Thursday, December 16, 2010

Why the BC Rail scandal shouldn't be forgotten

The B.C. Rail scandal is back in the news, a good thing. New information from search warrants has been released thanks to a media application.
If British Columbians decide just to forget about this scandal, we’ll have given up something as a society.
The issues are huge — corruption tainting the sale of a public railway, broken promises, bribery to exert influence in two cabinet ministers’ offices and a $6-million benefit to two offenders, at taxpayers’ expense, that encouraged guilty pleas and stopped the trial.
This is like stuff from some sleazy Florida municipal government.
The new search warrant information is grim.
It hasn’t been proved in court, but police swore that Erik Bornman, a lobbyist and political foot soldier, told them he started paying bribes to Dave Basi even before the Liberals were elected in 2001 — long before the B.C. Rail bribes.
The money was to pay for “his political support, his support in referring clients to my business and for assistance on client matters,” Bornman said.
After the election, Gary Collins became finance minister, and Basi was named his political aide. Bornman was with Pilothouse Public Affairs, a lobbying firm. Both Bornman and Basi were political operatives, working in federal and provincial Liberal campaigns, particularly active in the federal ones.
Bornman says he paid Basi, and in return Basi steered lobbying clients his way. He also got special treatment for the people who paid Pilothouse to influence government and “political support.”
There is a serious stench about this. Companies or individuals have a concern about government policy. They raise it and are told it might be wise to hire a specific lobbyist. The lobby firm pays a bribe to help get the problem solved.
And all involved co-operate to ensure the re-election of the party in power.
Too many questions remain unanswered.
Why wasn’t Bornman charged with bribery or tax fraud, since he told police he paid less in taxes because he made the bribes look like a legitimate business expense?
Who decided the people who took the bribes were a more important target than those who paid them?
And how much effort was spent ensuring these practices weren’t more common?
The search warrants include the claim Basi had bank deposits that showed unexplained income of $870,000 between 2000 and 2004. Defence lawyers say the Crown’s expert showed the real unexplained amount was $112,000.
But that’s much more than bribes paid by Bornman and capital region developers paying for Basi’s influence getting land out of the agricultural land reserve. Who else paid and benefited?
The warrants also reveal that Brian Kieran, a principal in Pilothouse, paid Basi $3,000 in cash. Basi and Bob Virk, political aide to then transport minister Judith Reid, took a free trip to an NFL game in Denver, thanks to Omnitrax, a bidder for B.C Rail. They paid for their airplane tickets to make it look legit, the warrants say, and Kieran came through with cash so no one would know about the freebie. He billed the client.
It’s all sordid and corrupt. At least some people paid money and got special treatment and favours from government. It mattered who you could pay and who you knew.
The important question is whether these are aberrations, or symptoms of an unhealthy relationship between people who float back and forth between lobbying, campaigns and political jobs in government.
And British Columbians really can’t know, based on the information that is currently available.
They know, for example, that a police search found Bruce Clark, a federal Liberal activist, lobbyist and Christy Clark’s brother, had B.C. Rail sale documents “improperly disclosed” by Basi and Virk. Clark was working for the Washington Marine Group, which was interested in buying the B.C. Rail line to the Roberts Bank superport.
But how did he get the information, and what did he do with it? Those facts have never been revealed.
The Liberals would like people to forget about the scandal. To do that, without more answers, would be to say that British Columbians are comfortable with the threat of a government corruption.


Anonymous said...

After the 2001, the Liberals set up the Ministry of Deregulation, lead by one Kevin Falcon. Falcon frequently boasted about how many regulations he managed to cut and how it boosted business competitiveness in BC.

Was Falcon, or any of his staff, ever "lobbied" by Pilothouse or its clients?

Falcon was then appointed as the Minister of Transportation after Reid's resignation/dismissal. Other than cancelling the Roberts Bank subdivision sale, what steps did Falcon take to root out the alleged corruption within his Ministry?

Anonymous said...

According to the Lobbyist Registrar,
(, Erik Bornman (sic) and Brian Kieran lobbied Falcon and his staff on behalf of Omnitrax from Oct 2002 to December 2003. They also lobbied on behalf of COFI, Famous Players (to permit the sale of alcohol in theaters) Broe Companies (Omnitrax owners). Did anyone in the Ministry of Deregulation receive a cash payment from the Pilothouse reps for preferential treatment in exchange for preferential treatment?

Anonymous said...

Both COFI and Famous Players were generous donations to the BC Liberals during this time.

Campaign contributions: 2002-2004
Council of Forest Industries

Famous Players

Anonymous said...

Only the Special Prosecutor, Bill Berardino can answer these questions and no one has asked him. He cut deals without any accountability and now Erik Bornmann can become a lawyer?

Only in our system of justice do people like Erik Bornmann escape any sentence or any punishment.

This is a shame and I hope that the media cover the upcoming Law Society of Upper Canada hearing into the "Good Character" of Erik Bornmann on March 28, 2011

RossK said...


Did you just slag sleazy Florida municipal governments everywhere?

All joking aside, you make an excellent point about the wider issue here.

Regarding that, you wondered:

"....whether these are aberrations, or symptoms of an unhealthy relationship between people who float back and forth between lobbying, campaigns and political jobs in government..."

I would argue that they are the latter.


The way the awarding of the huge casino next to the re-roofed BC Place was awarded recently.

For anyone interested, my take (from last spring) on the issue of the casino industrial complex is here.


Anonymous said...

Just shows why so many have little or no faith in BC justice.

Anonymous said...

Paul asks "The important question is whether these are aberrations". LOL. Yes Paul, this is the first and last time it ever happened. Trust us.

Then Paul asks "But how did he get the information, and what did he do with it? Those facts have never been revealed." On December 15th just past, on this site:

Alex Tsakumis published a copy of a notarized Memo to file, signed by David Basi, and dated October 14/03. In part Basi wrote "The minister stated that it would do no harm to allow Bruce to have a draft copy of the RFP to allay any fears his friends have about the process."

From the way it looks to me those facts have been revealed, and they are more than just a little bit troubling.

Raymond Graham

Anonymous said...

With family like that what kind of BC Liberal delegate support will CC get? Why would anybody support her when the voters will reject her contrived denials?

Quite simply: Money and effort put into CC's leadership bid is a waste of resources.


Where is Revenue Canada? The feds should be doing deep dive audits into all the names associated with this sordid mess. How long do individuals and companies have to keep their tax records for? Has the clock run out there too?


Off Topic

What is up with the Victoria Times Colonist's Rob Shaw and Lindsay Kines? These two are consistently putting out great articles - Well researched stuff that is clearly written. Look at today's example.

Former chief coroners and B.C.'s independent children's watchdog expressed concern Thursday about how government has encroached on the office's independence, including forcing it to submit its reports — which contain recommendations to prevent future deaths that can be critical of government policies — to the government public affairs bureau for review.
Solicitor general Rich Coleman refused comment Wednesday and Thursday.

You just know that these two are putting in a real effort - it shows.

Anonymous said...

AGT has posted his 3rd part of the Basi memos (giving Wikileaks a run) and a scathing cut at the corporate media too.