SNC-Lavalin crisis deepens as Gerald Butts resigns

CHRIS MacLEAN  –  Feb 2, 2019

The details of behind-closed-doors dealings to keep SNC-Lavalin operating and its leadership from behind bars have been leaking out all over the place and threatening to take down the government in a flood of accusations.

The first surprising move by the Prime Minister came on 14 January, when then Justice Minister Jody Wilson-Raybould was "demoted" to Minister of Veterans Affairs. While this is an extremely important portfolio, the role of Attorney General is a highly visible and crucial to the entire country. As such, rumours and innuendo began to swirl as the rest of the country tried to make sense of a move that seemed to come out of left field.

Then came the Globe and Mail article whose sources allege that Wilson-Raybould was ousted for not playing ball with the PMO team trying to keep the SNC-Lavalin Group on the playing field. That may sound like a bit of a stretch to oust the Attorney General, but assertions that thousands of jobs would be "lost" in Quebec seems to have been a big argument in favour of willful blindness on the part of politicians shielding a company from the rule of law.

The PM circled Wilson-Raybould and insisted she had been free to make her own decision as the Minister of Justice, and pointed to he continued role in Cabinet as evidence that all was well. Ms Wilson-Raybould promptly resigned, prompting the PM say he was "surprised and disappointed" by her decision, and sending political commentators into a frenzy.

If the PM was surprised by that resignation, I can only imagine his dismay at the resignation yesterday of his friend and most trusted political advisor, Gerald Butts. While "categorically" denying that any pressure was put on the former Attorney General, his resignation letter is confusing to those holding on to the hope that the PMO did nothing to influence the legal system of Canada.

"My reputation is my responsibility and that is for me to defend. It is in the best interests of the office and its important work for me to step away," said Butts in his resignation letter on 18 February – which leads to many more questions.

This current political fiasco stems from the 2001 to 2011 timeframe. In 2015, the RCMP's international division laid charges of corruption and fraud related to allegations of SNC-Lavalin bribing Libyan officials and defrauding organizations in that country. SNC-Lavalin face a 10-year ban on bidding on Canadian federal government contracts if convicted.

SNC-Lavalin's past is heavily marked by business-ethics scandals. In 2013, following investigations into bribery schemes, the World Bank banned SNC-Lavalin from bidding on any construction contracts under its auspices for the next 10 years. And this culture of bribery has been alive and well at home as well. As reported by CTV in November 2018, a former manager at the McGill University Health Centre pleaded guilty to accepting a $10-million bribe in return for helping engineering firm SNC-Lavalin win the contract to build a major Montreal hospital and research centre.

The former CEO, Pierre Duhaime, subsequently pleaded guilty to breach of trust, admitting that SNC paid a whopping $22.5-million to two top managers of the Montreal superhospital, to help them lock in the bid.

With the selection of Neil Bruce as CEO of the beleagured company in 2015, it was asserted that, after years of fraud, money laundering and bribery scandals, SNC-Lavalin had "cleaned house". Is it too little, too late?

– Chris MacLean