The stunning confessions keep piling up at the Charbonneau Commission into Quebec’s construction industry, culminating – to this point – with $2-million in cash donations that were spread around by engineering firm Dessau Inc. between 2005 and 2010.
Vice-president Rosaire Sauriol was the fifth senior leader of a major engineering firm to testify about illegal political donations in exchange for lucrative public-works contracts. However, the son of the firm’s founder laid out the highest amount of corrupt donations so far in the life of the commission, which was granted an 18-month extension by the Marois government on Tuesday.
When the previous Liberal government reluctantly launched the public inquiry in a storm of allegations of corruption in 2011, it called for a final report by October of this year. However, Commissioner France Charbonneau recently requested more time as the shocking revelations kept on coming. The Parti Québécois granted an extension that allows for the production of a final report in the spring of 2015.
Mr. Sauriol testified on Tuesday that he ran a fake-invoicing scheme at Dessau to obtain cash for the secret donations, but he added that his brother, president Jean-Pierre Sauriol, was aware of the operations. Acknowledging that the procedure was illegal, Rosaire Sauriol said Dessau obtained the money by paying invoices to the operators of two shell companies, who came back a few days later with the amount – minus a 10-per-cent commission – in cash.
The payments were booked to Dessau’s “sales and marketing” division, Mr. Sauriol said, “to avoid contaminating our [engineering] projects.”
Mr. Sauriol’s testimony will resume on Wednesday morning, at which point he will be expected to provide details on the recipients of the money. So far, previous witnesses at the inquiry have spoken of large cash payments to fundraisers on both the provincial and the municipal stage, although the total figures from the various firms were usually in the six-figure range to this point.
Mr. Sauriol is also expected to be further quizzed on Dessau’s role in controversial contracts in Quebec and the firm’s 2009 hiring of Frank Zampino, a powerful former city councillor in Montreal who has been linked to a number of irregularities by the commission and law-enforcement authorities. Previous witnesses have said that Mr. Zampino oversaw the creation of cartels in which firms received a guaranteed access to municipal contracts in exchange for secret political donations. Mr. Zampino, who has yet to testify before the inquiry, is currently facing fraud charges in relation to municipal contracts.
Mr. Sauriol testified that corrupt political fundraising grew like a disease inside the Quebec construction industry in the 2000s, and that the practice only stopped after a series of media reports and police operations in 2009 and 2010.
“Demands [for political donations] became more and more important over the years,” Mr. Sauriol said. “The cancer was everywhere, and we had to put an end to it.”
The company hired outside consultants and lawyers to draft an ethics code and disclose its tax-avoidance scheme to fiscal authorities, Mr. Sauriol said. He said the company paid $2-million to federal and provincial tax agencies to settle the matter in 2011.
Dessau was co-founded in 1957 by the Sauriol brothers’ father, Paul-Aimé Sauriol.