Showing posts with label RCMP pension scandal. Show all posts
Showing posts with label RCMP pension scandal. Show all posts

Sunday, June 3, 2007

RCMP pension scandal

I heard part of the questioning of Frizzell and Frizell's testimony as well as that of Macaulay on CPAC this morning. It was quite interesting. This portion copied from another blog is just the tip of the iceberg. Dominic Crupi signed agreement beyond his authority multiple times and it took ages for anyone to stop him. While money was taken from pension funds minutes of the board meeting were actually altered at one point. There were large sums paid to Morneau Sobeco during the changeover. Why there was never ever tendering is left unexplained. The whole affair stinks and as usual it seems that a lot of bigwigs were not helpful to Frizzell.

The questioning focused on Staff Sargeant Mike Frizzell and Chief Superintendent Fraser Macaulay. NDP committee member David Christopherson asks some very pertinent questions during the May 29 meeting:

Mr. David Christopherson: Thank you very much, Chair.

I want to come back to this business of Morneau Sobeco. I'm having a lot of trouble understanding why NCPC would put themselves through such a wringer, questionable legal activities. It's one thing to want to go with something that's convenient, we all want to have our jobs every day as convenient as possible, and if going here is easier than going there, well, what does it take to get us there. I think everybody sort of lives by that.

But once that starts to become problematic, there's trade-offs. We're talking about the RCMP. You start getting into legal matters. It's becoming a huge issue. It's ultimately led to all this. I'm having trouble understanding why that wouldn't be looked into more. That is at the heart of this. Had there not been an effort by NCPC to insist that it be Morneau Sobeco exclusively and without having to go to a public tender, we wouldn't be here.

I'm still not satisfied I'm hearing adequate motivation. Why? Why were they willing to go so far, so persistently, just to make life easier. It doesn't sound like it. The savings of going with this process as opposed to the grief it was causing them to do it, to me, makes it a negative trade-off. Help me understand.

Why were they willing to go so far, so persistently?

The only reasonable answer is that for the people who went to this effort, the effort was worth it. Worth it how?

S/Sgt Mike Frizzell: Okay. First off, I don't understand either. There's a number of theories. You know you're an inch into the room, then you're two inches, and by the time you stop and look back you're halfway across the room.

It was a pretty good deal they had going, Great West Life was going to be administrator, nobody was going to ask any questions. Mr. Crupi had already committed to that insurance outsourcing happening. He was going to bring in both insurance and pension outsourcing. When some hiccups came in along the way, they found ways around it.

How this happened in our organization is beyond me. I've asked that question very many times. I have a very hard time believing that Mr. Crupi would have been so bold as to do all that on his own.

Dominic Crupi was former director of the RCMP's national compensation policy centre. According to earlier testimony, Crupi went to extraordinary lengths to make sure that even when he could no longer personally tender contracts to favoured companies, he could still make sure that the contracts went where he intended them to go:

[RCMP chief financial officer Paul Gauvin] pointed the finger, in particular, at Dominic Crupi, a senior civilian executive with the force who resigned following an internal audit into his actions in 2004.

Crupi's personal authority to sign contracts had already been removed after an earlier investigation, said Gauvin. But he then made an end-run around RCMP rules by going to Consulting and Audit Canada, a federal agency that arranges outside contracts for the government.

"He found somebody there, in terms of collusion, that worked with him," said Gauvin. "A lot of contracts were given out . . . that were not properly tendered and went directly to certain individuals."

That somebody was allegedly Frank Brazeau, a CAC bureaucrat and cousin to former Liberal MP David Smith. A KPMG audit further revealed that at least two of Crupi's contracts went to Brazeau, and from there to Smith's personal company Abotech, and from there to Morneau Sobeco.

But the allegations are that even more effort was taken to make everything seem legitimate:

S/Sgt Mike Frizzell: The final draft of that business case appears to have been done on March 15 of 2002, and it contained an evaluation grid that would make it appear that a proper bid evaluation took place. What this evaluation grid showed was a bid from Great-West Life and a bid from Morneau Sobeco versus keeping it internal. It showed the costings, and son of a gun, Morneau Sobeco won.

