It's $100,000 and your problem is solved," Mr. Brault said he was told.
He said he was dubious so he offered to pay in two instalments of $50,000, the second time in April, 2002.
The initial $50,000 was paid in two parts in late 2001, the second part on Dec. 20, when Mr. Brault showed up at Buffet Rizz where a spaghetti fundraiser for Mr. Gagliano was taking place.
He hadn't bought a ticket but he told people at the registration table his name and asked them to verify with their high-ups that he didn't need to pay for his meal. They let him in. He said he handed $25,000 to Mr. Morselli.
The final payments never took place. In the spring of 2002, the sponsorship scandal broke out. The Globe and Mail reported about irregularities in three of the contracts Groupaction handled.
Mr. Brault's firm came under scrutiny by the Auditor-General, then the RCMP.
He said Mr. Morselli advised him to keep a low profile, then, much to Mr. Brault's annoyance, asked for the remaining $50,000. Mr. Brault refused to pay.
By that time, Mr. Brault was no longer keen on helping the Liberals.
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