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Barren piece of land was ripe with plots

Money from sale of half-interest in Newfoundland property owned by former premier was used to unseat Joe Clark as Tory leader

From Wednesday's Globe and Mail

There's not much to look at on Frank Moores's old plots of land in rural Newfoundland, save for a gravel pit, lots of trees and some knee-high shrubs.

But the patches of rock and forest near the town of Shearstown, which were co-owned by Mr. Moores until his death in 2005, may have played a significant role in Canada's modern political history. That land, which might look near worthless to speculators nowadays, acted as a gateway for foreign interests who sought to change the leadership of one of the country's oldest political parties.

In his testimony before the House of Commons ethics committee yesterday, Karlheinz Schreiber said publicly for the first time that a right-wing German party and its former leader, Franz Josef Strauss, helped fund the movement to unseat Joe Clark, who first led the Progressive Conservative Party between 1976 and 1983.

But Mr. Schreiber never told the committee how Mr. Strauss and his party funnelled some of their money into Canada - and it was through Mr. Moores's rural land.

In the early 1980s, after Mr. Moores had stepped down as premier of Newfoundland, he began buying chunks of land about an hour's drive from St. John's. At the time, Newfoundland had high hopes for off-shore oil development and many hoped to cash in by buying land that would be used for the eventual homes and businesses that would follow the oil boom.

At the same time, Mr. Schreiber was in Montreal getting to know Mr. Moores, as well as a group of other Conservatives who were all frustrated with Mr. Clark and would go on to plot his demise as leader.

In Mr. Schreiber's testimony before the committee as well as in media interviews, he has described regular meetings at Montreal's Ritz-Carlton hotel, which were attended by Mr. Moores and Michel Cogger, a fundraiser for Brian Mulroney's eventual leadership campaign. At yesterday's hearing, Mr. Schreiber also mentioned that Mr. Mulroney attended one of the Ritz-Carlton meetings.

And on March 17, 1982, Mr. Schreiber and Mr. Strauss, a right-wing Bavarian premier at the time and a founder of Airbus Industrie, got in on Mr. Moores's land venture.

A Montreal company set up by Mr. Cogger - NBM Land Holdings - bought a half-interest in a parcel of Mr. Moores's land for $369,000.

One of the two companies that owned NBM Land Holdings was controlled by Mr. Schreiber, Mr. Strauss and the German politician's three children.

In interviews with The Globe and Mail and CBC's the fifth estate, Mr. Schreiber has said that the investment was designed to get money to Mr. Moores to depose Mr. Clark.

"[Frank Moores] was not the guy who had the millions laying around. So if he wanted to get this ... done ... he needed to make sure that the whole thing happens, right?" Mr. Schreiber said in a June interview with both media outlets.

"So money was needed so we gave him that money that way, so that he could use [it]. But it was his money... he gave away a piece of his assets to get cash. This is what we did."

Mr. Schreiber has said he has no idea what the acronym NBM stood for and said that it was Mr. Cogger's idea.

Mr. Cogger, who was later appointed to the Senate by Mr. Mulroney, said last night, "I have nothing to say to you. Goodbye," before hanging up the phone.

Max Strauss, one of the sons of the late Franz Josef Strauss, has not responded to repeated requests for comment.

Mr. Schreiber has also acknowledged that he helped pay to fly Quebec delegates to the 1983 Progressive Conservative leadership convention where Mr. Clark stepped down as leader after receiving only 66.9-per-cent support from the party. Mr. Mulroney went on to win the party's subsequent leadership race.

Mr. Moores has been very public about his role in bringing down Mr. Clark, once telling a Montreal Gazette reporter: "When I woke up in Winnipeg the morning after the vote, I had a real downer. ... You don't destroy a guy's political career lightly. But it had to be done for the country's sake."

Mr. Mulroney has tried to distance himself from the Strauss family. During an examination-for-discovery proceeding in 1996, when Mr. Mulroney sued the federal government for accusing him of a crime in connection with the sale of Airbus aircraft to Air Canada, he was asked by a government lawyer: "And [Mr. Schreiber] was known to you as a friend of Franz Josef Strauss?"

Mr. Mulroney replied: "He was not known to me as that, but I subsequently read that he was known to Mr. Strauss. I did not know Mr. Strauss myself, nor did I know any of his family."

That statement has since been refuted by both Mr. Schreiber and Pat MacAdam, one of Mr. Mulroney's staffers when Mr. Mulroney was leader of the opposition in 1983-1984.

In an interview with the fifth estate, Mr. MacAdam described a visit to Mr. Mulroney's office by Mr. Schreiber and Max Strauss: "I just vaguely remember that somebody called [and] said ... Max Strauss and Karlheinz Schreiber were in town and would Brian receive them for a courtesy call," Mr. MacAdam recalled in the 1999 interview. "I asked him, he said sure. So they came into the office and I left them alone."

At Mr. Schreiber's first appearance before the ethics committee on Parliament Hill's Centre Block he was asked about an alleged meeting between Mr. Mulroney, himself and Mr. Strauss.

"Where did this meeting take place?" Liberal MP Robert Thibault asked.

"Here in this building," Mr. Schreiber responded.

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