This is an order of the committee, and I'd like to follow the order of the committee.
We have a witness before us. To the witness I will say that I know that you've brought in your legal counsel. Parliamentary privilege rules on the rights and duties of witnesses say:
||Witnesses giving testimony who wish to be assisted by counsel must ask leave of the committee, although permission is seldom sought. Counsel is restricted to an advisory role and may not ask questions or reply on the witness' behalf.
I would like to seek the committee's permission for legal counsel to stay. Is the committee in agreement that we can let Mr. Groot stay?
An hon. member: Agreed.
The Chair: Ms. Mendes, did you...?
Madam Chair, members of the committee, unaccustomed as I am to be present in front of a parliamentary committee, forgive me for taking a few moments to make a statement, and perhaps, through you, I may be offered a bit of latitude.
I've worked in the private security investigation industry for 20 years. I've worked with clients in Europe, the Middle East, Africa, and Central America. I've held investigative licences across Canada, with the exception of British Columbia and Saskatchewan.
I believe the reason I've been summoned here today before this committee is to offer insight into the media frenzy surrounding a former cabinet minister and current member of Parliament.
My role to many of you in this room may be confusing and misunderstood because of what I do. I believe I speak for all of my clients in the insurance industry, the banking sector, and government who choose to remain anonymous because they, like me, believe that neglect is the ally of many. It is because of neglect that investigators are retained. The job of investigators, if you will, is to dig into people's activities and statements. Your role too is to examine the issue before you.
The notion that neglect is an ally is a strong statement. It presupposes that, as normal everyday respectful citizens, we take what people say as the truth. In fact, one can make the absolute leap that what generally happens in this place is built upon that premise.
Most importantly, Madam Chair, neglect is not the purview of this place. It is all around us and in our everyday lives, and neglect as an ally is the reason clients seek my counsel and professional skills as an investigator in the first place.
When the facts I uncovered as an investigator regarding the proponents of this committee's mandate came to light, I sought the advice of friends who understood far better than I how things here in Ottawa work. I agreed to meet the client's wishes and contact individuals in public office, be they functionaries to politicians or politicians themselves. When I brought to light the issues that appeared to affect the government, I advised the government.
The reaction of the government, albeit a part of the mandate of this committee, has nothing to do with me. It appears, however, I am an unwilling participant in this little drama.
I'm here, Madam Chair, because your committee believes I can shed some light on this matter. I hope that my presence here can help clear up some of the misconceptions about this matter, and that I can move on as an investigator in my professional life.
Madam Chair, through you to the committee members, I humbly submit that this matter has been, and is, a tough issue to manage through for the individuals who are at the centre of it. Many people have made assumptions about the evidence and information I collected during the case, and many people have made assumptions about the investigation as a result of media spin. I appear before you today to speak to the facts and connect the dots, as I did with the clients and victims during the investigative process.
Many friends with whom I have spoken have felt there is far too much being made of this issue in the first place, when it appears to have effectively been dealt with by the Prime Minister.
I hope and trust my presence here today will serve to offer a perspective and close this chapter, and that we don't neglect those other important matters that we look to you to manage.
I really appreciate your being here today. As you said, this is about getting to the truth and speaking to the facts, so I'm glad you made that as a point in your opening statements, and we'll certainly get to that.
I just want to ask a couple of questions to begin. You had information that you felt was significant enough to bring to the attention of the Conservative lawyer Arthur Hamilton, I believe his name was. What information exactly did you bring to Mr. Hamilton's attention?
Certainly. Thank you, Madam Chair.
Despite the provincial letter we're talking about here, there's no problem with the committee asking for the documents. The committee can send for records and they can even be summoned. They're protected, however, by parliamentary privilege, and as we know, they cannot be used in another place.
However, given the confidential nature of the documents Mr. Snowdy is referring to, the committee might want to consider a mechanism by which the confidential tabled documents could be protected by either looking at them in camera or by finding a way of looking at them so that some of the information is protected. It's for the committee to decide how they want to deal with the situation.
Thank you very much, Madam Chair.
Mr. Snowdy, thank you for being with us today to assist us in broadening our study of the renewable energy projects financed by the government. Unlike by opposition colleagues, I'm going to focus my questions on the subject the committee agreed to examine today.
Mr. Snowdy, have you previously had any business dealings with Mr. Jaffer and Mr. Glémaud or with other individuals from the Green Power Generation Corporation?
Thank you, Madam Chair.
I think it's very important to know everyone involved in this entire affair, which has certainly sparked a lot of interest amongst parliamentarians and those around the country.
