Good morning,
The SNC story is dominating the news. Here’s an in-depth look at the latest developments:
A day after Prime Minister Justin Trudeau said that “her presence in cabinet should actually speak for itself,” Jody Wilson-Raybould resigned from the Liberal cabinet. Her exit from the Veterans Affairs post comes less than a week after The Globe reported Trudeau’s office attempted to put pressure on Wilson-Raybould while she was attorney-general to shelve the prosecution of SNC-Lavalin.
Trudeau said he was surprised and disappointed by her decision to resign. He said, “if anyone, particularly the attorney-general, felt that we were not doing our job responsibly and according to all the rules as a government, it was her responsibility to come forward to me this past fall and highlight that directly to me. She did not.” (for subscribers)
The background: At the heart of the matter is charges SNC is facing over bribing Libyan officials between 2001 and 2011 to secure construction contracts (go here to read a timeline of the events in the case). SNC is seeking a judicial review of the director of public prosecutions’ decision to pursue criminal prosecution; the Quebec firm wants a settlement.
The prosecutions office: This office is an independent agency that essentially acts as the attorney-general’s deputy. The justice minister has the right to issue directives to it or even take charge of prosecutions. Director Kathleen Roussel says she is “confident that our prosecutors … exercise their discretion independently and free from any political or partisan consideration.” For his part, Trudeau said: “With regard to SNC-Lavalin, let me be direct; the government of Canada did its job and to the clear public standards expected of it.”
What Wilson-Raybould is doing: She has hired former Supreme Court justice Thomas Cromwell as her legal counsel to advise her on what she can say, a step legal observers say is unprecedented for a former attorney-general. Cromwell, who served on the top court from 2008 to 2016, was described by a former colleague as a “lawyer’s lawyer, and a judge’s judge.” (for subscribers)
The issue of solicitor-client privilege: Waiving solicitor-client privilege is a delicate issue, though former Supreme Court justice John Major said Trudeau may have weakened his case by saying he told Wilson-Raybould she was free as attorney-general to make her own decisions.
More on SNC: The Montreal-based engineering firm has nearly 9,000 employees in Canada and many more around the world. It has been a key contributor to the Quebec economy and has been involved in projects in more than 160 countries. But it has also faced troubles beyond the Libya case, including: allegations of bribery in Bangladesh; a former CEO’s guilty plea this year to breach of trust over a Montreal hospital project; and now the possibility of new criminal charges tied to a construction contract for Montreal’s Jacques Cartier Bridge in the early 2000s. (for subscribers)
As this story continues to develop, subscribers can go here for a full primer and the latest details.
SNC opinion and analysis (for subscribers)
John Ibbitson: “Jody Wilson-Raybould’s resignation is a calamity for the Liberals. For one thing, she has made Trudeau look like a fool.”
Konrad Yakabuski: “It would be wrong to let the politics swirling around the SNC-Lavalin saga obscure the validity of the company’s case for a remediation agreement.”
Globe editorial: “The jury is still out. No, scratch that: The jury is in. The court of public opinion is still in session, awaiting evidence. Only the Trudeau government can provide it.” (this piece is available to all readers)
Barrie McKenna: “The political storm in Ottawa over the handling of a corruption case against SNC-Lavalin marks a low point in the government’s troubled effort to shore up its anti-corruption regime.”
This is the daily Morning Update newsletter. If you’re reading this on the web, or it was forwarded to you from someone else, you can sign up for Morning Update and more than 20 more Globe newsletters on our newsletter signup page.
ALSO ON OUR RADAR
The Public Prosecution Service of Canada said it never sought or received instructions from the government in the case of Vice-Admiral Mark Norman. A lawyer for Norman, who is facing charges for allegedly leaking government secrets, had suggested that discussions between Crown lawyers and the Privy Council office were “more concerning” than the news that’s emerged out of the SNC case.
Winter storms forced school closings everywhere from Toronto to Vancouver Island yesterday. And school boards in Ottawa and Montreal have already announced closings for today amid an expected snow dump of as much as 40 centimetres. Extreme weather warnings were also issued for several regions in Alberta, where temperatures approached -45 C with wind-chill.
Alberta’s Auditor-General is probing ties between the province’s energy regulator and an international non-profit set up by its former president and CEO. The case raises questions about oversight at the regulator at a time it has accelerated approvals of major oil-sands projects while the province struggles to clean up orphaned oil and gas wells. (for subscribers)
U.S. President Donald Trump says he’s not happy about the bipartisan agreement that falls short of the funding he wanted for a border wall. But it’s not clear whether Trump will veto it, in turn triggering a second government shutdown come Friday at midnight.