When we interviewed the people who were supposed to have been part of that bid, the evaluation committee, they told us that no such process ever took place. This was merely a paper exercise to add legitimacy to the process.

Again, David Christopherson's question looms large. If you are going to go to the effort of faking the bidding process, why not just do it for real? Why all the skullduggery that has led to this miserable situation today?

The obvious reason is that someone was profiting from the doctored process, and so was motivated to make the effort. We don't know who profited, though, because we haven't looked.

Yet...

Mr. David Christopherson: Are you satisfied that there's no question or no need to investigate whether or not there was any questionable activities, and I'm talking dollars now? Are you satisfied that that is not here?

S/Sgt Mike Frizzell: Not at all, but—

Mr. David Christopherson: I know you're not making that accusation, but you can't remove that either, at this stage.

S/Sgt Mike Frizzell: No, the horse is out of the barn. To go back now—

Mr. David Christopherson: And costs went up, too. It was like double the cost. So we are talking some extra money here. It does beg the question, at least the question, was somebody benefiting aside from making ease of worklife, as a result of getting this deal. You can't tell me that's not—

S/Sgt Mike Frizzell: We never actually got warrants on bank accounts or anything like that to be able to tell you that.

Mr. David Christopherson: In both your minds, is this an unresolved area that still could use some further light being shed?

S/Sgt Mike Frizzell: At the time I wanted to investigate that.

C/Supt Fraser Macaulay: Absolutely.

Mr. David Christopherson: Does it remain a concern, though, to get this whole picture?

C/Supt Fraser Macaulay: Yes. One of our issues is that somebody review the criminal investigation to determine whether it should be reopened. That's one of the things we would like to see done.

I think Macaulay is right. Christopherson captures the mood exactly:

Mr. David Christopherson: There hasn't been a meeting yet where we haven't had more questions coming out of the meeting than we had going in.

What are those questions now?

What was the motivation behind all this?
Where did all the added expenses go?
Did anyone profit personally from this?
If so, what did they in turn do with the "extra money" refered to by Christopherson?
And the real question that matters -- if there was money flowing between the major players in this scandal, was there an attempt to use some of that money to build a protective wall around the RCMP by influencing any effort to investigate what was going on in the pension office?

Saturday, April 21, 2007

Notes on Zaccardelli testimony

The rest of the article is here. Zaccardelli does not seem to have improved his skills at testifying after being coached and also resigning. You can't teach an old commissioner new tricks.

Zaccardelli show another blow to the public service
Susan Riley, CanWest News Service
Published: Thursday, April 19, 2007
Follow the rules. Keep notes. Trust no one. Good advice for any ambitious public servant -- especially someone contemplating a head-office career in the RCMP.

This week's electrifying testimony from former commissioner Giuliano Zaccardelli, his ex-underlings and some ardent critics was more than top-notch drama.

It was a textbook model of how not to manage, a nightmarish example of Bad Boss Syndrome, a vivid illustration of an office atmosphere so volatile it exploded in full public view, splattering the reputation of a venerable institution.


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Font: ****The question of whether the mishandling of the RCMP pension fund -- using it to hire relatives, pay for executive golf games, underwrite contracts of dubious merit -- amounts to administrative carelessness or criminal pilfering is one issue. That should be determined in due course.

What a Commons committee heard, in the meantime, was an account of butt-covering, blame-shifting and death by e-mail in the wake of the embarrassing revelations. All seasoned bureaucrats will recognize the phenomenon.

The RCMP is a separate agency, but is subject to most of the same rules that govern all public servants. In theory. In reality, under Zaccardelli's rule, a whistle-blower was sent to another department to contemplate his sins -- oh, and to enhance his resume -- when he dared question the pension matter. (Zaccardelli's insistence that he never used transfers to punish people drew derisive laughter from Mounties in the audience.)

Nor were two senior managers at the centre of the scandal fired -- or immediately removed, as Zaccardelli suggested. They were put on administrative leave, or sick leave, until they were pensioned off.

Anyone who followed the Maher Arar inquiry will recognize this approach: Miscreant Mounties promoted, or protected, rather than punished. (We still don't know who decided to launch an income-trust probe in the middle of an election campaign, by the way.)

