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A new book suggests that German-Canadian businessman Karlheinz Schreiber paid Brian Mulroney $100,000 not long after he stepped down as prime minister.

In the book, A Secret Trial. Brian Mulroney, Stevie Cameron, and the Public Trust, author William Kaplan says the cash payment came after Mr. Schreiber was summoned to Harrington Lake, the prime minister's summer residence, in late June, 1993. Mr. Mulroney had just left office at the time and his successor, Kim Campbell, let him use the house while his home in Montreal was being renovated.

According to the book, the two met again not long afterward in a Montreal hotel, where Mr. Schreiber handed Mr. Mulroney an envelope stuffed with $100,000. "Thank you," Mr. Mulroney said, according to Mr. Schreiber's account of the meeting. "Thank you very much."

Over the next year or so, Mr. Mulroney received a total of $300,000, always in cash and always in hotels, from Mr. Schreiber, the book says.

In an interview, Luc Lavoie, a spokesman for Mr. Mulroney, said the former prime minister did nothing wrong. "There was nothing illegal about [the payments]," Mr. Lavoie said. "Taxes were paid, it was a commercial transaction and he had left office. It was all proper."

The book portrays the relationship between Mr. Mulroney and Mr. Schreiber as closer than previously known.

Along with the payments, Mr. Mulroney and his wife sent Mr. Schreiber a letter on his 60th birthday in March, 1994, wishing him "congratulations and warmest regards." The letter added: "Your impressive contributions to both Germany and Canada stand today as a very significant personal achievement. We look forward to seeing you and [Mr. Schreiber's wife] soon."

Mr. Kaplan says federal officials have confirmed to him that the close relationship and the $300,000 payment would have been important information in 1997, when the government was negotiating a settlement with Mr. Mulroney. At that time, Mr. Mulroney sued the government over a letter the RCMP had sent to Swiss officials in 1995 seeking information as part of an investigation into allegations of fraud involving Mr. Schreiber and the former prime minister. None of the allegations were proven and the government apologized and paid Mr. Mulroney $2-million.

The book points out that Mr. Mulroney testified in April of 1996 that he knew Mr. Schreiber only "in a peripheral way."

"I don't think ordinary Canadians would consider a peripheral relationship where cash is handed over to a former prime minister in meetings in hotels," Mr. Kaplan said in an interview.

He added that there is no suggestion Mr. Mulroney or Mr. Schreiber did anything wrong. "At the same time, we now know that Mulroney and Schreiber had a relationship in which cash was transmitted in hotels. That's not the ordinary way former prime ministers do business," he said. "I certainly don't think the government lawyers would have settled the case and paid $2-million had they known about the existence of the money."

Mr. Lavoie said the settlement was based on the allegations in the RCMP letter and had nothing to do with Mr. Mulroney's business dealings after he left office. He also said the RCMP asked Mr. Mulroney's lawyers about the payments in 2001 but did not pursue the matter.

Mr. Lavoie also defended Mr. Mulroney's characterization of his relationship with Mr. Schreiber as "peripheral" and noted that the businessman had retained the services of several other former politicians. "The professional relationship that consultants, including lawyers, have with their clients is and should be peripheral," he said.

As for the birthday greeting, Mr. Lavoie said Mr. Schreiber received a similar greeting from Jean Chrétien who was prime minister at the time.

Mr. Lavoie said all the suggestions in the book are "well known stuff" and added, "I think it's old news."