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Mulroney-Schreiber report won't show us the money, critics say Add to ...

As head of investor relations for a publicly traded airline, Denis Biro was used to calls from obsessed airplane enthusiasts who wanted to know every last detail about Air Canada's fleet.

So when someone named Fred Doucet called his office in 1993 and asked for a delivery schedule of the 34 Airbus jetliners recently purchased by the airline, Mr. Biro didn't give it a second thought.

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Mr. Doucet, however, was no aerospace junkie. Rather, he was the long-time friend and aide to former prime minister Brian Mulroney. And the day Mr. Doucet received that Airbus delivery schedule - Aug. 27, 1993 - was the same day Mr. Doucet arranged for Mr. Mulroney to meet with Airbus lobbyist Karlheinz Schreiber at a Quebec airport hotel, where the retired Tory politician accepted an envelope containing at least $75,000 in cash.





<a title="View Read the memo from Denis Biro to Jean Alfred &quot;Fred&quot; Doucet, and Mr. Doucet's memo to Karlheinz Schreiber on Scribd" href="http://www.scribd.com/doc/32231929/Read-the-memo-from-Denis-Biro-to-Jean-Alfred-Fred-Doucet-and-Mr-Doucet-s-memo-to-Karlheinz-Schreiber" style="margin: 12px auto 6px auto; font-family: Helvetica,Arial,Sans-serif; font-style: normal; font-variant: normal; font-weight: normal; font-size: 14px; line-height: normal; font-size-adjust: none; font-stretch: normal; -x-system-font: none; display: block; text-decoration: underline;">Read the memo from Denis Biro to Jean Alfred "Fred" Doucet, and Mr. Doucet's memo to Karlheinz Schreiber</a> <object id="doc_797776113145" name="doc_797776113145" height="600" width="100%" type="application/x-shockwave-flash" data="http://d1.scribdassets.com/ScribdViewer.swf" style="outline:none;" > <param name="movie" value="http://d1.scribdassets.com/ScribdViewer.swf"> <param name="wmode" value="opaque"> <param name="bgcolor" value="#ffffff"> <param name="allowFullScreen" value="true"> <param name="allowScriptAccess" value="always"> <param name="FlashVars" value="document_id=32231929&access_key=key-2lfomngv6x98eo71mezg&page=1&viewMode=list"> <embed id="doc_797776113145" name="doc_797776113145" src="http://d1.scribdassets.com/ScribdViewer.swf?document_id=32231929&access_key=key-2lfomngv6x98eo71mezg&page=1&viewMode=list" type="application/x-shockwave-flash" allowscriptaccess="always" allowfullscreen="true" height="600" width="100%" wmode="opaque" bgcolor="#ffffff"></embed> </object>




That highly scrutinized transaction, and the two other cash payments that followed it over the next year, are the primary focus of a four-volume report set to be released Monday by Mr. Justice Jeffrey Oliphant, a little less than a year after he wrapped up hearings into what is commonly referred to as the Mulroney-Schreiber affair.

But what won't be in the report, thanks to the inquiry's confining terms of reference, is an explanation of what, if any, role Airbus Industrie, the European manufacturer that funnelled more than $20-million to Mr. Schreiber after Air Canada's purchase of $1.8-billion worth of planes, played in those payments. While Judge Oliphant's report is expected to criticize Mr. Mulroney for accepting cash payments in hotel rooms, it will not detail the lucrative airplane purchase that enriched Mr. Schreiber, and possibly others, because the commission and its staff of eight lawyers were barred from asking about it. It's an absence that many are calling into question.

"It's unfortunate that the inquiry didn't go ... beyond. It had a very narrow mandate, and didn't go over Mr. Doucet's claim that he had no involvement in Airbus and no interest in Airbus, when the evidence clearly showed that he did," said Mr. Biro, who recently retired from Air Canada.

"There's no answer to the question - what happened to the money?"





It's a question that's familiar to the many observers who have closely followed the saga since 1995, when it was revealed that a secret side deal saw millions of dollars flow to a Liechtenstein shell company controlled by Mr. Schreiber as each Airbus plane was delivered to Air Canada, which was a Crown Corporation when the contract was signed. But years later, when University of Waterloo president David Johnston was charged with setting the guidelines for what would become the Oliphant inquiry, he called the Airbus affair "well-tilled ground," citing an RCMP investigation that resulted in no criminal charges.

Left only to probe the payments themselves, the Oliphant inquiry burrowed into the fine details of each handover of cash - right down to the size of the envelope, and what pocket Mr. Mulroney placed the money. Commission lawyers also probed a series of payments that Mr. Schreiber made to Tory lobbyists after the Mulroney government signed an understanding in principle to consider supporting an armoured vehicle factory in Cape Breton for one of Mr. Schreiber's clients, Germany's Thyssen AG.

As for how critical Judge Oliphant will be of Mr. Mulroney's conduct, if at all, the inquiry has been tight-lipped. The terms of reference require him to answer 17 questions about the circumstances and propriety of the cash payments, but the most exacting and difficult one is undoubtedly the first on the list: What were the business and financial dealings between Mr. Schreiber and Mr. Mulroney?





I don't envy the commissioner. How is he going to answer questions like what was the money for? William Kaplan, author and lawyer who first revealed the cash payments in 2003.




Mr. Mulroney's explanation that he was hired to promote armoured vehicles to leaders of the French and Russian governments - both dead - as well as China and the United Nations has been called implausible by experts in the arms trade and Canada's former ambassador to China. Mr. Schreiber's version of events, that he paid Mr. Mulroney, a Tory, to promote an armoured-vehicle factory to the then Liberal governments of both Canada and Quebec, was picked apart and pilloried by the lead commission counsel, Winnipeg defence lawyer Richard Wolson.

Because Judge Oliphant was prevented from exploring other possibilities for the payments, it's difficult to imagine how he can go further than describing both explanations as not credible, said author and lawyer William Kaplan.

"I don't envy the commissioner. How is he going to answer questions like what was the money for? I do not know how he's going to do that based on the evidence he heard," said Mr. Kaplan, the author who first revealed the cash payments in The Globe and Mail in 2003.

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