What is obvious is that many rank-and-file officers had no confidence in Zaccardelli -- understandably. His testimony on whether he cancelled a criminal probe into the pension affair was contradictory: He never cancelled an investigation because he never ordered one, he said.

"A lie," said the man sitting beside him, retired Staff Sgt. Ron Lewis, who insists he had Zaccardelli's permission to start a criminal inquiry. Another lie from the chief, he charged, and a lie under oath.

It made for riveting television -- someone is lying, concluded witnesses -- but as a recruiting tool for the public service, it wasn't helpful.

In fact, this fiasco is only the latest in a series of petty, colourful sideshows -- the billion-dollar boondoggle, Gomery, the Dingwall affair -- that have besmirched the reputation of public servants and politicians alike

In his latest report, Privy Council clerk Kevin Lynch frets that repeated scandals -- and the "web of rules" they have spawned -- threatens the functioning of government.

"A public culture focused heavily on wrongdoing and individual accountability," Lynch writes, risks creating "an environment in which public servants are more concerned with not being accused of doing the wrong thing, than with doing the right thing."

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Tuesday, April 17, 2007

Zaccardelli: Perjury the Sequel

Jeff Sallot usually has well written interesting articles. I like the bit about the laughter when Zaccardelli claims -no doubt with a straight face-- that the RCMP does not use transfers as punishment. Well no doubt some are not punishments!


Zaccardelli admits cancelling criminal probe of pension fund
JEFF SALLOT

From Tuesday's Globe and Mail

OTTAWA — Former RCMP commissioner Giuliano Zaccardelli admitted yesterday that he "cancelled" a criminal investigation into irregularities in the administration of the Mountie pension fund in 2003.

"When I heard that somebody was trying to have a criminal investigation, it was inappropriate at that time and that's why I cancelled it," Mr. Zaccardelli told reporters after a heated session of the House public accounts committee in which three witnesses contradicted various aspects of the former commissioner's testimony.

At one point during the hearing, former staff-sergeant Ron Lewis, the Mountie who initiated the criminal investigation, turned to Mr. Zaccardelli and said: "He's telling lies. I'm sick of him, and he's doing it under oath."

The two men were seated next to each other at the committee's witness table. They gave contradictory versions of a meeting they had in the commissioner's office in the spring of 2003 to discuss the pension affair.

Mr. Lewis, who is now retired, said he told Mr. Zaccardelli that there were problems with the pension fund that needed investigation.

Mr. Lewis quoted Mr. Zaccardelli as saying to him that he should take his complaints to the commanding officer of the Ottawa-area division of the RCMP and "get a criminal investigation going."

Mr. Zaccardelli said he did not ask that an investigation be commenced. "I can't speak for his [Mr. Lewis's] misunderstanding."

Mr. Zaccardelli said he thought an internal audit was all that was needed at that time.

Committee members looked stunned. "This is not nuance. One of them is lying," New Democrat David Christopherson said.

The committee adopted Mr. Christopherson's motion calling on the minority Conservative government to convene a full-scale judicial commission of inquiry to sort out the contradictions.

Conservative MPs said they might support the call for an inquiry, but not yet. The Tories first want to see the report of a special investigator, lawyer David Brown, who is expected to present his findings in June.

Mr. Zaccardelli said at several points that he did not think the criminal investigation was appropriate. He was not asked by MPs specifically why the internal audit and the criminal investigation could not run on parallel tracks. But responding to shouted questions from reporters as he left the Centre Block on Parliament Hill, Mr. Zaccardelli said he exercised his responsibilities as commissioner and "cancelled" the criminal investigation.

Auditor-General Sheila Fraser reported last November that the RCMP improperly charged at least $3.4-million to the pension fund, but later paid it back. She also said an estimated $1.3-million was charged to the pension and insurance plans "to pay for commissions or products that provided little or no value, and for excessive payments to employees' friends and family members hired as temporary staff. The pension plan has been reimbursed or credited $270,280 of those unnecessary or wasteful expenditures."

