Senate scandal: The latest on Wright, Duffy and the PMO

Former chief of staff Wright denies any wrongdoing

OTTAWA – The prime minister’s chief of staff went to Stephen Harper for approval of a secret plan that would have seen the Conservative party repay Mike Duffy’s contested expenses and whitewash a Senate report, new RCMP documents suggest.

When the party balked at the ultimate total of Duffy’s $90,000 bill, however, Nigel Wright stepped in to pay the bill himself — apparently without Harper’s knowledge. Harper has called that a “deception.”

But emails included in Wednesday’s explosive new RCMP court filings quote Wright as getting a green light from Harper when the original plan was to have the party pay. The plan was to be kept entirely secret.

“I do want to speak to the PM before everything is considered final,” Wright wrote in one February dispatch.

An hour later, he followed up: “We are good to go from the PM…”

Asked late Wednesday whether the prime minister was asked in February to approve such a plan, Jason MacDonald, a spokeman for Harper, offered a one-word answer: “No.”

The 80-page court filing provides an unprecedented look into the months of discussions that took place inside the Prime Minister’s Office and the Senate on how to deal with the Duffy problem.

In several cases, the documents illustrate senators and staff clashing or badmouthing each other behind the scenes as Stephen Harper’s office intervenes directly in an effort to manipulate the activities of Senate committees.

RCMP Cpl. Greg Horton alleges senior Conservatives went to great lengths to agree to Duffy’s list of demands to ensure he would say publicly he had repaid his living claims, thus making a political headache go away.

Email chains and details from police interviews also make clear exactly who was in the loop about the $90,000 payment from Wright: at least six Conservatives, including the party’s former executive director.

That contrasts with the claims made in the House of Commons this spring that no one else was aware of the plan, and that there were no documents related to the matter.

The Mounties say they have found no evidence that the prime minister knew specifically about the $90,000 payment. However, there are suggestions in the file he might have known about other elements of the plan: “The PM knows, in broad terms only, that I personally assisted Duffy when I was getting him to agree to repay the expenses.”

When asked during question period what he told Wright he “was good to go on” in February, Harper said it was about Duffy repaying his own expenses.

“When we found that was not true, we took the appropriate action, and he has been appropriately sanctioned by the Senate,” Harper said, repeating that Wright bears sole responsibility for the affair.

The documents indicate that for the first time, the RCMP is lodging a direct allegation against Wright. Horton alleges Wright’s agreement with Duffy constitutes fraud and breach of trust because his office was used “for a dishonest purpose, other than for the public good.”

No charges have been laid against either Wright or Duffy.

Horton also said Wright appeared to be acting out of an ethical concern over Duffy’s expenses, and wanted the senator to repay them. The emails show several instances over the months where Wright appeared to be exasperated with Duffy. He also refused to promise the senator that the matter would not be sent to the RCMP if warranted.

In a terse, three-sentence statement issued Wednesday by his lawyer, Wright insisted his intentions were noble and that he did nothing to break the law.

“My intention was always to secure repayment of funds owed to taxpayers,” he said. “I acted within the scope of my duties and remain confident that my actions were lawful. I have no further comment at this time.”

The trouble began nearly a year ago, when media reports questioned whether Duffy was actually a resident of P.E.I., since he appeared to spend most of his time in Ottawa. He had been claiming that his longtime Ottawa home as a secondary residence.

Wright told the RCMP that after reviewing Duffy’s details, he felt that the senator’s expenses were unethical. A back-and-forth ensued, with Duffy refusing to admit fault.

Finally, the two sides came to an agreement. Duffy had conditions to doing a public mea culpa, including: that an independent audit into his expenses not draw conclusions about his residency, that he be repaid and that Conservatives publicly say he meets the requirements to represent P.E.I.

At the time, the secretive Senate internal economy committee was reviewing his expenses, along with those of three other senators.

“I noted this is all conditional on agreement on the (public) statement and communications bounds being respected by the senator,” PMO lawyer Benjamin Perrin told Wright about striking a deal with Duffy.

Wright says he then contacted Sen. Irving Gerstein, the head of the Conservative Fund of Canada, and asked if it would cover what was at the time believed to be $32,000 in disallowed Duffy expenses.

Wright says Gerstein agreed; Gerstein told police, however, that he only said he would “consider” the idea.

