Ethics and accountability

From the October 2023 print edition

There is an increasing public perception that those who hold high office are free to violate public procurement rules with impunity due to weak enforcement mechanisms. However, recent legal rulings reveal that procurement irregularities can lead to serious legal consequences, including criminal convictions.

Paul Emanuelli is the general counsel of The Procurement Office and can be reached at [email protected].

Weak sanctions
During his term as Prime Minister, Justin Trudeau has been the subject of three separate conflict inquiries conducted by the federal Conflict of Interest and Ethics Commissioner.

In December 2017, the Commissioner found that Trudeau breached the federal Conflict of Interest Act by accepting multiple vacations to a private island owned by the Aga Khan, a philanthropist whose projects have received over $300 million in federal funding since 1981. The Commissioner found that Trudeau breached the statute by accepting gifts from a party who had ongoing official business with the government, for which Trudeau could advance and influence future spending decisions.

Further, in August 2019, the Commissioner found that Trudeau breached the conflict statute when he attempted to influence the criminal prosecution of SNC-Lavalin, a large Canadian engineering company that was charged in 2015 under the Corruption of Foreign Public Officials Act for allegedly bribing Libyan government officials.

Finally, in May 2021, the Commissioner cleared Trudeau of any conflicts connected to the WE Charity contracting scandal. While the Commissioner found that Trudeau did not influence the government’s decision to recommend the WE organization for the contract awards, Trudeau acknowledged that the optics of awarding high-value government sole-sources to an organization with prior business dealings with his family members should have resulted in his voluntary recusal from the award decisions.

Even more recently, in December 2022, the Commissioner found that Mary Ng, the Minister of International Trade responsible for Canada’s trade treaties, including treaties that govern public procurement rules across Canada, breached the federal conflict statute by awarding two low-value emergency government sole-source contracts to a firm owned by her friend.

While the Prime Minister and Minister of International Trade were both formally found in breach of the federal conflict law and suffered the resulting public censure, the lack of enforcement mechanisms under that statute meant that both remained in office without even being fined the equivalent of a speeding or parking ticket.

Procurement-related prosecutions
The above rulings may lead some to believe that senior public officials can breach government contracting rules with impunity. However, while weak enforcement mechanisms may encourage the normalization of improper conduct, recent case studies reveal that public contracting irregularities can result in successful criminal prosecutions against high-level officials who break the rules.

For example, in its January 2018 decision in R. v. Livingston, the Ontario Superior Court of Justice found David Livingston guilty of unlawfully destroying government records relating to the Ontario government’s controversial decision to cancel two gas plant construction projects. Livingston was serving as chief of staff to Ontario Premier Dalton McGuinty when he destroyed the records in question.

Further, in its March 2018 decision in R. v. Carson, the Supreme Court of Canada upheld the influence peddling conviction of Bruce Carson, a former senior advisor
to Prime Minister Stephen Harper. As the Supreme Court decision noted, after leaving his senior advisor position, Carson cut a deal with a water treatment company to use his government contacts to promote the sale of the company’s systems in exchange for commissions to be paid to his girlfriend. While Carson only received a suspended sentence, 12 months probation, and 100 hours of community service, the sentencing judge noted that by that point Carson had already suffered significant reputational and financial harm due to the prosecution.

More recently, in its May 2022 decision in R. v. James, the British Columbia Supreme Court found Craig James guilty of breach of public trust and fraud under $5,000 for improper clothing expenses claimed while serving as the Clerk of the House for British Columbia’s Legislative Assembly. James was sentenced to a term of imprisonment of three months, including one month of house arrest, two months of overnight curfew, travel restrictions outside of the province, and a restitution order to repay the funds.

Future considerations
Moving forward, since senior officials often fail to lead by example, public institutions need to build stronger institutional governance practices so that we do not have to rely on the criminal law as the means of enforcing ethics and accountability in the public procurement process.