The first question I have for Mr. Snowdy is this: does the president of the Liberal Party, Alfred Apps, have a relationship with Nazim Gillani?
That was one of the situations we grappled with on April 8. Mr. Gillani had made representations that he was represented legally by Mr. Alfred Apps at Fasken Martineau. I did some investigating and found out that indeed Mr. Apps did work for Mr. Gillani. In fact, Mr. Gillani had paid a retainer to Fasken Martineau with respect to litigating one of Mr. Gillani's previous victims into bankruptcy. The counterclaim to that action was a cookie cutter for Mr. Gillani's other fraudulent business activities. That case was transferred from Fasken Martineau to another Toronto law firm to litigate. I've actually tracked down the email in which Mr. Gillani discusses with counsel of the other firm the transfer of the retainer from Fasken to their firm.
Mr. Apps had been Mr. Gillani's counsel in that matter and in fact helped to construct one of the issues. One of the fears my client had was of being litigated by Mr. Gillani and Mr. Apps when they came forward, as he did bankrupt the other victim.
In that matter, that case is an Ontario Superior Court case, 07-CV-329370PD3, and the counterclaim to that action from the defendants is, as I said, the cookie cutter for how these other frauds were committed. The email attached to the back of it in the affidavit refers back to the issue at Fasken, and I did call Fasken and spoke with a clerk with respect to identifying their case file representing Mr. Gillani.
The issue my client dealt with on the day was that as things spiralled out of control here in Ottawa and Mr. Ignatieff was calling on the Prime Minister for information on Ms. Guergis.... I mean, eight days before, he was calling for the woman's head on a platter, and now he was taking certain conduct.... My clients were getting more and more nervous, knowing full well that Mr. Apps was the getaway driver for Mr. Gillani in a previous encounter.
I did research this morning, and apparently this court file is missing from the Toronto courthouse, but, luckily enough, I have a copy of it.
Mr. Snowdy, when you were undercover and meeting with Mr. Gillani, he led you to believe that he could set up or had set up bank accounts in Belize to use as shell corporations, or whatever people use offshore bank accounts for. In an interview with the CBC, you said that you actually picked out a name of a shell company in Belize. He said that it was already held by Mr. Jaffer and that he would put you in touch with Mr. Jaffer and you could talk about that.
Do you remember the name of the company on the list that he said was actually being held for Mr. Jaffer?
I actually know a bit about these types of transactions. Part of my investigative field is these types of transactions and financing. What I said to him was that I'd take the top three oldest incorporations.
Now, if I were interested in conducting offshore activities that way, the reason I would want the three oldest commercial companies is that once they're past the incorporation date by a year, under some Central American banking agreements they qualify for commercial credit. If you were going to wash money through--deposit stock, sell it, and deposit the cash into an account--what you would do then is get a corporate credit card, say a Visa or MasterCard, and you would just spend money paid into that account, rather than try to take cash out through an ATM machine, which is what Mr. Gillani was suggesting: creating ATM machines in Central American banks, and people would draw it out here at white-label machines.
Perhaps it was for the same reason that we had some concern. The concern here is optics. Bluntly put, sir, on March 31 the leader of your party and the leader of the Liberal Party were calling for this woman's head on a platter, and had been doing so quite regularly.
Now, as the story broke.... I think it's very important here to understand that I was contacted by the Toronto Star, which was already working a story with respect to this. I consulted with the clients, and they allowed me to speak on certain topics. I had spoken to the Star at the beginning of March. When that story came out on April 8, weeks later, I was already scheduled to leave on a business trip on Sunday morning. The first calls I got were saying, “We didn't want to talk about this.” I said, “Well, I have news for you: I didn't. This is Mr. Donovan's investigation. He's done a hell of a job. He has own sources--”
The problem was that some of the most outlandish things he said were coming true. He would hit the craziest ones out of the park as being factual. He would say, “I'm doing business with Mr. Jaffer, and he's a partner.” Well, what do we know? We know that he did do business with Mr. Jaffer, or he was in a relationship.
He sent out a text message to someone on the night of September 12 saying, “I'm out to dinner with Rahim and his wife, the minister.” We went and checked, and sure enough, he was out with her. He'd indicated that he had connections to members of organized crime from the west coast; we made some inquiries and found out that he did attend a party in the company of some known members of organized crime out west.
He was already in very weird situations. His--
Yes, if I pursue the thought, earning Mr. Jaffer's confidence also meant securing the contacts that the latter could provide him, political contacts among the Conservatives that Mr. Jaffer could provide him.
