Brian Mulroney's former chief of staff asked Karlheinz Schreiber to send money to the former prime minister's lawyer in Switzerland “for Airbus,” Mr. Schreiber testified Thursday.
Mr. Schreiber told the House of Commons ethics committee that he was stunned when Fred Doucet requested he transfer cash to a Swiss bank account. Mr. Doucet was working at the time as a lobbyist.
He said the conversation occurred when Mr. Mulroney was still in office and took place in the Ottawa offices of lobbyists Government Consultants International (GCI), a firm run by former Newfoundland premier and Mulroney associate Frank Moores.
“I nearly froze when he said, ‘I want you to make sure that GCI through you transfers certain amounts of money to an account in Geneva,' to a lawyer in Geneva, which is Mr. Mulroney's lawyer,” Mr. Schreiber said.
“Why the hell would one send money to a lawyer in Geneva for Mr. Mulroney? What for? And now came his unbelievable answer: He said, ‘For Airbus.' And I hear myself, even today, saying what the hell has Mulroney to do with Airbus? And his answer was, ‘Are you naive?' ”
This is the most detailed account Mr. Schreiber has delivered about a conversation with Mr. Doucet that was first disclosed in his sworn affidavit filed several weeks ago in Ontario Superior Court. That affidavit was the first time Mr. Mulroney had been connected to the millions of dollars in secret commissions that were paid by Airbus to Mr. Schreiber.
Last month, Mr. Doucet told The Globe and Mail the allegation was “an absolute, total fabrication.”
In a brief phone conversation, Mr. Doucet said he never spoke with the German-Canadian middleman about transferring money to a Geneva lawyer.
"It is not true. I've never known a lawyer in Geneva and I don't, to this day, know one and I have never spoken with Karlheinz Schreiber about transferring any funds, anywhere."
Mr. Mulroney has denied benefiting in any way from the sale and won a settlement from the government in 1997 when his name was mentioned in an RCMP investigation into the sale. On Tuesday, Mr. Schreiber testified that he gave $300,000 to Mr. Mulroney in 1993 and 1994, but that the money was for “future services” and was not related to Air Canada's purchase of Airbus planes in the 1980s.
Mr. Schreiber said he met alone with Mr. Doucet in late 1992 or early 1993 when the Airbus cash request was made. He said he later went with Mr. Doucet's request to Mr. Moores, who told him not to bother with it.
Mr. Schreiber did not say and was not asked about the identity of the Mulroney lawyer to whom he was asked to wire money.
Members of the House of Commons ethics committee questioned Mr. Schreiber about a threatening letter he sent in May to the former prime minister.
The letter, included in more than 4,000 personal documents that Mr. Schreiber turned over to the committee at his last appearance, accused the Harper government and Mr. Mulroney of “conspiracy and cover-up action” regarding his pending extradition to Germany.
“This is my last warning, “ the former arms dealer and lobbyist wrote. “I am prepared to disclose ... that I was asked by Fred Doucet to transfer funds to your lawyer in Geneva, (Airbus) ... that you asked me through my lawyers to commit perjury to protect you. ... and more.” Although most of the allegations have been already reported by journalists, committee members seized on the reference to Airbus and Mr. Doucet.
The letter in question, dated May 8, 2007, refers to previously reported allegations, including:
• How Mr. Doucet allegedly asked Mr. Schreiber to transfer funds to Mr. Mulroney's lawyer in Geneva, which Mr. Doucet has denied.
• A 1998 trip to Zurich in which Mr. Mulroney met Mr. Schreiber, allegedly to discuss $300,000 in cash payments made in 1993 and 1994.
• Alleged attempts by Mr. Mulroney's lawyers to camouflage the payments.
“The time has come that you bring the whole battle with me to a peaceful and satisfying end,” Mr. Schreiber wrote.
Liberal MP Robert Thibault said the letter raises serious questions. “If this is not true,” he said, “then it's blackmail. Then it should have been turned over to the RCMP, I would think, by Mr. Mulroney. If it is true, these are very serious allegations that warrant an investigation.”
Questions have long swirled around the 1988 purchase of 34 Airbus jets worth $1.8-billion by Air Canada, owned by the Crown at the time. Mr. Mulroney sued for defamation after a 1995 letter from the RCMP to Swiss authorities was leaked. It revealed the Mounties were linking the former Progressive Conservative prime minister's name to kickbacks connected to the Airbus deal.
The Liberal government under Jean Chrétien hit a low point in 1997 when it paid Mulroney a $2.1-million settlement to cover his legal and professional fees.
The Liberals apologized for the so-called letter of request, but not for the RCMP probe into Mulroney and Airbus. That continued another six years before ending without charges.
Mr. Schreiber is out on bail until the Supreme Court of Canada decides whether to hear an appeal of his extradition order. He is wanted in Germany to face charges of fraud, bribery and tax evasion.
Mr. Schreiber was met by a scrum of reporters and photographers as he was dropped off at Parliament Hill for Thursday's testimony. It was a far different scene from his earlier appearances, when he was led into the Parliament building in handcuffs by police officers.
A copy of the committee's proposed witness list shows MPs have drawn up a wish list of testimony from 34 people.
In addition to players whose names have repeatedly come up at the committee over the past two sessions – such as Mr. Mulroney, Mr. Doucet and Mr. Mulroney's solicitor-general, Elmer MacKay – the committee hopes to hear from Prime Minister Stephen Harper, his chief of staff, Ian Brodie, and his communications director, Sandra Buckler.
Several journalists and writers are on the list: author Stevie Cameron; the CBC's Harvey Cashore and Linden MacIntyre; as well as William Kaplan, the author of two books on the Mulroney-Schreiber affair.
Thomas Niles, a former U.S. ambassador who questioned the tactics used to sell Airbus planes to Air Canada in 1988, also made the cut.
So did other former Mulroney-era ministers and aides – and Sharon MacKay, the wife of Elmer MacKay, presumably because of a message that was sent from her e-mail account to Mr. Schreiber that contained a draft apology to Mr. Mulroney.
Some of the names on the list, such as those of Mr. Harper's senior aides, are clearly aimed at probing Liberal claims that the current government covered up allegations raised by Mr. Schreiber – they include 11 ministers, political aides and senior civil servants in the current government. However, under Commons rules, current MPs, including the Prime Minister, cannot be forced to testify before a committee – although that does not apply to former MPs such as Mr. Mulroney.
Meanwhile, a new poll suggests more than half of Canadians are paying little or no attention to the saturation coverage of the Mulroney-Schreiber affair.
Three-quarters of those surveyed in the Canadian Press Harris-Decima poll said it's had no effect on how they feel about Prime Minister Stephen Harper's Conservative government.
The results of the poll indicate that the opposition has been getting scant political mileage out of the allegations of corruption being levelled at ex-prime minister Brian Mulroney by his former friend, Karlheinz Schreiber.
The telephone poll of just more than 1,000 Canadians was conducted Nov. 29-Dec.2, just after the first day of Schreiber's testimony before the Commons ethics committee. He has since made two more appearances before the committee.
With reports from Daniel Leblanc, Campbell Clark and The Canadian Press