Her report refers to the RCMP cancelling the criminal investigation two days after it started -- when an internal audit was begun instead. Her report, however, did not identify Mr. Zaccardelli.

Another Mountie witness, Chief Superintendent Fraser Macaulay, and Mr. Zaccardelli gave contradictory versions of events about how the force was dealing with the pension affair in the summer of 2004.

Mr. Zaccardelli said the chief superintendent told him he had known about problems with the pension fund for about 1½ years, but never came forward because he feared disciplinary action. Mr. Zaccardelli said he thought the chief superintendent had shown poor judgment and could benefit from a two-year transfer to the Department of National Defence. Mr. Zaccardelli denied this transfer was in any way a punishment.

The RCMP doesn't use transfers as a way to punish people, Mr. Zaccardelli said. This remark provoked derisive laughter from several rank-and-file Mounties sitting in the audience.

When it was his turn, Chief Supt. Macaulay testified he never told Mr. Zaccardelli he had known about problems with the pension fund for 1½ years.

Moreover, he viewed his transfer to Defence as punishment. "I was removed because I came forward. Period."

The way he was treated, the chief superintendent said, "was a very clear message to the employees. You don't put your hand up."

In other testimony, Mr. Zaccardelli said that when he eventually got the internal audit report, he acted "quickly and decisively to remove" two civilian administrators who were, in his view, responsible for nepotism and other problems with the fund.

These two administrators, Jim Ewanovich and Dominic Crupi, had a slightly different version. Both denied that they had been forced out under any cloud of suspicion. In fact, Mr. Crupi has found postretirement employment with another federal agency, the top-secret Communications Security Establishment, a position that needs a clearance for security and reliability.

Mr. Zaccardelli resigned as commissioner last December after giving contradictory testimony to another House committee about what he knew and when in the Maher Arar case.

Sunday, April 1, 2007

A judicial inquiry in RCMP pension scandal?

Given the time frame for these inquiries the pensioners may have passed on before the issue is settled. Maybe Ray Romanow could do an investigation. He is just to run for board member of Torstar with the recommendation of Iacobucci.


Day not ruling out judicial inquiry
JEFF SALLOT

OTTAWA -- A full judicial inquiry into the RCMP pension scandal could take years, yet in the end the government might be forced to go that route, Public Safety Minister Stockwell Day acknowledged yesterday under pressure from the political opposition.

Mr. Day reiterated his preference for what he describes as a relatively quick and informal investigation by a government appointee, a process that he believes could be wrapped up in 12 weeks.

But Mr. Day told the House the minority Conservative government has not ruled out a formal inquiry down the road. "We have not said an absolute no."

As Parliament broke yesterday for a two-week break, the government had still not named someone to chair the quick inquiry, saying it takes time for qualified people to clear their calendar of other commitments before they can accept such an appointment.


When asked if the investigator might be a retired judge, Mr. Day laughed and said "there is no shortage."

The Conservatives named two former Supreme Court of Canada judges to head commissions of inquiry last year. John Major is investigating the Air-India bombing and Frank Iacobucci is examining the cases of three Canadian Muslim men who were detained and tortured in the Middle East. Both these judicial inquiries will be examining RCMP conduct as part of their mandates.

Before heading to their ridings last night, government and opposition MPs used the RCMP pension issue as fresh fodder to go at each other in the House.

Liberal MP Lucienne Robillard said the fact the Conservatives don't want a full judicial inquiry is evidence they are part of an ongoing "cover-up." She noted that the government has known about the pension-fund scandal since a report by the Auditor-General in November, but did nothing until damning testimony by senior Mounties at the Commons public accounts committee Wednesday.

Government House Leader Peter Van Loan shot back that if there was any cover-up it was by the previous Liberal government. The alleged nepotism in the administration of the RCMP pension fund and misappropriation of money took place when the Liberals were in power.

NDP justice critic Joe Comartin said the government owes rank-and-file Mounties whose pension money was at stake a full commission under the Inquiries Act, which could force reluctant witnesses to testify under immunity. Mr. Day said the RCMP's interim commissioner, Bev Busson, can make sure all serving Mounties co-operate with the independent investigator.