Mr. Gillani does not deny that he sent an email on Friday, September 11. In that email, he said he had had quite an overwhelming experience the previous evening, during a dinner with Rahim Jaffer and Dr. Chen. He said that Mr. Jaffer had opened the door of the Prime Minister's Office to them.
What do you think does opening the door to the Prime Minister's office mean?
Thank you, Madam Chairman.
I want to follow up on the first round of questioning.
Originally when this issue came to the forefront in the House of Commons, we saw Liberal MPs such as Wayne Easter saying ferociously that Helena Guergis should be kicked out of cabinet, and it couldn't have been a day too soon. All of a sudden that changed, and then it was, “How come you kicked Helena Guergis out of cabinet?” This makes me wonder why we've seen this change in the Liberal Party position. Maybe it has to do with the person that you described as the getaway driver for this serial fraudster, as you have described Mr. Gillani.
Could we start off by having you describe what you meant when you said “getaway driver” in reference to Alfred Apps, who, once again, is the president of the Liberal Party of Canada?
Obviously when you retain a lawyer to represent you and act in your interests, the lawyer becomes privy to your conduct and your matters.
In the case of Aerofoam Metals, Mr. Gillani holds them out as his client, and a successful client, when in fact they were not a client of ISI, but a client of his previous company, Otnorot Holdings. These people were looking to them to support their business, to finance them, to allow them to continue in the business. When they objected to Mr. Gillani's conduct--they were paying for moneys, and he was receiving moneys from investors, but never forwarding it on to them--and decided they'd try to walk away from Mr. Gillani, he used the legal process to put a claim against them, to burn up the remaining capital, and basically to force the company into an insolvent position.
The lawyer involved in getting that together obviously becomes aware of how his client conducts himself, and the counterclaim to that action lays out Mr. Gillani's egregious conduct in technicolor.
The person who uses the squeeze.... Mr. Apps is not an associate at a small firm. When Mr. Gillani embarks on dragging someone whose name is important into his business dealings, obviously there's a bit of fear and intimidation that comes with it. My interpretation of that is that this is somebody who had full knowledge of how Mr. Gillani conducts himself.
Mr. Gillani was very much the subject of that article in the Toronto Star on April 8, so when you have a....
Thank you, Madam Chair.
Obviously we don't have Mr. Apps here today. We have Mr. Snowdy, but the question I'd ask Mr. Apps is about the statement that the relationship was discontinued shortly thereafter. They don't specify the length of time in that statement. We would certainly be interested at this committee as to how long that relationship continued.
I'm wondering, Mr. Snowdy, if you know when the relationship with that law firm.... Earlier you referred to some documents that relate to the relationship. Do you have any dates on those documents?
Thank you, Madam Chair.
I think that would be helpful. We all would be interested in those documents, because I think they may help establish the timeframe in which this cozy relationship continued.
Today we've covered a number of different things. Obviously, as you stated earlier, we've had a committee meeting that discussed many things, but we didn't get too much discussion as it related to renewable energy projects. You stated earlier that you had little or no information as it related to the green fund. I want to clarify that again. Do you have any information as it relates to funds being allocated to different projects from the green fund or things that are funded by the government for renewable energy projects?
Madam Chair, the motion that we originally had in this committee was related to those types of projects. We were very interested, as a committee, to ensure that taxpayer dollars weren't going to places that they shouldn't have gone. Clearly today we haven't moved forward in terms of that study. Certainly we appreciate the information that you've brought, Mr. Snowdy, but to be honest, it is of limited relevance to the study that we're currently undertaking. You've already stated in general terms that you have no information as it relates to renewable energy projects that are funded by the government either.
Madam Chair, I think we have some committee business that we would like to attend to in this committee. There are probably other people who would like to ask questions, so I will turn my time over to those members, and then I think we should get on with the committee business.
Thank you, Madam Chair.
Mr. Snowdy, when I asked you how you thought Mr. Gillani earned his living, you answered in a direct manner. I ask you the same question concerning Mr. Jaffer. How do you think he made money? His association with Mr. Gillani was not a charitable or philanthropic organization. Mr. Jaffer and Mr. Gillani told us, when they testified, that they had not made a lot of money, but that they had done a lot of canvassing. How could Mr. Jaffer earn money?
It would be through Mr. Gillani's schemes and the way this system works and plays.
I believe it's you, sir, who has a very good source for some of this information. I think you asked Mr. Gillani about the Skias deal. It struck a note. Not many people knew about the Skias business deal, but let me use that as the example of how Mr. Jaffer would then be compensated in this scheme.
