Brian's Song: Day Four - Macleans.ca

Brian’s Song: Day Four

When it comes to those cash payments, Mulroney was just trying to be more European

by

Brian's Song: Day FourIs it possible Brian Mulroney is just making it up as he goes along? I know we were all told how well prepared he was for cross-examination, but the more he fleshes out the details under questioning, the more bizarre his already fantastic story becomes.

Yesterday he told the Oliphant inquiry three extraordinary things we hadn’t heard before.

One: The reason he agreed to be paid in cash, despite his initial “hesitation,” after Schreiber explained that he was “an international businessman,” was because he knew that’s the way they did things in Europe. North America, people paid by cheque. Europe, they “had different approaches.” No European businessman he’d ever personally dealt with, mind you. But, you know, he was “generally aware” of the practice.

What he was not at all aware of, however, was the reason they did things that way. Only years later, after he had joined the boards of several international companies, did he learn that these European businessmen were actually using the cash to pay bribes to politicians. Why, do you know, in Germany they could even write it off on their taxes?

But as of 1994, when he accepted the last of three cash payments from Karlheinz Schreiber, he was not aware that European defence and aerospace industry representatives were in the habit of bribing politicians with cash — still less that Schreiber was in any way acquainted with this art. The RCMP’s 1995 allegation that Schreiber had been doing just that on behalf of Airbus did nothing to shake his belief in Schreiber’s integrity.

Not until 1996 or 1997, he says, did he start to understand what European businesses did with their cash, and not until Schreiber’s 1999 arrest in Toronto on fraud and tax evasion charges did he at last realize what kind of man he was dealing with. At which point he decided to declare all the cash Schreiber had paid him on his taxes, without claiming any expenses.

Two: The other reason he did not demand to be paid by cheque was because, at the start of his post-political career, he did not have any support staff. He had not yet begun work at the Montreal law firm of Oglivy Renault, and was living north of Montreal. Had he an office, and staff, and had he met with Schreiber in the more businesslike setting of his office, rather than in hotel rooms, he might have suggested that a cheque would be more appropriate.

But that still doesn’t explain why he left in in cash. On that subject, he had less to offer. Typical was this, verbatim exchange:

Q. Why didn’t you put the money in the bank?
A. Well, I brought it home and I left it there.

Or:

Q. Why did you not put the money in Cansult [his consultancy business] or in a bank, to create transparency?
A. I simply wasn’t thinking that way at the time. I’d begun the process like that and maintained it like that.

Perfect. Why did you do it? Well, you see, it’s what I did.

Three: The UN role he foresaw for the Bear Head vehicles, the subject of his representations to Francois Mitterrand, Boris Yeltsin, and Caspar Weinberger (though not James Baker), was that they would be dropped off in hot-spots around the world and left there, for rapid mobilization in case any trouble broke out. Under the control of the local government, Judge Oliphant asked? Say, in Rwanda? No, no, Mulroney said: they would be maintained under UN control at all times.

Mind you, he was also alert to the possibility that one or another of the governments he was lobbying might want some for their own uses. In which case he was ready to get on the phone to Fred Doucet, who would call Schreiber — for some reason Mulroney never contacted Schreiber directly, even after he left office — to tell him he had an order for 250 or 500 vehicles or what have you. He was asked: To be supplied by … whom? The Bear Head factory, after all, had yet to be built.

This is not the first time his story of what he was doing for Schreiber’s cash has evolved. When William Kaplan, the lawyer and historian who broke the story, first confronted Mulroney’s spokesman, Luc Lavoie, he was told that it was for services related to Schreiber’s pasta machine business, including “organizing meetings with senior international executives” and “advising on international business transactions.” As Kaplan told the inquiry, the story went through several versions after that.

The second thing Mr. Lavoie told me that the money was to lobby for Bear Head.
The third thing Mr. Lavoie told me was it was for to work on behalf of a client and it was covered by solicitor-client privilege.
The fourth thing Mr. Lavoie told me and the world was that Mr. Mulroney was poor and needed the money and that’s why he ‘went for it.’

In the nearly two years between his first conversation with Lavoie and the story’s eventual publication in November 2003, Kaplan and Mulroney talked perhaps a dozen times, as the former prime minister desperately tried to persuade him not to reveal his secret. In all that time, Kaplan says, Mulroney never once disclosed that he had actually been working on a perfectly legal and above-board plan to sell peacekeeping vehicles to the UN. The first he heard about his visits to China, Russia etc was when Mulroney testifed in front of the ethics committee in 2007.

But then, as we know, had Mulroney been asked about it in 1996, he would have told the court everything. Or would he? Again, from Kaplan’s testimony:

MR. WOLSON: … you say that Mr. Lavoie strongly objected to any suggestion that Mulroney engaged in any improper activity, and pointed [out] that there were nine lawyers — obviously, talking about the discovery —
MR. KAPLAN: Yes, sir.
MR. WOLSON: — and none of them ever asked Mulroney if he received any cash from Schreiber or anybody else.
MR. KAPLAN: Yes, sir.
MR. WOLSON: You say, from Mr. Lavoie, the following: “Moreover, had anyone made that request they would have been answered with —

The truth? The whole truth, and nothing but the truth?

— the fact that the relationship was privileged.”

Oh. How terribly disappointing.