Drug lord Joaquin (El Chapo) Guzman was found guilty on numerous charges that could leave the 61-year-old in a maximum-security U.S. prison for the rest of his life. Evidence showed Guzman and his Sinaloa cartel made billions by smuggling drugs from Mexico into the U.S. via legitimate points of entry, concealed in tanker trucks, passenger cars and rail cars. (for subscribers)
More of Quadriga’s bitcoin funds have gone missing. The Canadian cryptocurrency exchange owes its users about $250-million, but as much as $180-million is locked after its founder – the only person with the passwords – died suddenly in December. Then, a day after Ernst & Young was appointed as monitor last week, the company “inadvertently” transferred half a million dollars worth of bitcoin to cold wallets it is unable to access. (for subscribers)
Got a news tip that you’d like us to look into? E-mail us at tips@globeandmail.com Need to share documents securely? Reach out via SecureDrop
MORNING MARKETS
Stocks rise
Investors hungry for progress on a U.S.-China trade war seized on U.S. President Donald Trump’s comment that he could let a March 1 deadline for a trade agreement with China “slide”, taking this as a cue to buy stocks and sell bonds on Wednesday. Tokyo’s Nikkei 225 was up 1.3 per cent while Hong Kong’s Hang Seng was up 1.1 per cent and the Shanghai Composite Index 1.8 per cent. In Europe, London’s FTSE 100 was up 0.6 per cent at about 7 a.m. ET. The Paris CAC 40 was up 0.3 per cent and Germany’s DAX 0.2 per cent. New York futures are up. The Canadian dollar is at about 75.54 US cents.
WHAT EVERYONE’S TALKING ABOUT
Venezuela is too broken to fix itself – that’s why the Lima Group is key
“Backing Venezuela’s return to democracy is not a matter of wishing to have a friendly and like-minded neighbour; rather, it is an ethical responsibility toward millions of human beings that are living in overwhelming poverty and fear. This is not an opinion, but a fact. There have been many condemnations and fruitless attempts at mediation in the past. Now, the hemisphere is coming together, and Nicolas Maduro and his cronies are being gradually isolated by the world’s democracies. This momentum must be maintained.” – Federico Hoyos, ambassador of Colombia to Canada
Never mind Jeff Bezos’s privacy. Worry about your own
“Last week, the richest man in the world used a free blogging site to accuse a notorious tabloid – which has close ties to the U.S. President – of blackmailing him with explicit photos. The Jeff Bezos story is excellent gossip – and another distraction from how he and other tech titans chip away at everyone else’s privacy every day.” – Denise Balkissoon (for subscribers)
In Memoriam: With the latest category shift, the Oscars are truly dead
“On Monday, the Academy’s board of governors took out a shovel, dug a hole, and jumped so deep inside this new, previously unimaginable low that their voices could be barely heard above all the dirt steadily showering itself into their gaping maws. Was that overkill? I would apologize but the hyperbole fits the disastrous decision by those in charge of this year’s Oscars to completely kill whatever it is that makes the soon-to-be 91-year-old awards ceremony interesting and, most importantly, worthwhile to those in the arts it was designed to honour.” – Barry Hertz (for subscribers)
LIVING BETTER
Arts events to check out in Toronto and Vancouver
Dust might not sound like the most compelling subject. But renowned British artist and curator David Campany has brought a fantastic exhibition to North Vancouver’s Polygon Gallery, Marsha Lederman writes (for subscribers). Among the photos is an iconic image shot in New York on Sept. 11, 2001, which shows a businessman and his briefcase covered in dust and debris. A Handful of Dust: From Cosmic to the Domestic runs until April 28.
And in Toronto, J. Kelly Nestruck says you should go catch Ravi Jain’s unconventional Prince Hamlet (for subscribers). The diverse cast includes women in the roles of Hamlet and Horatio, who is played as deaf by a deaf actor. Dawn Jani Birley doesn’t just provide ASL interpretation; she acts out a parallel, one-person Hamlet with her whole body, Nestruck writes. The production runs until Feb. 24 at Berkeley Street Theatre.
MOMENT IN TIME
The Lumière brothers’ movie camera is patented
(National Media Museum, Bradford/Bridgeman Images)National Media Museum, Bradford [UK] / Bridgeman Images
Feb. 13, 1895: The Lumière brothers’ cinématographe may have been a remake of an earlier work by Thomas Edison, but it had a much bigger impact at the box office. On this day in 1895, Auguste and Louis patented their groundbreaking invention in France. Combining a camera, printer and projector in a relatively lightweight device, it raised the curtain on the idea of viewing a film as an audience, not just a single person looking into a peephole à la Edison’s kinetoscope. A key difference was the claw mechanism that moved the film along in a rhythm inspired by the sewing machine. In March of 1895, the Lumières, whose father owned Europe’s largest photography-plates company, held a screening of their first film: Workers Leaving the Lumière Factory – a 46-second motion picture with a title that gives away the plot. That December, the Lumières held the first public movie showing with an admission fee: a projection of 10 shorts at the Salon Indien du Grand Café in Paris. Moviegoers paid one franc. But the brothers, who collected numerous patents for advances in photography, may not have appreciated the potential of this development. Louis Lumière is said to have declared: “The cinema is an invention without any future.” – Joy Yokoyama
If you’d like to receive this newsletter by e-mail every weekday morning, go here to sign up. If you have any feedback, send us a note.
Arik Ligeti