Am I correct, sir, that it was you who asked Mr. Gillani about the Skias business arrangement? No, I see that it was Mr. Martin.
Skias was supposed to be a 100-million-share shell deal from a U.S. company. It would then be rolled out to supposed investors in a pump-and-dump scheme at $1 a share, so it was a $100 million business venture. I'm sure we've all seen documents on these types of legal activities; they're copious, and Greenpeace has a fit over the number of trees that are cut for paper.
This is Mr. Gillani's business deal for the $100 million deal: it's one page long, it's four paragraphs, and it's how to obtain the shell corporation.
The shares in that shell corporation are then distributed to nominee account holders, the purpose of which is to avoid the regulations in the securities industry for disclosing more than 10% ownership. Mr. Gillani constructed this list of nominee shareholders by which people would receive shares in the company, and they included principals in the actual corporation. What Mr. Gillani forgot to do when he did this deal was to include himself as a person receiving shares, but all of his nominee shareholders, their children, and various holding companies, etc., are on this list.
This is how Mr. Jaffer would have made money. I think the reference that the Toronto Star reported on was Wright Tech. If we take Wright Tech as an example and say that they're rolled into a shell deal, what would then happen is that a corporation or an individual account at an investment firm or at an offshore bank would be established, and stock in that company would be deposited into those accounts and then sold into the public market during the promotion phase of the market manipulation activity. That's how Mr. Jaffer could be compensated. It would be in accordance with Mr. Gillani's previous schemes.
Mr. Snowdy, I've just reviewed the documents you've given us. So that the committee is clear on what it is receiving, I would like to read it out. Because it's not bilingual, I'll have to read out what we have received.
We have an ISI deal memo signed by Nazim Gillani, but Israel Goldreich is not signed, with a schedule A with the identity of shareholders, and another ISI deal memo.
The second one I have is your timeline, the ISI-GPG timeline--
Okay, so it's August 20, 2009, and it ends April 13, 2010, with Rahim Jaffer and the trip.
Then there is an email from Nazim Gillani to Ian Harvey.
Then there is one from Nazim Gillani to Michael Mihelic, on January 25, 2010; Canada Revenue Agency, April 6, 2010; and one from Rahim Jaffer to Alexander Prince, dated March 30, 2010.
What you have done is given us the claim and counterclaim. I just want to clarify so the people here know that. It was between Otnorot Holdings and Nazim Gillani and Paul Colacci. It's a statement of claim, and the lawyers--
We relied on Mr. Gillani's statement to the clients that he was represented by Mr. Apps, and then we made contact to find out that his retainer to Mr. Apps was with respect to that file and that Mr. Apps had deferred the litigation to Teplitsky, Colson.
That was significant, because during the meeting when Mr. Gillani was trying to sell these offshore companies to individual nominees for HD Retail, he was saying that they should buy an offshore corporation from him for $7,500 U.S. First of all, I knew that it costs $3,000 to establish an offshore corporation, not $7,500, so I knew he was looking to pocket $4,500 per company from each of these individuals.
He then tried to take his scheme a step further and suggested to everyone at the meeting that locally those offshore corporations were administered by Teplitsky, Colson. Now, Teplitsky, Colson is a litigation firm with no business office. It made about as much sense to me as going to a neurosurgeon for a vasectomy; they weren't compatible, but Mr. Gillani didn't know that I had that knowledge.
You'd have to go to the affidavit in the file.
Originally Teplitsky, Colson looked to get off the file because there was a payment issue. I had a hard time tracking down Mr. Gillani's support that Mr. Apps was indeed his counsel. I made a pretext call to Fasken Martineau to speak with the clerk, who indicated that Mr. Gillani's file was attached to Mr. Apps.
We further went through the email between Mr. Gillani to David Greenwood at Teplitsky, Colson, wherein he references the retainer coming from Fasken Martineau to Teplitsky, Colson, in order to pay them for the litigation procedure.
Thank you, Madam Chair.
Thanks as well to my Conservative colleagues for giving me this opportunity.
I would simply like you to explain to us in two minutes what the procedure is for opening offshore bank accounts, such as those opened by Rahim Jaffer in Belize. Are signatures required, pieces of identification? If possible, do you have in your possession any documents that might enlighten the committee, signatures, for example?