That contradicts what Gerstein told Conservative party members earlier this month: “I made it absolutely clear to Nigel Wright that the Conservative Fund of Canada would not pay for Sen. Duffy’s disputed expenses, and it never did.”

Indeed, the fund refused to pay once the bill topped $90,000. It was then that Wright decided he would just repay the amount himself.

But things did not go smoothly.

Although Wright and his team had agreed to ensure the Deloitte audit did not make a conclusion on Duffy’s residency, they couldn’t get confirmation that would happen. Wright expressed his frustration to Sen. Carolyn Stewart Olsen, a member of the internal economy committee’s three-member steering group.

“Somehow, despite agreement to this in advance from you, (Senate leader) Marjory (LeBreton), and (Sen.) David (Tkachuk), no one on the Senate side is delivering,” fumed Wright.

Stewart Olsen responded by complaining about her colleagues.

“Confidentially both Marj and David are telling each other the audit will not be pulled… I think the only way to do this is to tell Deloitte that we are satisfied with the repayment and end the audit,” she wrote.

“The non-partisan nature of the committee is a problem as is the (Senate) clerk who seems to have his own agenda.”

Senate clerk Gary O’Brien later told police that he had discussions with Stewart Olsen about “her partisan behaviour and a disagreement about her not acting properly as an audit sub-committee member.”

Gerstein then swung into action as well, contacting someone he knew at Deloitte to find out what was going on with the audit. The message back to PMO, via Gerstein, was that Deloitte was unable to make a clear statement about Duffy’s residency, because he hadn’t provided them with enough documents.

That appeared to work out perfectly for the PMO and for Duffy.

“I would propose that the senator continue not to engage with Deloitte,” wrote PMO staffer Patrick Rogers. “I believe that we should make arrangements for repayment knowing that Deloitte will not say one way or another on his residency.”

At that point, attention turned to the Senate committee, and how to ensure that the Duffy review was quietly put to rest with an anodyne report.

“We are asking them to treat the repayment as the final chapter of the expenses issue relating to his designation of the P.E.I. cottage as his primary residence to this point in time,” Wright wrote to his staff. “That is something to which Sens. LeBreton and Tkachuk and Stewart Olsen already agreed once.”

Behind the scenes, Wright and his staff allegedly worked with Stewart Olsen to change the text of a Senate report into Duffy’s expenses, making it much milder than similar reports made on senators Patrick Brazeau and Mac Harb.

“I just met with (Stewart Olsen). I gave her our changes. She agreed with them 100 per cent,” Rogers wrote to Wright and others. “I reinforced with her that the implementing of all the changes to the report was the fulfillment of her commitment to Nigel and our building.”

But again, there was another hiccup.

A staff member in LeBreton’s office, Chris Montgomery, balked at allowing the Prime Minister’s Office to intervene so baldly in the affairs of a Senate committee. LeBreton would later tell police that it was Stewart Olsen who said the committee should not write a critical report on Duffy.

“Do I need to call Marjory? They think they are hurting Duffy, but they will end up hurting the prime minister,” Wright wrote to his staff when he got wind of the obstacle.

Finally, LeBreton’s office appeared to be brought to heel and the report emerged with the most critical paragraphs deleted, passed with the help of the Conservative majority on the committee. LeBreton later lost her position as government Senate leader, and Montgomery left Parliament Hill.

The audit and the Senate report into Duffy’s expenses were released publicly on May 9, and LeBreton declared the matter closed.

But the Pandora’s box was to explode very soon afterward, when word of Wright’s $90,000 repayment was leaked to the media the following week.

“The Senate was being run out of the Prime Minister’s Office; we know that,” Mulcair said.

“But there lies the paradox. The same prime minister who controls everything out of his office says the only thing he doesn’t control is his office. He didn’t know what was happening with Nigel Wright.”

Duffy’s version of events, detailed in two speeches to the Senate, put another spin on his negotiations with Wright and others. Duffy said that he was coerced into admitting fault, on the threat of losing his Senate seat. He also said the PMO gave him a detailed communications plan to follow. Emails in his possession have yet to emerge.

Duffy, Brazeau, Harb and Sen. Pamela Wallin were all suspended without pay from the Senate on Nov. 5, following a heated debate in the upper chamber.

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