Saturday, November 17, 2007

Controverys dogs Karlheinz-Schreiber

This article contains a lot of interesting background on Karlheinz-Schreiber including material about his earlier doings in Alberta. Listening to an interview with him on TV I was struck by his seeming high spirits and his sense of humour. Given that he is facing trial and possibly long imprisonment in Germany and is in jail here I found his high spirits a bit surprising! Not every senior citizen would look so cheerfully to life in prison and endless court battles. Maybe he can like Mulroney write his memoirs but while he is in jail!

Controversy dogs feisty German
'My friend Karlheinz'

Allison Hanes
National Post

Saturday, November 17, 2007

When Germany laid fraud and bribery charges against Karlheinz Schreiber in 2000 following a political financing scandal in his homeland, his response was strangely jubilant.

"I love it!" he exclaimed to the National Post at the time. "Now my enemies have to prove they have evidence."

Seven years later, his gleeful bring-it-on attitude is still on display -- even as he languishes in a Toronto jail, has lost another round in his extradition fight and finds himself at the epicentre of one of Canada's longest lingering political controversies, which this week came back to haunt the present-day Conservative government.

In an interview this week from the Toronto West Detention Centre, Mr. Schreiber was already relishing the prospect of testifying about his dealings with former prime minister Brian Mulroney, seemingly smug in the knowledge he will be the star witness.

"You will understand that I want to leave quite a few important things for the inquiry," he said, (although he has since announced these divulgences are contingent on his remaining in Canada).

It is just one of the many conundrums of an enigma who has become a household name, a spy who thrives in the spotlight and a keeper of secrets who never shuts up.

Mr. Schreiber was born to a Bavarian peasant family in 1934 and got his start hawking oriental carpets, before embarking on to a career as a middleman brokering everything from tanks to pasta makers.

Throughout, he has cultivated close connections to the political elite in both Canada and Germany -- from onetime Bavarian premier Franz Josef Strauss and former German chancellor Helmut Kohl to Mr. Mulroney and Cabinet ministers both Conservative and Liberal.

In the 1970s, he emigrated from Germany to Alberta, where he started a road-painting business and formed his first ties with the province's Conservatives, whom he named to his companies' boards.

It was in Alberta that he became embroiled in his first political imbroglio, over his purchase of land outside Edmonton that suddenly swelled in value amid plans to expand the city. A judicial inquiry later dismissed allegations he had received insider information from his Tory pals.

Although Alberta's then-premier Peter Lougheed eventually forbade his caucus from contacting him, Mr. Schreiber went on to nurture relationships with Canadian power-brokers -- loyalties that have endured despite questions over murky financial dealings involving shell companies in Liechtenstein, investigations into allegations of kickbacks and his link to major government scandals in two countries.

When he was arrested on a warrant from Germany in 2000, former Liberal justice minister Marc Lalonde and former Conservative solicitor general Elmer MacKay (whose son Peter MacKay is the present-day Defence Minister) posted $100,000 in bail money for their "friend in need."

In the 1980s, Mr. Schreiber was put on the payroll of the Bundesnachrichtendienst, the West German intelligence service, which recruited well-connected international businessmen to report back on their dealings with the world's political and financial elite.

He worked for Thyssen AG selling tanks to Saudi Arabia and trying to set up an armoured vehicle factory in Nova Scotia.

While his role in the downfall of former chancellor Kohl earned him notoriety in Germany, it is his soured association with Mr. Mulroney that is the source of his infamy in Canada. According to Mr. Schreiber, their dealings began in the late '70s or early '80s -- long before their names were linked to the so-called Airbus affair.

In 1983, Mr. Schreiber became a donor to Mr. Mulroney's successful leadership campaign.

Their relationship appears to have mixed business with pleasure. Mr. Schreiber says Mr. Mulroney sent him a telegram congratulating him on receiving his Canadian citizenship in February, 1982.

He also has a signed circa 1993 photograph of Mr. Mulroney bearing the inscription, "For my friend Karlheinz, with gratitude and best personal regards."

Mr. Schreiber also received birthday wishes from Brian and Mila Mulroney in 1994. "We look forward to seeing you and Barbel," states the fax signed "Brian."

The falling out seems to have originated when Mr. Schreiber revealed to CBC's the fifth estate that he had made three cash payments totalling $300,000 to the former prime minister at hotels in Quebec and New York City between 1993 and 1994.

One of Mr. Mulroney's spokesman called Mr. Schreiber a "f--king liar," which seems to have hurt his feelings.

Mr. Schreiber this year moved to belatedly recoup that money from Mr. Mulroney in a lawsuit that charges Mr. Mulroney did nothing to earn it. In an affidavit, he now contends their cash deal was struck three days before Mr. Mulroney stepped down as prime minister, during a meeting at his official summer residence, Harrington Lake.

But in a series of "Dear Brian" letters now filed in court, Mr. Schreiber attempted to reach out to Mr. Mulroney for help with his extradition case and perhaps even to rekindle a friendship.

"It is far too long since we had lunch together," he stated in a letter dated July 20, 2006, apologizing for the revelations to CBC. "I think it is wrong not to speak to each other ... I have always been your friend even though I was irritated for some time."

Despite all that has happened, Mr. Schreiber seems wounded that Mr. Mulroney did not mention him in his recently released Memoirs.

"This is the very magic thing, that people ... who [were] so close to him and raised an enormous amount of money for him and fought for him are not in his book," he said, naming two individuals he thought deserved to be there. "And the third one is Mr. Schreiber. So this is pretty funny."

© National Post 2007

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