I actually broke a tooth the night of April 8 when I was grinding my teeth watching the news. I got a phone call at two o'clock in the afternoon of April 9 from a man who identified himself as Mr. Eppo Maertens. He provided me with his name and telephone number. I was going into the dentist to have my tooth repaired and I told him I would phone him back.
I made some preliminary inquiries. I tasked one of my assistants to find out who Mr. Maertens was and I was out of the dental chair at 3:30. I received a report back that Mr. Maertens was an employee of the Ethics Commissioner's office. At four o'clock in the afternoon I returned Mr. Maertens' phone call.
Mr. Maertens said to me that he had received a letter from Mr. Guy Giorno in the Prime Minister's Office that indicated that I had made specific allegations and claims against a member of Parliament.
I asked him if he would read me the letter. He put me on hold for a minute and a half, came back, and read to me a letter that had my name in it several times. It said that Derrick Snowdy said this or said that about the conduct of the minister. I said, “No, I did not say that. No, sir, I did not say that.”
I have very short time, so I have one last question, if I may.
I'm curious about something that you put up on your Facebook page on Monday, April 19. You wrote something like, “No hearings, huh? Hm. Methinks someone spilled the beans to Jack. Now he wants it hushed. I guess he knows now how close this is going to hit home with a certain NDP, and he needs time to prep".
Can you tell us what you meant by this?
You know what? I think that's what I wanted to highlight.
You can repeat as many times as you like that Mr. Jaffer had access to the Prime Minister's Office, but that doesn't mean it's correct. You can repeat a wrong statement 10 times, and it's still wrong.
I mentioned this before on a show. Every year partisans of the Maple Leafs say, “We're going to make the playoffs this year.” It doesn't mean the Maple Leafs actually make the playoffs. It's boasting. I think that in this case there clearly was boasting, but with no actual facts to support the claim.
In your investigations of Mr. Gillani, did you find any evidence of even remote success, any success at all, in his lobbying or in accessing any part of government?
I'm a good Catholic girl, but it says it is an effing good deal, a great deal. Thank you for putting me in that awkward position.
The point I want to make here is that at the beginning of this you said there was privileged access, special access, being given, and clearly the client that you represented was that, but I want to go back to a point that we were talking about before. You talked about Mr. Hamilton and said that you have met with him several times since. When we unfortunately ran out of time, you were starting to describe some of what you were discussing in those meetings.
We established the first one and what you were discussing. It was along the lines of, “Could this happen? Yes or no?” You said that in the next meetings you were able to have a more forthright discussion with him. Could you describe those discussions, please?
What we will do, then, is go over the facts in terms of our current study. We do appreciate your attendance here, Mr. Snowdy.
It's clear to me that the facts remain the same as what we believed them to be when we showed up here: no taxpayer dollars were given to Mr. Jaffer and Mr. Gillani in relation to anything they were working on or any of the companies they were working on behalf of in terms of the renewable energy projects or the green fund in general.
I'm wondering if I can get you to confirm, having gone through today, that we're not unclear about that point--that you have no evidence and no testimony to provide to us that Mr. Gillani or Mr. Jaffer received any funds for themselves or for their clients from those funds for those types of projects.
I appreciate that, because that truly is what we, as a committee, are undertaking in terms of our study. We're trying to look at two issues. Number one, was there money given? Number two, was there inappropriate lobbying happening?
We have you here today and we appreciate your testimony, and I think we confirmed early on in this meeting that, in fact, you had no evidence to provide us on those points; we respect and we appreciate that. You've been forthright on that point and you've given us some additional information about peripheral issues.
I only want to give you one additional opportunity to confirm that in fact, as far as you know, no money was given, and that you have no information to provide to us in terms of the lobbying activities that were or were not happening on the Hill.
Thank you, Madam Chair. I appreciate your recognizing me to introduce this motion and have it debated here today.
This motion is primarily an opportunity for a member of Parliament in good standing, Mr. Derek Lee, to address the information that was present on the Sun and Partners website that indicated that some of the elements he provided to that firm. Quoting from that website, as you can see in the motion, I'll just briefly read out that they:
||...include acting for foreign and offshore organizations in obtaining operating licences, securing regulatory and governmental approvals for mergers and acquisitions...advising government bodies on international issues regarding cross-border tax collection, anti-dumping issues, and lobbying government on policy issues as well as facilitating intergovernmental relationships
The primary point of this motion is requesting our committee to look into this and perhaps have Mr. Lee advise the committee as to why this occurred. I have spoken with Mr. Lee subsequent to introducing this motion; he seemingly was interested in elucidating on this information.
That is the motion, and I look forward to hearing further debate from the members.